Palasino Group profit falls in FY24 on costs linked to emerging online gaming business

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Hong Kong-listed Palasino Group reported Wednesday a FY24 profit of HK$9 million (US$1.2 million), down from HK$44 million (US$1.2 million) in the prior year due primarily to one-off expenses and online gaming expenses as it establishes its Europe-facing online gaming business.

However, the group saw its revenue increase by 7% year-on-year to HK$564.3 million (US$72.3 million) – of which HK$402.4 million (US$51.5 million) was from gaming operations – while Adjusted EBITDA was stable year-on-year at HK$85 million (US$10.9 million).

Palasino, which operates three casinos in the Czech Republic plus hotels in Germany and Austria, was previously an arm of Hong Kong real estate giant Far East Consortium (FEC) before spinning off and listing on the Hong Kong Exchange in March. FEC is also closely linked with Australia’s Star Entertainment Group, holding a 4.99% stake in the company and a 25% stake in a joint venture integrated resort development in Brisbane alongside Star and Chow Tai Fook.

In releasing its FY24 results on Wednesday, Palasino revealed a number of expansion initiatives in both the land-based and online space. The group recently acquired a shopping mall in Mikulov, Czech Republic, which it intends to convert into a casino and has lodged a casino license tender application in Poland.

It also holds an online casino license in Malta, has plans to apply for an online gaming license in the Czech Republic within this year and said that, aside from its B2C business, is also exploring B2B opportunities. The company recently incorporated a wholly owned subsidiary, Palasino Technology (HK) Limited and signed a non-legally binding memorandum of understanding with GameSparcs Co Ltd to license online game content to target opportunities in Asia.

Costs around the online gaming business amounted to HK$21 million (US$2.7 million) in FY24, Palasino said, adding that Adjusted EBITDA would have reached HK$106 million (US$13.6 million) had it not been for these costs.