SEOUL: Kangwon Land Inc, the operator of the only casino resort in South Korea where the country’s nationals are allowed to gamble, reported net income of KRW142.81 billion (US$122.1 million) for the first quarter of 2016, up by 7.9 percent from the prior-year period. Revenue increased 2.6 percent year-on-year to KRW436.57 billion in the three months to March 31. Operating income for the period grew by 5.0 percent to KRW177.88 billion, the firm said in a filing to the Korea Exchange on Wednesday.
Kangwon Land also posted sequential improvements in net income and revenue – 53.6 percent and 7.6 percent respectively. Thomas Kwon, an analyst at Daiwa Securities Capital Markets Korea Co Ltd, stated in a note following Kangwon Land’s first quarter results announcement that the firm’s “solid” performance was due to “strong revenue from slot machines and strict cost controls” at the firm’s only casino resort (pictured). He added that Kangwon Land’s management expected its earnings growth momentum to “accelerate” into the second half of 2016, driven by a rise in the utilisation rate of casino tables, growing visitor traffic, a gradual recovery in VIP business and improved cost controls.
Mr Kwon added: “In our view, the revenue-growth drivers for 2016-2018 are an increase in the number of casual gamers, the opening of the second Yeongdong Highway in late-2016 and the opening of [Kangwon Land’s] water theme park in summer 2018.” The second Yeongdong Highway will connect Gwangju in Gyeonggi province and Wonju in Gangwon province. It is expected to increase accessibility to the Kangwon Land casino resort, which is located in an upland area of Gangwon province, 150 kilometres (93 miles) from the country’s capital Seoul.
