Hong Kong-listed International Entertainment Corporation (IEC) has revealed it took out a HK$608.9 million (US$78 million) loan as part of its moves to assume control and expand the gaming operations of the casino located within its Manila hotel, New Coast Hotel Manila.
The update formed part of a profit warning issued by the company overnight in which it said it expects to report a loss of HK$36.1 million (US$4.6 million) for the six months to 31 December 2023, widened from a HK$6.4 million (US$818,000) loss a year earlier. The widened loss is in part due to a HK$10.5 million (US$1.3 million) increase in interest costs as a result of the loan.
IEC confirmed it had obtained the loan “to finance the funding need for developing, operating and managing the casino by the Group under the Provisional License granted [by gaming regulator PAGCOR] on 27 September 2023.
As reported by Inside Asian Gaming, IEC agreed to invest between US$1 billion and US$1.2 billion to develop a new integrated resort with casino gaming at the site of New Coast Hotel Manila after inking its Provisional License Agreement PAGCOR.
The agreement will see IEC take over casino operations at New Coast from PAGCOR while also enhancing the hotel’s amenities to provide 800 5-star luxury hotel rooms, restaurants, leisure facilities and shopping arcades.
In issuing its profit warning overnight, IEC said it enjoyed a HK$11.7 million (US$1.5 million) year-on-year increase in revenue from the group’s gaming operation due to the recovery of the gaming industry in the Philippines, plus a fair value gain of investment properties of HK$7.1 million (US$907,500) versus a HK$16 million (US$2.0 million) fair value loss a year earlier.
However, alongside the increased interest expense, the company also saw an increase in general and administrative expenses of HK$38.5 million (US$4.9 million) as costs related to preparing to operate and manage the casino.
Final results are due to be published on 28 February.
