Can you win and lose at the same time? The answer is yes for Hong Kong-listed Asia Pioneer Entertainment Holdings Ltd. While losses grew to date this year, revenues and gross margins improved.
The Macau-based distributor of gaming equipment earns profits from selling and services slot machines and electronic table games. There is no doubt plenty of business.
Asia Pioneer recently filed a report with the exchange, reporting HKD2.7 million ($345,000) in the nine months ending on September 30. However, the company had just reported a loss of over HKD1.6 million ($200,00) for the same period in 2018.
It is not surprising that losses came from rising expenses. Asia Pioneer had previously recorded total expenses of HKD15.8 million ($2.02 million). But the number rose to HKD24.1 million ($3.08 million) from January through September in 2019.
Among the reported expenses is a whopping 133.5% increase in directors’ remuneration. In addition, employee and other staff costs jumped.
The winning side of the coin
The picture wasn’t all bad for Asia Pioneer, however, as revenues were on the positive side of the coin. Looking at the period ending September 30, we see a 31.4% increase in revenue at HKD53.5 million ($6.84 million).
The income spurt came from technical sales and distribution of electronic gaming equipment along with spare parts.
Better returns were not unexpected in spite of losses and initial low revenues for Q1. In May, the company told the exchange that management is confident that the group’s loss in the period would be reversed with new orders in the pipeline for the remainder of the year.
“In technical sales and distribution, we are in discussions with several customers in [the] Macau SAR and Southeast Asia, including planned new casinos in [the] Macau SAR.”
This prediction came to fruition with a likely positive impact on the fourth quarter to come.