Net losses recorded by South Korean gaming operator Shin Hwa World are expected to continue to expand in the first half of this year, the group announced, mainly due to increased competition and domestic tourists now being able to travel abroad following the easing of travel restrictions.
Shin Hwa World controls Jeju Shinhwa World, a resort with a foreigner-only casino on the South Korean holiday island of Jeju
The group noted in a profit warning not it is expected to record a consolidated net loss of approximately HK$310 million (US$39.6 million) to HK$370 million for the six months ended 30 June 2023, as compared to the consolidated net loss of approximately HK$105 million for the corresponding period in 2022.
Shin Hwa World attributed the expanding losses to many factors, including pressure on the room price and occupancy rate due to intense competition and domestic customers travelling abroad after the easing of travel restrictions, leading to a decrease in
revenue generated from the integrated resort development segment.
Other factors included a decrease in residential property sales owing to the downturn in the property market and the increasing
interest rate; an increase in operating expenses resulting from inflation, particularly utility costs and spending on facilities maintenance, as well as an increase in employee benefit expenses; and a decrease in fair value gain of investment properties.
The group’s full interim results announcement should be published later this month.
Last month, the Korean company announced its Chairman of the Board, Dr. Yang Zhihui, is retiring from the position, as well as from his Executive Director role, with Chan Mee Sze serving as Acting Chairperson in the interim.