Grand Korea Leisure reported an 11% drop in net profit for the fourth quarter as fewer Chinese and Japanese high rollers patronized the company’s three foreigners-only casinos.
GKL, which is 51% owned by the Korea Tourism Organization, an agency of the South Korean government, and trades on the Korea Stock Exchange (114090) saw 4% fewer VIP players over the 12 weeks ended 31st December than in the same period in 2012. The Chinese contingent was down 2%, the Japanese down 4%.
The result was a 13% decline in table drop to 932 billion won (US$893 million). But the company played lucky at a higher than average hold ratio of 15.2%, and total revenue increased year on year by 4% to KRW142 billion. Operating profit was up 30% to KRW39 billion. However, higher expenses, including retroactive overtime costs and accounting changes that resulted in a higher tax rate (34% versus the normal 24%), combined to offset the gain, and the bottom line was down 11% to KRW26 billion.
GKL operates two casinos in the capital of Seoul and one in Busan.
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