Grand Korea Leisure Reports 50% Income Decline

It was only in June 2018, when Grand Korea Leisure named, Yoo Tae-Yeol, chief executive officer. Soon after that, the detailed J.P Securities report for the first quarter of 2018 showed that the company recorded a 1% drop in overall revenues. The decline was incentive for leadership change.

However, the change took place without the desired outcome. As the results from Korea Exchange shows, the last quarter of 2018 saw a 51.8% decrease in profits. At the same time, we can see only $6.1 million in revenues recorded in the last quarter of 2018. Total revenues come from three gambling facilities which also marked an overall loss. Comparing to previous years, there is 15.7% income drop from 2017 with $51.3 million earnings from slot machines (14.4% drop from the last year).

Decline Reasons

Looking at the reason for the decline, we can observe several things…

First of all, there was an overall decline in Chinese tourism in 2018.

Followed by that, there are considerable tensions in the relation between China and South Korea. The growth of Japanese tourism was not enough to compensate the previous losses.

Grand Korea Leisure Background

Grand Korea Leisure represents the company responsible for casino operations in South Korea. It is one of two enterprises which provides casino services to foreign customers. Paradise Co. Ltd is another provider specializing in gaming products for outside customers. This company recorded a notable sales increase, without effects from neighbour, GKL.

And Paradise Results…

Starting from 2017, Paradise Co. enterprise has marked a 15.7% rise in revenues which resulted in $92.4 million income more than last year. Another success was seen in its slot machines profit increase of 16.9%, which resulted in an overall slot income of $38 million.

Future Insights

If we analyze the previous situation, we can move forward with several observations. The numbers are not popular for Grand Korea Leisure. The chief executive, Yoo Tae-Yeol, will soon become accountable for the results. As a reminder, the previous executive was ousted from the company for only a 1% decrease. It is obvious that Yoo will experience the same destiny very soon. The government officers continue paying attention to Grand Korea Leisureˈs fluctuating revenues. With their active inclusion, we can only wait for upcoming decisions and possible executives change.

Source:

“Grand Korea Leisure sees income drop 50% in the final quarter”, Admir Aljic, calvinayre.com, February 15, 2019.