The Covid-19 pandemic has been harsh on the casino industry in South Korea but no one knew how bad. However, we are beginning to see the affects as Casino companies are divulging their 2020 profit/loss reports. Therefore, it is no surprise to investors that Grand Korea Leisure Lost $58 million in 2020.
According to casino forums, Grand Korea Leisure just made an announcement about their 2020 earnings. The reports says that they lost KRW64.3 billion which is around $57.9 million. Therefore, this is a huge loss as it is down $123.0 million on the profit of $65.1 million from FY19.
Grand Korea Leisure Lost $58 million in 2020 because of the Pandemic
Grand Korea Leisure is a popular foreigner-only casino company in South Korea. However, 2020 was a difficult year and they saw their sales decline by 63% in comparison to the previous year. According to the company, “Sale and profits declined due to business closures and restrictions on entry”. This is because the casino had to close its doors back in November of 2020 due to the pandemic.
In addition, they had plans to reopen in December and then January but they keep having to postpone their reopening. Last December, they made an announcement to not reopen until January 2021. Unfortunately, the once again had to postpone the reopening until mid-February. This applies to Gangnam COEX, Gangbuk Millenium Seoul Hilton and Seven Luck Casino in Busan Lotte.
Therefore, the results of these closures led to a difficult Q4 with $29.4 million in losses in comparison to 3Q20. In addition, casino sales from FY20 fell to 63.3% year-on-year to $182.2 million. On the other hand, the company saw a 33.2% decline in the cost of sales to $214.5 million.
Several gambling analysts believe their losses would have been much less if online casino gambling was legal in South Korea. Grand Korea Leisure is a subsidiary of the Korea Tourism Organization. In turn, the KTO is part of the Ministry of Culture, Sports and Tourism.
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