Lotte Tourism Development, Record-Breaking Q1 Revenue and Surging Profits Driven by Casino and Hotel Dual Engines

*This content was translated by AI.

Despite turmoil in the Middle East, Lotte Tourism Development achieved explosive operating profit growth in the first quarter, more than doubling compared to the same period last year. The company assessed that it has officially entered a phase of "qualitative high-level growth."

In a quarterly report filed on the 14th, Lotte Tourism Development announced first-quarter revenue of 156.2 billion won (consolidated) and operating profit of 28.8 billion won.

While revenue growth was 14.8% year-on-year in the first quarter of last year (from 106.2 billion won to 121.9 billion won), this year it recorded a steep 28.1% growth rate, marking the first time quarterly revenue has reached the 150 billion won level.

Notably, while operating profit growth was 48.2% year-on-year in the first quarter of last year (from 8.8 billion won to 13 billion won), this year it surged 121% (from 13 billion won to 28.8 billion won), causing operating profit growth to skyrocket by 2.5 times.

Alongside this, the operating profit margin showed a steep upward trend, rising from 8.3% in the first quarter of 2024 to 10.7% in 2025 and 18.4% in 2026.

Consolidated net loss also improved significantly, shrinking from a 23.7 billion won deficit in the same period last year to a 7.5 billion won deficit in the first quarter, despite it being the off-season. This situation signals a massive growth trend for the company's full-year results this year.

Lotte Tourism Development stated, "While revenue grew 28.1% year-on-year in the first quarter, operating expenses increased by only 17%, leading to a significantly wider operating profit margin. We expect the operating leverage effect, where profits grow at an increasingly faster rate as revenue increases, to become fully operational starting this year."

This remarkable growth is primarily attributed to the joint success of its two main business segments: the casino (Dream Tower Casino) and the hotel (Grand Hyatt Jeju).

First-quarter casino revenue reached 118.63 billion won, a 40.3% surge compared to the same period last year (84.55 billion won).

Casino visitor numbers rose sharply by 37.3% to 150,053, up from 109,631 in the first quarter of last year. Table drop amounts also climbed 36.7% year-on-year to 573.87 billion won (from 419.68 billion won). The table hold rate was 19.7%, a slight increase of 0.7 percentage points from 19.0% in the same period last year, approaching the 20th% range.

Market experts are noting that the hold rate of Jeju Dream Tower Complex Resort, Korea's representative stay-type casino, has risen to 22.6% in April following the first quarter, nearing the 26.1% average hold rate (2025) of nine ultra-large complex resort casinos in the Cotai area of Macau, including Galaxy and The Venetian, which boast the world's highest profitability.

Hotel revenue also grew 20.2% year-on-year to 38.14 billion won (from 31.72 billion won). Room sales surged 37.1% to 109,233 rooms in the first quarter, up from 79,692 rooms in the same period last year, causing the off-season occupancy rate (OCC) to jump from 55.3% to 75.9%.

The proportion of foreign guests increased from 66.8% to 73.5%, further solidifying Jeju's status as a landmark that foreign tourists must visit.

Alongside room sales, the food and beverage (F&B) sector, staffed by numerous global chefs, saw revenue increase by 24.1% to 9.54 billion won, driven by a 14.5% rise in customer visits to 280,053.

Lotte Tourism stated, "Despite concerns over the Middle East situation and off-season challenges, we demonstrated record-breaking revenue and explosive profit generation in the first quarter. With the official tourism season approaching, full-year results this year are expected to show a definite quantum leap."

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*This content was translated by AI.