International Entertainment reports $17M loss despite gaming revenue growth

Hong Kong-listed International Entertainment Corp has reported a shift from profit to loss for the fiscal year ending June 30th, 2024, despite growth in gaming revenue.

According to the latest financial results, the group announced a loss attributable to its owners of nearly HK$132 million ($17 million) for the fiscal year. This represents a significant decline from a profit of approximately HK$18.3 million in the previous year, as disclosed in a filing on Wednesday. The company did not recommend a final dividend for this period.
Despite the financial loss, International Entertainment experienced a 10.9 percent year-on-year increase in total revenue. The group's revenue from gaming operations reached nearly HK$170 million ($21.8 million), reflecting a 27.3 percent increase compared to the prior year. 
This growth was largely attributed to the commencement of revenue generation under a provisional gaming license obtained in May 2024, following the company's takeover of casino operations at the New Coast Hotel Manila.
Before launching its gaming business, the group primarily generated revenue through leasing properties to the Philippine Amusement and Gaming Corp (PAGCOR). The recent increase in gaming revenue reflects the early benefits of the new operational model. Conversely, revenue from hotel operations declined to approximately HK$59.8 million, down 18.8 percent year-on-year, largely due to ongoing renovations aimed at upgrading hotel facilities.
The financial loss for the year was significantly influenced by a sharp rise in general and administrative expenses, which surged by 110.9 percent to approximately HK$204.6 million ($26.3 million). Of these expenses, around 42.1 percent were related to staff costs, along with a one-time expense of about HK$40.9 million ($5.3 million) incurred in connection with obtaining the provisional gaming license.
In its filing, the board expressed optimism regarding the provisional license, viewing it as a crucial opportunity to diversify into the gaming and entertainment sectors alongside its existing hotel operations in the Philippines. The company previously announced plans to invest between $1.0 billion and $1.2 billion in developing an integrated resort in Manila, an undertaking linked to its agreement with PAGCOR.
This project will involve the renovation and expansion of the New Coast Hotel Manila, managed by Marina Square Properties Inc., a subsidiary of International Entertainment. To finance this expansion, the board will explore various options, including bank loans and equity financing, to bolster the group's liquidity and growth.

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