Iao Kun Group shares tumble after earnings disappoint

    Shares in Iao Kun Group Holding tumbled 6 percent in Nasdaq trading after the VIP gaming room promoter posted weaker-than-expected Q2 results, with both revenue and earnings missing analysts’ expectations.IKGH posted a Q2 net loss of $7.5 million, or $0.12 per diluted share, compared to net income of $9.1 million, or $0.20 per diluted share in Q2 2013. Analysts were expecting EPS of $0.04 per share, according to Capital IQ.Revenues fell 22 percent year-on-year to $49.7 million, missing the consensus of $60.6 million. Rolling Chip Turnover increased 5 percent year-on-year to $4.5 billion.

    The company blamed a lower win rate of 2.18 percent compared to a win rate of 3.06 percent for prior year, slower revenue growth of VIP baccarat compared to the overall growth of gaming revenue in Macau and the economic downturn and tightening of credit in mainland China for the drop in earnings.The company said it’s maintaining its full-year 2014 Rolling Chip Turnover guidance for its five existing VIP rooms in Macau of $17 billion-$19 billion.