IEC Issues FY26 Profit Warning After Non-Cash Charge on Convertible Notes Issued to DigiPlus
TL;DR — IEC expects a HK$500 million (US$63.8 million) FY26 loss, widened by a HK$425 million non-cash fair value charge on notes issued to DigiPlus. Excluding the charge, the company forecasts a narrowed loss. Conversion would give DigiPlus a 53.89% stake alongside a new online gaming launch at LaVie.
SCCG Take — The accounting charge masks a narrowed operational loss at LaVie despite higher marketing costs. The pending DigiPlus stake and online cooperation signal further online-offline integration in the Philippines.
Hong Kong-listed International Entertainment Corp, parent of LaVie Resort & Casino in Manila, expects a loss of HK$500 million (US$63.8 million) for the year ended 30 June 2026. This widens from the HK$282.1 million (US$36.0 million) loss reported a year earlier.
The deficit is non-cash in nature. It includes a HK$425 million (US$54.2 million) charge from the fair value change of financial liabilities tied to the HK$1.6 million (US$205 million) in convertible notes issued to DigiPlus Interactive Corp earlier this year, as reported by Inside Asian Gaming.
Non-Cash Charge and Operating Expenses
The accounting value of the debt liability rose by the stated amount. IEC noted that absent this fair value adjustment it would report a narrowed loss when final results are released later this month.
The company also recorded higher selling and marketing expenses. These stemmed from increased spending on marketing campaigns and promotional activities to improve the competitiveness of LaVie.
DigiPlus Stake and Cooperation Agreement
DigiPlus has not yet converted the notes. Conversion would deliver a controlling 53.89% stake in IEC and LaVie.
The companies entered a cooperation agreement to launch a new online gaming business linked to the Manila casino. DigiPlus has stated that assuming an interest in a land-based casino-resort would “strengthen DigiPlus’ omnipresent entertainment ecosystem by adding a strategic offline platform that seamlessly connects with its digital network, enhancing brand activation, player engagement, and customer experience across both physical and online touchpoints.”
Reporting: Inside Asian Gaming
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
The headline loss is accounting noise; what matters is DigiPlus moving toward 54% control and online-offline integration in Manila.
We've watched DigiPlus build the dominant digital gaming franchise in the Philippines for years. Now they're bridging into bricks-and-mortar at LaVie with an online-offline play that could set the template for integrated ecosystems across Asia. The accounting charge is irrelevant — the strategic move is everything.
- HK$500M loss inflated by HK$425M non-cash fair value charge on DigiPlus convertible notes
- Operational loss actually narrowed despite higher marketing spend at LaVie casino
- DigiPlus conversion would deliver 53.89% control and new online gaming tie-in at Manila property
SCCG angle: SCCG has relationships across the Philippines and Asian markets and deep connections with both land-based operators exploring digital adjacencies and online platforms looking at retail. If you're navigating cross-border partnerships or evaluating omnichannel models in regulated Asian markets, we connect the dots between digital and physical players who actually execute.
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