Kangwon Land, a South Korean gambling establishment and holiday destination, recorded a deficit of 275.8 billion won ($250.2 million) in 2020 due to the global health crisis. The resort was compelled to shut down for extended periods, leading to a 68.5% decline in earnings to 478.5 billion won.
Despite a 26.1% reduction in expenditures, the cost of goods sold surpassed revenue at 544.5 billion won. Of this, 294.5 billion won originated from the gambling area, a 36.2% decrease, and 119.3 billion won from the hotel, a 17.3% decrease. The company also generated 55.6 billion won from condo rentals and 350 million won from the High1 ski resort.
This resulted in a gross deficit of 65.9 billion won, in contrast to a gross gain of 783.4 billion won in 2019.
After paying 140.7 billion won in general and administrative expenses and 225 billion won for transforming the closed mine into a new resort, Kangwon Land recorded an operating deficit of 431.5 billion won. This contrasts with a profit of 501.1 billion won in 2019.
The company reported 17 billion won in non-operating revenue and 56.6 billion won in financial revenue, but paid 47.6 billion won in non-operating expenses, resulting in a pre-tax deficit of 404.5 billion won. After receiving 12.8 billion won…
Kangwon Land, despite being granted a tax break of 60 billion won, experienced a net loss of 275.8 billion won, a considerable reduction from the 334.6 billion won profit recorded in the prior year.
The final quarter of the year saw a 64.8% decrease in earnings, reaching 131.3 billion won. Of this total, 117.2 billion won originated from casino games, indicating a 64.7% decline. The remaining 14.1 billion won, derived from other sources, experienced a 65.7% drop.
The 117.2 billion won in casino earnings were generated from slot machines (48 billion won), general table games (45.8 billion won), and VIP rooms (32.6 billion won), after subtracting a bonus fund of 9.2 billion won.
A total of 122,532 players wagered 528.6 billion won at Kangwon Land’s casino in the final quarter, a reduction from the 696,121 players in the fourth quarter of 2019. International customer traffic also declined from 8,124 in 2019 to 566.
Of the 14.1 billion won in non-casino earnings, hotel revenue was the highest at 9 billion won, followed by condo revenue at 2.3 billion won, golf revenue at 1.5 billion won, and ski resort revenue at 1.1 billion won.
However, the cost of goods sold decreased by 35.2% to 153.2 billion won. This cost included salaries (67.7 billion won, a 25.7% decrease), tourism development fund (12.6 billion won), and sales tax (6.6 billion won).
This resulted in a gross loss of 21.8 billion won. Operating loss, excluding management and administrative expenses, reached 76.1 billion won.
Kangwon Land recorded 19.6 billion won in financial income and 8.7 billion won in non-operating income. However, non-operating expenses amounted to 8.8 billion won, resulting in a pre-tax loss of 56.6 billion won. Kangwon Land’s net loss was…
A tax reduction of 3 billion South Korean won, resulting in a total of 33.3 billion South Korean won.
The operator’s primary gambling establishment in Jeongseon initially shut down on February 23rd. It resumed operations in July, but closed again less than two months later. The closure was initially scheduled for two days, but ultimately lasted nearly two months.
It shut down once more on December 8th.
Image: Laser Paradise/CC BY-SA
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