China Star Entertainment warns of loss

China Star Entertainment said it expects to post a loss in 2016 due to the downturn in service income from its gaming operations in Macau as well as a loss incurred on new film releases.

The company, which owns the Hotel Lan Kwai Fong (Macau), said it is likely to record a loss of between HK$320 million ($41.1 million) and $360 million, compared with a profit of $107.8 million for the prior year, China Star said in a statement to the Hong Kong Stock Exchange.

The loss is due to a “significant decrease in revenue for service income from gaming operations as a result of the recession in gaming industry in Macau and the loss incurred in the new film released during the year in the amount of approximately HK$220 million”

It was also impacted by the recognition of unrealised loss of approximately HK$19 million arising on change in fair value of financial assets classified as held for trading investments as compared to unrealised gain of HK$99.6 million gain recognised in the previous year and the recognition of a loss on fair value change of investment properties of approximately HK$33 million during this year.