GGRAsia – Kangwon Land posts 22pct profit decline in 3Q

Kangwon Land posts 22pct profit decline in 3Q

Nov 09, 2018 Newsdesk Latest News, Rest of Asia, Top of the deck

Kangwon Land Inc, the operator of the only casino resort in South Korea where the country’s nationals are allowed to gamble, reported net income of nearly KRW93.3 billion (US$83.5 million) for the third quarter of 2018, down 21.6 percent from the prior-year period.

Revenue from sales declined by 3.1 percent year-on-year to approximately KRW369.1 billion in the three months to September 30, the company said in a filing to the Korea Exchange on Thursday.

Operating income for the three-month period went down by 10.0 percent year-on-year to KRW123.9 billion, Kangwon Land reported. The firm’s operating margin fell by 2.5 percentage points, to 33.6 percent.

Kangwon Land reported gaming sales of KRW317.5 billion for the three months ended September 30, a decline of 7.5 percent from a year earlier. The company reported declines in most of its gaming segments, with sales in the mass segment falling 9.1 percent year-on-year, to KRW154.5 billion.

Revenue from slot machines fell by 7.4 percent year-on-year to KRW138.7 billion. Revenue from sales in the firm’s so-called “Membership Club” stood at KRW57.7 billion, up 1.4 percent from the prior-year period.

Non-gaming revenue rose by 36.8 percent year-on-year to KRW51.6 billion in the third quarter, the firm said in a separate presentation published on Thursday.

For the first nine months of 2018, the casino operator reported accumulated net income of KRW278.3 billion, down 22.5 percent from the prior-year period. Sales for the nine months to September 30 were nearly KRW1.09 trillion, a decrease of 6.6 percent from a year earlier.

South Korea’s nationals are only allowed to gamble at Kangwon Land casino resort (pictured) in an upland area of Kangwon province – 150 kilometres (93 miles) from the country’s capital Seoul.

The casino operator has been under political pressure to moderate the growth of its revenue. Kangwon Land has slimmed its daily opening hours since April 1, following an order of the South Korean government. The casino at the property now opens to the public from 10am to 4am of the following day. The casino at Kangwon Land previously operated from 10am to 6am of the following day.

The company was also ordered to reduce the number of mass tables, from a maximum 180 to a maximum 160, starting January 1, 2018.