Two of Asia’s burgeoning integrated resort operators have issued profit warnings ahead of the release of their 1H19 financial results, with both expecting to record a loss for the period.
Landing International Development Ltd, which operates Korea’s Jeju Shinhwa World, issued a statement on Friday warning it expected to record a net loss for the six months ended 30 June 2019 as compared to a profit of HK$280 million 12 months earlier. It explained that the loss is mainly attributable to a “decrease in net revenue from gaming business, decrease in revenue from sales of residential properties; decrease in interest income and increase in finance cost, and increase in amortization and depreciation charges due to progressive opening of various facilities in Jeju Shinhwa World.
Imperial Pacific International (IPI), which is developing an integrated resort in Saipan, said it also expects to record a loss in 1H19 due to a decrease in total revenue and the impairment of trade receivables.
The company suffered HK$2.97 billion (US$378.4 million) loss in 2018 led by a decline in VIP revenue from HK$7.35 billion to HK$2.91 billion. IPI said at the time that it had written off trade receivables of HK$4.69 billion in 2018, leaving outstanding receivables at HK$9.67 billion. Of those more than 50% had been outstanding for over a year.