In a Wednesday filing with the Korea Exchange, Kangwon Land posted second quarter 2017 profits of KRW110.4 billion (US$96.9 million), down 10.7 percent from the same quarter in 2016. Kangwon Land is located in the remote village of Sabuk-eup in Gangwon Province more than 3 hours away from Seoul. It is the only casino in the country that allows Koreans to gamble.

In a note Wednesday, JP Morgan Securities analysts DS Kim and Sean Zhuang said: “Kangwon Land’s second quarter was weak, with operating profit falling 15 per cent year-on-year and missing estimates by [about] 10 per cent, dragged by a lower-than-expected top line. Quarterly operating income clocked in at KRW135.5 billion (US$ 118.7m).

“The disappointment came from mass [market gaming] (which was down nine per cent year-on-year) and slots (down some seven per cent), while VIP (with a three per cent decline) didn’t help either. In our view, this seemingly reflects Kangwon Land’s efforts to ‘adjust’ revenues lower amid regulatory scrutiny, and the timing of business normalization remains frustratingly uncertain,” the analysts noted according to multiple media outlets.

It was pointed out that the casino’s performance was the worst seen in over five years. Gross gaming revenue was down six percent (to US$338.9m) and non-gaming revenue was up by over 11 percent to US$10.51m, but it wasn’t enough to help the overall numbers.

The fall in revenue was seen as a result of Kangwon Land’s “efforts to adjust its revenues to avoid further regulatory scrutiny,” with the analysts indicating the casino has reduced the number of active tables from a maximum capacity of 180 to only 130 and made some 160-260 slots go dark compared to a couple of quarters ago when all 1,360 slots and video game machines were in operation.

“Considering its tables and slots are almost always fully occupied, lower active capacity inevitably leads to lower revenues, as seen in first quarter and second quarter trends,” Kim and Zhuan added, according to a report in GGRAsia.

The same report quoted Daiwa Securities Group Inc analyst Thomas Y. Kwon as saying that Kangwon Land could return to growth next year. “We forecast Kangwon Land’s revenue and earnings to grow 9.6 percent year-on-year and 12.6 percent year-on-year in 2018,” said Kwon.