otal losses for the group for the period amounted to HK$410.5 million, as compared to HK$11.9 million for the same period in 2015.
The group justified the losses as being due to a "one-off loss on disposal of patents and patent applications" worth over HK$334 million, ‘resulting from the grant of exclusive rights to IGT [gaming company] involving assignment of certain patents and associated technology,’ notes the group in the filing.
Revenue for the period amounted to HK$519.8 million, a nine per cent drop year-on-year, down from HK$571 million.
"Such decrease was attributable to the decrease in gross gaming revenue of the Group’s casino management business, mainly driven by the diminishing growth rate in China and the anti-corruption campaign by the Central Government of China," notes the filing
The group’s provision of casino services segment contributed 77.5 per cent of the group’s total revenue for the period, which it noted was dragged down by a drop in the number of tourists visiting Macau. "The Group is awaiting the Macau government to promulgate more effective supportive policies in order to revitalise the economy of Macau," it comments.
The group’s Live Multi Game (LMG) terminal segment contributed to the remaining revenue received over the first six months of the year, at 22.5 per cent. It noted that during the period, it deployed 70 of the LMG terminals to the Casino Diamond in the Holiday Inn Macau, as well as 50 LMG terminals to the Flamingo Slot Club, located at Macau Fisherman’s Wharf. These deployments "serve as a vote of confidence" in the terminals’ "ability to drive performance for casino operators," it opines, while noting that the sales "further demonstrate the growing popularity and acceptance of LMG terminals for both casino operators and players."
In regards to the future, the group notes that it will remain ‘cautiously optimistic’ and strive to promote and develop the existing gaming market in the MSAR
The filing notes that "some cheer for the Macau gaming industry" was felt given that ‘the Macau government is trying to find leeway to allow the set up of smoking rooms in casinos,’ and not pursue a full smoking ban, which "might deter certain gamers and affect casino revenues," it notes.
The group’s Macau operations are not affected by an agreement, signed in April of this year, to grant IGT the exclusive rights to make, sell and "otherwise exploit" the group’s licensed products worldwide. These rights include the assignment and license of certain patents and associated technology. Despite the one-off loss that this entailed, the group’s report notes that as of end-June ‘the cash and cash equivalents on hand and available financial resources were sufficient for financing the ongoing activities of the Group’.
