Macau’s Paradise Entertainment Ltd has signed a new 12-month deal with the brother-in-law of Chairman and CEO Jay Chun to sell up to HK$40 million worth of electronic gaming machines and equipment in the US, Canada and Australia.
The Supply Framework Agreement, to run from 1 January 2020 to 31 December 2020, will see Paradise’s products sold to Mr Linyi Feng at an 8% to 10% discount to recommended retail prices for the development, manufacture, sale, marketing and distribution of the products into certain global markets.
In a Thursday filing, Paradise said the HK$40 million cap for 2020 was arrived at based upon the expected number of new EGM products to be launched by the group in 2020, expected demand in target markets plus a buffer for any unexpected increase in demand.
A similar agreement for 2019 produced sales of just HK$997,000, although the company said low usage of the 2019 cap “was mainly due to some technical issues of certain parts of the products supplied by third parties which caused unexpected delay in launching the products in the markets.”
Outlining the benefits of the 2020 agreement, Paradise said it “believes that sale of the products to the buyers will raise the profile of the products, enhance the products’ penetration into overseas markets and generate additional revenue for the group.”
In its most recent results announcement last month, Paradise reported sales from its electronic gaming equipment segment of HK$25.7 million for the three months ended 30 September 2019.