Foreign Casinos Breathe New Life After COVID-19 Dark Period (Comprehensive)

Paradise and GKL Both Return to Profit in Q1

Impact of Increased Japanese VIP Drop Amount
Expecting Expanded Customer Inflow from China and Others in Second Half
Kangwon Land's Operating Profit Also Up 561.9% YoY

Foreigner-only casinos, which were struggling due to COVID-19, successfully turned a profit in the first quarter of this year, easing the pressure on their performance rebound. This is the result of increased customer inflow following the resumption of visa-free travel to Japan since the second half of last year. If conditions for attracting tourists improve, such as easing quarantine regulations and increasing flight routes, it is expected that expanding marketing regions to China and Hong Kong will accelerate the normalization of operations this year.

Entrance of Paradise City Casino, Yeongjongdo, Incheon [Photo by Paradise]

Paradise, a leading foreigner casino operator, announced on the 10th that its consolidated operating profit for the first quarter of this year was 19 billion KRW, turning profitable compared to the same period last year (operating loss of 25.5 billion KRW). During the same period, sales increased by 92% to 191.5 billion KRW, and net profit also turned positive at 9.5 billion KRW.

By subsidiary, Paradise Casino's sales rose 129% year-on-year to 71 billion KRW, and Paradise Segasami Casino's sales increased by 178.5% to 63.4 billion KRW.

The total drop amount (the amount customers paid to purchase chips) at Paradise Casino in the first quarter was 1.264 trillion KRW, slightly up from 1.248 trillion KRW in the previous quarter, and more than tripled compared to 359 billion KRW in the same period last year. Among these, the drop amount proportion of Japanese VIP customers was the highest at 56%.

A Paradise representative explained, "Since July last year, Japanese VIP customers have been entering in earnest, and with the resumption of the visa-free policy with Japan, sales centered on the Japanese market and mass (general) customers have been continuously increasing." They added, "With the easing of China's 'zero COVID' policy and the increase in flight routes, a gradual recovery of the Chinese market is expected in the second half of the year."

Grand Korea Leisure (GKL), a public enterprise operating foreigner-only casinos, also reported that its operating profit for the first quarter turned positive at 27.2 billion KRW, compared to an operating loss of 13.2 billion KRW in the same period last year. Sales increased by 133% to 109.2 billion KRW, and net profit turned positive at 21.6 billion KRW. During this period, the drop amount generated at GKL's three casino venues in Gangnam and Yongsan in Seoul, and Busan was 753.8 billion KRW, a 161.3% increase compared to the same period last year. The number of casino visitors was 145,000, up 113% from 68,000 in the same period last year.

A GKL representative stated, "To attract more Japanese VIP customers, we are strengthening local customer acquisition activities in Tokyo and Osaka, and plan to expand overseas marketing in other regions such as Taiwan, Hong Kong, and Mongolia."

Additionally, Kangwon Land, which allows both domestic and foreign visitors, saw its operating profit in the first quarter increase by 561.9% to 69.7 billion KRW compared to the same period last year. Sales rose 57.9% to 358.1 billion KRW, and net profit turned positive at 101.5 billion KRW, marking a performance rebound. Among Kangwon Land's first-quarter sales, casino sales were 306 billion KRW, up 59.2% year-on-year, and the total drop amount increased by 50.3% to 1.5005 trillion KRW. The number of visitors surged by 75% to 624,557.