International Entertainment Corporation (IEC) expects its net loss to widen significantly for the financial year ended June 30 2026, although the company said its underlying gaming business continued to strengthen.
In a profit warning filed with the Hong Kong Stock Exchange, the company said it expects a loss attributable to shareholders of approximately HK$500m, compared with a loss of HK$282.1m in the previous financial year.
Despite the weaker bottom line, IEC said gross profit increased during the year, supported by higher gaming revenue from both its land-based casino operations and its gaming platform services provided to other licensed gaming operators.
The company attributed most of the larger loss to a HK$425m non-cash accounting charge arising from changes in the fair value of financial liabilities linked to HK$1.6bn in convertible notes issued during the period. IEC stressed that the adjustment is required under Hong Kong accounting standards and does not affect its day-to-day operations or operating cash flow.
Excluding the non-cash fair value adjustment, the company said it would have reported a narrower loss than in the previous year.
IEC also cited higher selling and marketing expenses as another factor weighing on earnings, reflecting increased promotional campaigns designed to strengthen the competitiveness and appeal of its casino business.
The company added that its auditors are continuing to assess whether any impairment charges will be required. Should an impairment be recognised, the reported loss could increase further.
The profit warning comes just weeks after IEC expanded its presence in the Philippines' online gaming market. In June, its indirect subsidiary New Coast Leisure Inc. entered into an agreement with DigiPlus subsidiary Total Gamezone Xtreme Inc. to integrate and operate approved online gaming content through the platform connected to LaVie Resort & Casino Manila.
Under the partnership, New Coast Leisure will retain responsibility for regulatory compliance and maintaining its PAGCOR online gaming licence, while DigiPlus will provide the gaming software, systems and content aggregation services.
IEC has previously described the Philippine online gaming sector as a significant long-term growth opportunity, citing favourable regulation, technological advances and increasing consumer demand.
International Entertainment is scheduled to publish its full FY2026 results on August 28
