Kangwon Land, the casino operator, experienced a significant loss mainly due to a sharp decline in revenue, which dropped by 68.5% year-on-year to KRW478.58bn.
The costs of sales exceeded the revenue, totaling KRW544.5bn. Out of this total, KRW294.5bn came from casinos, down by 36.2%, and KRW119.3bn came from hotels, down by 17.3%.
In addition to its core operations in the casinos and hotels, Kangwon Land generated revenue from condo rentals amounting to KRW55.6bn and the High1 ski resort of KRW350.0m.
This resulted in a gross loss of KRW65.9bn, a significant decrease compared to the KRW783.4bn gross profit in 2019.
After accounting for management fees and development expenses, Kangwon Land’s operating loss amounted to KRW431.58bn, compared to a profit of KRW501.15bn in the previous year.
The business reported non-operating income of KRW1.7bn and financial income of KRW56.6bn. However, it had to bear non-operating costs of KRW47.6bn, resulting in a pre-tax loss of KRW404.5bn.
After considering the income tax benefit of KRW128.6bn, Kangwon Land ultimately suffered a net loss of KRW275.86bn, a significant decrease from the KRW334.66bn profit in the previous year.
In the last quarter of the year, Kangwon Land’s revenue declined by 64.8% to KRW131.3bn. The majority of this revenue, KRW117.2bn, came from casino gaming, experiencing a decline of 64.7%.
The non-casino sales contributed KRW14.1bn, with the majority of it coming from hotels (KRW9.0bn). Condos accounted for KRW2.3bn, golf for KRW1.5bn, and ski resorts for KRW1.1bn.
The total costs of sales, including salaries, taxes, and other expenses, declined by 35.2% to KRW153.2bn. This led to a gross loss of KRW21.8bn and an operating loss of KRW76.1bn after considering management fees.
Despite some financial and non-operating income, Kangwon Land incurred a pre-tax loss of KRW56.6bn. After accounting for a tax benefit of KRW23.3bn, the net loss amounted to KRW33.3bn.
Kangwon Land faced multiple closures in its flagship venue in Jeongseong, which negatively impacted its operations. The closures initially intended for a short duration ended up lasting for months.
