Relaxation of Safety Tourism Regulations Gangwon Paradise Corriton
Consumer demand for gambling services at Kangwon Land, the country’s only casino operator, is likely to recover more easily than at foreign-only venues run by Paradise, as both companies resume operating casinos after the COVID-19 shutdown.
But while the two companies’ specific challenges are somewhat different, they face uncertainty, including capacity constraints related to so-called social distancing measures. A note from each of them published by JP Morgan Securities (Asia-Pacific) Ltd on Wednesday shows.
Kangwon Land Casino was temporarily closed on Feb. 23 as a local precaution against the spread of COVID-19 infections. Some casinos did not reopen until May 8 due to repeated extended closures.
“It’s comfortable to expect a quick recovery in demand when business normalizes, but I can’t help but think that capacity normalization won’t happen (at least) for a few quarters,” JPMorgan analyst DS Kim said of the locally licensed venue operator
Paradise Co. reopened its casinos on Jeju Island on Apr. 13. It resumed operations at the other three game venues in mainland Korea on Apr. 20.
Kim and his colleagues Derek Choi and Jeremy An said of Paradise Co. “Demand is not active because there are no ‘inbound gamblers’ due to strict border controls and extremely limited flight options.”
They added: “Its revenues have only come from ‘local expats’ since reopening, a trend that should continue until border controls are eased in South Korea.”
Analysts mentioned several measures that are still in place, including a 14-day quarantine for those wishing to enter Korea, similar measures in mainland China for residents returning from abroad, and a “suspension” on Korea-Japan visas since March ” amid heightened political tensions.” Mainland China and Japan are the main markets for foreign-only casino companies in Korea, according to their respective company documents.
On Tuesday, Paradise reported a first-quarter loss of 2.46 billion won, down from 7.53 billion won a year earlier. JPMorgan said its second-quarter earnings would be “much worse.”
The agency expects demand to stabilize “from July” on hopes Paradise will ease its border controls by the end of June and that game declines will recover to “75%” in the third quarter from a year ago and to “85%-90%” in the fourth quarter.
Paradise will only be able to see its sales “fully recover” to 2019 levels next year, JPMorgan estimated.
In a note to Kangwon Land, which also reported a first-quarter loss on Tuesday, the JPMorgan team expected “capability normalization” to not happen for at least “a few more quarters.”
BY: 릴게임사이트