Disposal of patents and patent applications has dampen gaming technology provider Paradise Entertainment Limited’s revenues, resulting to a more than 33-fold net loss for the first six months of the year.
From a HK$ 23.9 million (US$ 3.08 million) losses in January to June period last year, the HongKong-listed firm saw its losses surge to HK$410.5 million (US$53.7 million) in the first half of 2016.
Paradise attributed the losses to the one-off loss on its patents and patent applications deal with gaming systems company International Game Technology Plc (IGT), which cost them HK$334.8 million (US$ 43.16 million).
Except from table game intellectual property used exclusively in Macau, Paradise agreed to transfer all of its electronic table game to IGT in April. Over 77 percent of Paradise’s H1 revenues came from its group’s casino services segment.
Meanwhile, Paradise’ revenue for the January-June period dropped by nine percent to HK$519.8 million (US$67.01 million) from HK$571 million (US$ 73.62 million).
“Such decrease was attributable to the decrease in gross gaming revenue of the Group’s casino management business, mainly driven by the diminishing economic growth rate in China and the anti-corruption campaign by the Central Government of China,” Paradise reported in a filing to the HongKong Stock Exchange on Friday. “The Group is awaiting the Macau government to promulgate more effective supportive policies in order to revitalise the economy of Macau.”
The firm, however, pointed out that its Macau operations were not affected by the agreement to grant IGT the exclusive rights to make and sell the group’s licensed products worldwide.
“The group believes that the grant of the exclusive rights to IGT not only boost the sales and popularity of the LMG in the U.S. but also pave the best path to create value for the group … and increase the revenue base of the group,” Paradise explained.
As for its Live Multi Game (LMG) Terminal segment, Paradise noted that it has deployed 70 of the 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.
The firm said that its LMG terminal segment, which makes up the remaining revenue for the first half of 2016, “serve as a vote of confidence’ in the terminals’ ‘ability to drive performance for casino operators.”
Looking forward, Paradise said that it “remains cautiously optimistic” about the future.
“[The firm] will continue to execute the established business strategies while at the same time striving to promote and develop the existing Macau gaming market.”