Imperial Pacific International reported a more than 77 percent drop in 2019 revenue and a wider loss as its VIP business dried up.
The Hong Kong-listed company said revenue for the year was HK$539.2 million ($69.5 million), compared with $3.25 billion the prior year. IPI said the decline was due to a drop in VIP table games roll, which fell to $14.02 billion, from $126.2 billion the prior year.
The group, which operates the only casino on Saipan, attributed the fall to adverse market conditions as a result of the U.S./China trade tensions and the tightening of marker credits. The operator is still only working with one junket operator and otherwise is involved in direct marketing and extension of credit to its VIP guests.
The loss attributable to owners of the company rose to $3.9 billion, as compared with a loss attributable of $2.96 billion last year. A provision for impairment on trade receivables, income tax expenses and an increase in finance costs also contributed to the wider loss.
Revenue from mass gaming operations amounted to $186 million, down slightly from $209 million in 2018.
The property has been shut since March 17 due to the impact of the coronavirus and the group said a prolonged closure will have a material impact on business. However, it said it remains optimistic about long-term prospects for tourism on Saipan.
The villa resort at the Imperial Palace Saipan has been partially ready for operation since December last year and the company has been test running six of the luxury units, which will give it greater capacity to service VIP guests. Its Imperial Casha Hotel will provide more than 1000 rooms when completed.
IPI said it had spent an additional $87 million during the year on design and construction taking total investment to date to $879 million.
The group’s auditors – Ernst & Young – one again flagged “material uncertainty which may cast significant doubt on the Group’s ability to continue as a going concern.”