Imperial Pacific 1H net loss expands to 21.8 million

Hong Kong-listed Imperial Pacific International Holdings Ltd on Thursday posted a net loss of HK$168.8 million in the first half of 2015, compared with HK$19.6 million a year ago.

The company said sales fell 52.9% year-over-year to HK$138.2 million in the period, while administrative costs rose about 400% to HK$167.9 million.

Imperial Pacific holds a casino license in Saipan, Pacific Island, and is also an investor in the revenue stream of Hengsung Group, a Macau junket company also known as Hengsung Group.

Imperial Pacific said it recognized impairment losses related to its investment in Hengyung. It reported cumulative revenue of about HK$6,000 from its Macau gaming business in the six months to June 30, losing about HK$3 million during the period. That compared with HK$11.8 million in segment profit in the prior year.

"As sales generated during the period continue to decline, expected cash inflows from this business segment have decreased, recognizing an impairment loss of approximately HK$3,000,000 in relation to intangible assets," Imperial Pacific said.

Macau Casino gross gaming revenue (GGR) in the first half of 2015 was 37.0% lower than in the same period in 2014, while VIP Baccarat GGR declined 42.2% year-on-year in the second quarter.

Following the investment in Hengsheng, the supplier deposited HKD 376 million in revenue guarantees in Imperial Pacific for the period from January 1, 2015 to December 31, 2029. Imperial Pacific said its guaranteed profit share applicable through December 31, 2017 was HK$72 million.

"These proceeds were used to develop an integrated resort business on Saipan Island," it added.

Imperial Pacific confirmed in a filing on Thursday that Saipan's "temporary casino," which began generating gaming revenue, was soft-opened on July 26, outside the reporting period.

The company also began construction of the site in July for two hotels with a total of 254 rooms and casinos in Saipan. Construction will be "completely completed within 16 months," it said.

Imperial Pacific said the business segment was in the development phase in the first half of 2015 and posted a loss of about HK$127.6 million, compared with HK$14 million a year earlier.

Last September, Imperial Pacific pledged $7 billion to spend on casino resorts in Saipan. 바다이야기