Genting Malaysia posts Q2 profit

Genting Malaysia

Analysts were pleasantly surprised by Genting Malaysia’s solid 19Q2 earnings but said the recent acquisition of Empire Resorts will weigh on long-term earnings. 

The casino operator posted a net profit of RM416.5 million in the second quarter of 2019, up 5.3 percent year-on-year. Quarterly revenue also grew slightly to RM2.7 billion.

Genting Malaysia’s domestic operations achieved a 10 percent growth in revenue, however, Resorts World Genting reported an overall decline in the volume of business in the gaming segment, due to lower incentives offered to customers as part of cost-cutting initiatives. 

Analysts from Maybank said that the company has been successful in managing the impact of the 10 ppt casino duty rate hike, and its corporate tax rate bill. 

However, the analysts were concerned about the casino company’s plans to acquire Empire Resorts. 

“That said, its recent acquisition of a 49 percent shareholding in Empire Resorts will weigh on long term earnings,” said the analysts. 

Earlier this month, Genting Malaysia issued a statement defending its proposed acquisition of Empire Resorts saying the combination is in the best interests of both companies’ shareholders.

The company was replying to a letter from Bursa Malaysia asking for clarification of reports the U.S. operator is close to filing for Chapter 11 bankruptcy protection.

“We may revisit our call if Empire Resorts is successfully turn around financially,” the analysts added. 

Looking ahead, Genting said it remains cautious of the opportunities and growth potential of the leisure and hospitality industry. 

“In line with uncertain economic sentiments, the regional gaming industry is anticipated to remain challenging, particularly in the premium players segment, as evidenced by the recent performances of certain gaming operators in Singapore and Macau.

SHARE
Previous articleNSW regulators updates rules on gaming machines, casinos
Next articleKambi deepens sportsbook ties with NagaWorld 

Related Articles

Resorts World Genting

Local VIPs buoy Genting’s Malaysia operations

Behind the sea of red in Genting Malaysia’s Q3 results, analysts found reason for cheer in the performance of its domestic operations, which generated a positive EBITDA of RM541 million ($133 million) in the quarter.

Genting Malaysia losses at US$182 million in Q3

Genting Malaysia recorded total revenues of over RM1.4 billion (US$354 million) in the third quarter of 2020, representing a 46 percent decline year-on-year. The group registered a net loss of RM726 million (US$182 million).
Resorts World Genting

Outlook brightens from H2, Fitch says

Jurisdictions benefiting from local support will continue to outperform in the first half of next year, with destination markets such as Singapore, Macau and Las Vegas, likely to begin a faster pace of recovery in the second half once vaccines become more widely available, Fitch Ratings said.

Genting Malaysia confirms worker positive for Covid-19

Genting Malaysia's Resorts World Genting said one of its security workers has tested positive for Covid-19 during routine health screening protocols. The company said the worker is receiving treatment at a government hospital and did not interact with guests.

No new casino taxes seen in Malaysia

The Malaysian government is unlikely to further hike casino taxes, as they are already among the highest in the region and the country's only operator, Genting Malaysia, is suffering from the impact of Covid-19, RHB says.
Resorts World Sentosa (file)

Slow Singapore recovery leads to “negative” Genting outlook: S&P

Ratings agency Standard & Poor’s has reaffirmed Genting Malaysia’s BBB rating, but says the outlook is “negative” due to a slower-than-expected recovery in Singapore.

Genting Malaysia seeks to boost domestic demand

Genting Malaysia said it’s seeking to boost domestic demand and visitation at its flagship property in the country, but the overall outlook for the group remains “uncertain.”
“Worst may be over” for Resorts World Genting: RHB

“Worst may be over” for Resorts World Genting: RHB

The “worst” of the crisis may be over for Resorts World Genting, with a significant improvement in visitation since it reopened three months ago, RHB Research said in a note.

Genting Malaysia injects more cash into US-based Empire Resorts

Genting Malaysia is injecting US$150 million in cash into its loss-making US unit Empire Resorts, its gaming facilities temporarily closed in March as a result of the Covid-19 pandemic. This follows a similar cash injection of US$40 million into the unit in March. Empire Resorts owns and operates Resorts World Catskills, a casino resort which […]
New York casinos face strict reopening criteria

New York casinos face strict reopening criteria

Casinos in New York State, including Genting Group’s Resorts World Catskills, will be permitted to open from next Wednesday, though will face strict reopening restrictions.