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Kangwon Land's Q1 net profit rises as casino sales fall

Kangwon Land, the nation's only casino resort operator where domestic gambling is allowed, said its net profit rose 13.3 percent in the first quarter from a year earlier despite a slight drop in gaming revenue.

Those gains in the three months to March 31 were 102.4 billion won (US$86.5 million), compared with 90.4 billion won in the same period last year, according to data submitted to the Korea Exchange on Thursday. The company said its first-quarter net profit rose 437.8 percent, compared with 19 billion won in the fourth quarter of last year.

Kangwon Land said its operating profit fell slightly by 0.7% year-on-year to about 125.1 billion won in the first quarter of this year.

Korea currently has nearly 20 casinos, but Koreans can only gamble at Kangwon Land Casino Resort (pictured) in the uplands of Gangwon Province, 150 kilometers (93 miles) from the capital, Seoul.

The casino operator posted revenue of 377.45 billion won in the first three months of 2019, down 0.3% from a year earlier. That included total revenue of 329 billion won for gaming, down 1.2% from a year earlier.

The company reported a slight year-over-year decline in its large market gaming segment but an increase in sales in its so-called "membership club" segment.

Kangwon Land's mass table division sales fell 0.4% year-on-year to 163.9 billion won in the first quarter and slot machine sales fell 5.6% to 173 billion won, according to a presentation submitted separately on Thursday. Membership club division sales reached 61.2 billion won in the period, up 12.7% from a year ago.

Kangwon Land's non-game revenue rose 6.4% year-on-year to 48.4 billion won in the first quarter.

The company's sales cost during the reporting period was KRW 180.6 billion, up 5.1% year-on-year.

We have not commented on the quarterly results submitted to the Korea Exchange, nor have we made a separate presentation posted on our website.

Kangwon Land, however, noted that the total number of customers at casino resorts during the reporting period rose 2.1% year-on-year to 745,566.

The company is the only authorized supplier of casino games to the Korean people, and it is under considerable supervision from the Korean government.

However, analysts DS Kim and Christopher Tang of JPMorgan Securities (Asia Pacific) said in a note on Thursday following the first-quarter numbers that the announcement of a cap on Kangwon Land's 2019 fiscal gross game earnings (GGR), currently expected in May, would likely be "non-event".

"Gangwon's GGR is very unlikely to reach sales cap levels in any scenario," analysts said.

BY: 릴게임사이트

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