GKL profit falls as casino costs rise
Grand Korea Leisure (GKL), the South Korean operator of Seven Luck casinos, reported a 52.6% year-on-year decline in third-quarter net profit as higher costs weighed on largely unchanged revenue. Net income totaled KRW6,952 million for the three months ended September 30, compared with KRW14,669 million a year earlier, according to its November 10 preliminary earnings disclosure.
Consolidated quarterly revenue reached KRW109,674 million, up 0.3% from KRW109,383 million in the corresponding period of 2025. The year-on-year stability contrasted with a weaker sequential performance: revenue fell 8.9% from KRW120,451 million in the second quarter, while net profit declined 61.4% from KRW18,015 million.
Operating profit fell 44.4% year on year to KRW9,623 million. GKL’s operating margin narrowed to 8.8%, compared with 15.8% a year earlier and 17.3% in the preceding quarter. The deterioration shows that maintaining revenue around the previous year’s level was insufficient to protect profitability as operating expenses increased.
Cost of sales rose 8.0% year on year to KRW89.96 billion, with higher wages, employee benefits and sales-promotion spending contributing to the increase. Selling, general and administrative expenses also climbed, rising 15.5% to KRW10.09 billion. Together, these increases placed pressure on earnings despite the modest improvement in quarterly revenue.
Nine-month revenue growth fails to lift earnings
Financing expenses added another source of pressure, reaching KRW2.99 billion compared with KRW285 million a year earlier. Profit before tax fell 53.6% to KRW8,726 million, according to the earnings disclosure. The decline therefore extended beyond operating performance, with the higher financing burden also affecting the amount of profit reaching the bottom line.
For the first nine months of 2026, consolidated revenue increased 6.4% to KRW340,777 million from KRW320,188 million. Earnings moved in the opposite direction: operating profit decreased 9.1% to KRW48,606 million, while net income fell 16.1% to KRW40,060 million. The cumulative figures indicate that stronger revenue across the reporting period had not translated into higher profits.
Underlying casino activity nevertheless increased. GKL reported a nine-month drop — the amount customers exchange for gaming chips — of KRW2.97 trillion, up 9.5% year on year. Net casino sales rose 5.8% to KRW337.2 billion, while the hold rate declined to 11.3% from 11.7%. The lower hold rate helps explain why growth in casino sales lagged the increase in chip purchases.
GKL operates three foreigner-only Seven Luck casinos, with two in Seoul and one in Busan. Its preliminary results cover the consolidated group. The company cautioned in its filing that the third-quarter figures had been prepared before completion of the external audit and could change during that process, meaning the November announcement should be treated as provisional.
