Revenue and profits surge at Grand Korea

A filing to the South Korean stock exchange from casino operator Grand Korea Leisure (GKL) saw the company report a 38 per cent like-for-like increase in net income to KRW25.6bn (E20.7m).

The company’s gain in operating income for the quarter was even more impressive – jumping 44.8 per cent to KRW31.4bn (E25.5m).

The result was largely the result of an unusually soft comparative performance: during the second quarter of 2015, a local outbreak of Middle East Respiratory Syndrome (MERS) led to a dramatic fall in tourist visitation to the country.

A subsidiary of the government’s Korea Tourism Organisation, GKL operates three casinos in South Korea – all under its Seven Luck Brand. All three properties are forbidden from allowing South Korean citizens entry to the casino floor – and are thus entirely reliant on foreign (particularly Chinese) visitation.

Its latest raft of financials constitute a marked improvement not just on the PCP, but on a consecutive quarterly basis. The first three months of 2016 were disappointing for GKL, with revenue and earnings both down by 8 and 16 per cent respectively.

Speaking to GGR Asia, Daiwa Securities analyst Daiwa Securities quoted GKL management, saying that company anticipated a growth in mass market revenue in the second half of the year.

He continued: “Management noted the casino operator plans to have tighter control on its marketing and other operating costs to improve its earnings visibility for the second half of 2016 and onwards.”