GGRAsia – Sharp earnings uptick likely at Paradise Co: brokerage

Sharp earnings uptick likely at Paradise Co: brokerage

Jul 11, 2016 Newsdesk Latest News, Rest of Asia, Top of the deck

South Korean casino operator Paradise Co Ltd is likely to see a “sharp earnings improvement” in the third quarter of 2016 based on a low comparison base from the prior-year period, said Seoul-based brokerage Shinhan Investment Corp.

“Casino revenues are expected to grow at a monthly average of 30 percent to 50 percent year-on-year in the third quarter of 2016,” said analyst June-won Sung.

Shinhan Investment, a subsidiary of Shinhan Financial Group Co Ltd, provides security brokerage and investment banking services in South Korea.

The brokerage said in a note last week it expects Paradise Co to report consolidated sales of about KRW189.9 billion (US$165.5 million) for the third quarter of 2016, up by 33 percent year-on-year. Operating profit is expected to increase by 139.9 percent year-on-year to KRW27.5 billion, it added.

“Casino revenues should reach KRW164.4 billion (+39.9 percent year-on-year). In the fourth quarter of 2016, consolidated operating profit is estimated [forecast] at KRW27.2 billion (+146.6 percent year-on-year),” said Mr Sung.

Paradise Co’s casino sales for the first half of 2016 reached approximately KRW299.8 billion, a 2.2 percent increase from the prior-year period. In June, the casino operator reported casino sales of KRW46.1 billion, up by 99.2 percent from the prior-year period.

The numbers are for gaming sales at Paradise Co’s casino division, comprising the properties Walkerhill, in Seoul; Jeju Grand on Jeju Island; Incheon, near Incheon International Airport; and Busan Casino.

“Paradise is expected to have seen second quarter 2016 consolidated operating profit of KRW25 billion, up by 88.6 percent year-on-year,” said Shinhan Investment’s Mr Sung.