Hong Kong-listed casino equipment maker Paradise Entertainment Ltd on Friday posted a loss attributable to its owners of HKD416.8 million (US$53.7 million) for the first half of 2016, compared to a net loss of HKD23.9 million a year earlier.
The company said the loss was “mainly due to the one-off loss on disposal of patents and patent applications” worth HKD334.8 million related to the grant of some exclusive rights to global gaming supplier International Game Technology Plc (IGT).
Paradise Entertainment in April agreed to transfer all of its electronic table game (ETG) technology, patents and other intellectual property to IGT, with the exception of table game intellectual property used exclusively in Macau.
IGT paid Paradise Entertainment an up front fee of US$12.95 million. IGT will also make earn-out payments – over a 15-year term – based on placement in casinos of products utilising Paradise Entertainment’s table game intellectual property, according to previous filings.
“The group believes that the grant of the exclusive rights to IGT not only boost the sales and popularity of the LMG in the U.S. but also pave the best path to create value for the group … and increase the revenue base of the group,” said Paradise Entertainment in Friday’s filing. It was referring firstly to its Live Multi Game (LMG) product range, which offers table games featuring a a live dealer but electronic betting and bet settlement.
Paradise Entertainment develops, supplies and sells electronic gaming systems in Macau and internationally under the LT Game brand. The company also provides casino management services in Macau under service agreements with two existing Macau operators.
Paradise Entertainment reported revenue of HKD519.8 million for the six months ended June 30, down by 9 percent from the prior-year period. Such decrease was attributable to the decline in gross gaming revenue of the casino management business, the firm said. The provision of casino services generated about 77.5 percent of the company’s total revenue.
The firm currently manages casino gaming at Casino Macau Jockey Club, Casino Kam Pek Paradise and at an electronic gaming hall at Casino Lisboa, all properties under the SJM Holdings Ltd gaming licence. It also manages casino operations at Casino Waldo, under a Galaxy Entertainment Group Ltd licence.
Revenue generated by the sales and revenue sharing of LMG terminals contributed 22.5 percent of the total revenue, said the firm.
Paradise Entertainment said it “remains cautiously optimistic” about the future, adding that it “will continue to execute the established business strategies while at the same time striving to promote and develop the existing Macau gaming market”.
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”We do not believe that reopening the advance notice nomination deadline [for board directors] is appropriate or justified”
Daniel Boone Wayson
Chairman of the Wynn Resorts board of directors