South Korea Casino Operators Continue to See Mixed Results

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South Korea Casino Operators Continue to See Mixed Results

The global casino market continues struggling as it tries to fight off COVID-19. This is especially true of South Korea’s market, although there was one development that improved in 2021.

Paradise Jeju Grand
Paradise Jeju Grand
Paradise Co’s Jeju Grand casino in South Korea helped bolster the operator’s end-of-year revenue. However, overall, the figure slid for 2021.

Casinos in South Korea have seen their ups and downs as a result of the COVID-19 pandemic. As 2021 wrapped up and the final numbers were presented, the impact became clearer.

Paradise Co., which is behind Walkerhill in Seoul, Jeju Grand on Jeju island and Paradise City in Incheon and Busan, saw a 25.7% year-on-year drop in revenue. The final total for the foreigner-only casinos was  KRW249.76 billion (US$208.8 million). For the prior year, the figure was KRW335.97 billion (US$278.85 million).

Paradise Co Sees Revenue Dip as 2021 Progresses

A big loss was recorded late in the year. Paradise Co. saw its month-on-month revenue go from KRW21.35 billion (US$18.08 million) to KRW9.9 billion (US$8.38 million) between October and November. For the first 11 months of the year, the revenue total was 25% less than the same period in 2020.

The good news is that, in December, casino sales added 203% from November’s final amount, according to the operator’s announcement. This came off a 15.7% improvement in table drop, which closed at KRW159.85 billion (US$133.3 million).

That was also a 5.2% increase over the figure for December 2020. Sales fell, however, in the December-to-December comparison, coming in 30.1% lower.

Table game sales in 2021 marked a year-on-year drop of 27.1%, falling to KRW226.89 billion (US$189.2 million). Gaming machines lost 8.1% as the sales closed at KRW22.87 billion (US$19.1 million).

Overall, table drop lost 26.6% last year compared to 2020, only reaching KRW1.71 trillion (US$1.43 billion).

Grand Korea Leisure Co (GKL), the other foreigner-only casino operator in South Korea, saw similar results in November. Its gaming revenue dropped 55.9% from the previous month, settling at KRW4.09 billion (US$3.5 million). The full-year results haven’t been released.

Jeju Dream Tower Finds its Rhythm

Jeju Dream Tower, which was added to South Korea’s gaming landscape in June of last year, also saw a better December. The month was the first time its operator, Lotte Tour Development Co Ltd, was able to report a positive EBITDA (earnings before interest, taxes, depreciation and amortization).

Located on the once-bustling Jeju Island, the property saw EBITDA of KRW1.48 billion (US$1.23 million) last month. This was made possible, in part, thanks to the KRW8.13 billion (US$6.75 million) in gaming revenue received.

All three of the property’s business segments, which are listed as casino, hotel and retail, performed better. The total sales revenue was approximately KRW20 billion ($16.61 million), with the all-suite hotel providing the biggest improvement. The Grand Hyatt property took in a new record of KRW11.5 billion (US$9.55 million), according to a company press release.

The figures for 2022 will likely be better, provided South Korea can keep COVID-19 under control. A second hotel tower opened at the end of November, bringing the total number of hotel rooms to 1,552.

GKL has begun the new year with a small step backwards. Its Gangnam COEX casino in Seoul shut down as of 10 AM local time on Wednesday and won’t open until sometime on Friday. The decision was taken after eight employees were determined to be infected with COVID-19.

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