Korea’s Paradise Co saw its losses widen significantly to KRW35.76 billion (US$31.7 million) in the three months to 31 December 2018, increased from a loss of KRW12.77 billion in the same period in 2017.
The loss was attributable primarily to an increase in operating costs at its Incheon integrated resort Paradise City – a joint venture with Japan’s Sega Sammy Holdings. The 4Q18 results also pushed Paradise Co’s full year results into the red at KRW34.07 billion.
While Paradise City achieved record casino drop during the fourth quarter, helping sales grow 23.3% year-on-year to KRW87.66 billion, the company pointed to the 21 September 2018 launch of new non-gaming facilities – including a boutique hotel, nightclub, art gallery, shopping mall, film studio and indoor family entertainment facility – as having pushed up operating costs by 44.2%.
As a result, 4Q18 losses at Paradise City climbed to KRW42.46 billion compared with KRW3.11 billion 12 months earlier.
It was a different story at the company’s Paradise Walkerhill and Jeju Grand properties, which combined for a 9.7% increase in sales in 4Q18 to KRW107.35 billion, moving from a loss of KRW11.24 billion in the prior year period to a profit of KRW7.81 billion.
Group-wide, Paradise Co saw sales increase 14.3% in the fourth quarter to KRW216.82 billion but with losses widening, EBITDA fell 65% to KRW4.52 billion.