Mar 26, 2021 Newsdesk Latest News, Macau, Top of the deck
Casino games maker and casino management firm Paradise Entertainment Ltd slipped to a HKD189.2 million (US$24.3 million) net loss for full-year 2020, compared to a HKD926,000 profit in 2019, it said in a Thursday filing to the Hong Kong Stock Exchange.
The results were “significantly affected” by the outbreak of Covid-19 and subsequent travel protocols, said the group in commentary on the results.
Paradise Entertainment managing director and chairman Jay Chun was quoted in the release as saying that Macau’s gaming market was “significantly disrupted” as the pandemic brought the global travel and tourism industry “almost to a standstill”.
The group’s 2020 loss was on revenue that fell 70.2 percent, to HKD351.7 million, from just over HKD1.18 billion a year earlier.
Macau’s overall casino gross gaming revenue (GGR) shrank 79.3 percent year-on-year in calendar year 2020.
Paradise Entertainment’s adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were negative, to the tune of HKD101.1 million for the 12 months to December 31, versus a positive performance of HKD87.0 million in 2019.
The group said a factor in weaker 2020 performance was absence of revenue from casino management services after it ceased on February 29 last year, to manage casino operations at Casino Waldo, a so-called satellite venue in Macau under the licence of Macau concessionaire Galaxy Entertainment Group Ltd.
Paradise Entertainment still runs casino operations at Casino Kam Pek Paradise (pictured), under the licence of Macau concessionaire SJM Holdings Ltd.
At Casino Kam Pek Paradise, GGR declined 56.2 percent year-on-year to HKD556.6 million. The property contributed a loss of HKD42.7 million to the group’s adjusted EBITDA in 2020.
In addition, the games maker saw its 2020 income from the sale of electronic gaming equipment and systems fall 85.8 percent, to just under HKD25.3 million, from HKD177.6 million a year earlier.
Paradise Entertainment sold 23 slot machines overseas, and 20 terminals of its electronic table game product series Live Multi Game (LMG) in Macau, while providing upgrade services for 438 LMG terminals in Macau.
The electronic gaming equipment and systems segment posted a negative EBITDA of HKD71.6 million last year, mostly due to research and development costs of HKD64 million, versus positive EBITDA of HKD5.4 million a year earlier.
Mr Chun said in his remarks in the results filing, that Paradise Entertainment had been investing in what he termed “high-tech” products that would generate “fresh revenue streams for the group in the years ahead”. “High-tech and [the] gaming industry will merge more closely in future,” he added.
Paradise Entertainment-controlled LT Game Ltd, a provider of electronic gaming equipment and management technology for casinos, said in January it was aiming to launch a new “Jackpot Series” games for slot machines in Macau in the first quarter this year.
Paradise Entertainment’s 2020 results reported some success in diversifying its business as a response to the Covid-19 crisis, via “procurement services” within mainland China, “for overseas customers”. It managed to realise positive EBITDA of HKD53.9 million via that route.
Mr Chun said the group would strive to identify other new business opportunities in Macau and overseas markets.
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