Genting Singapore Ltd, operator of the Resorts World Sentosa casino resort (pictured) in Singapore, announced on Tuesday a raft of pay cuts for staff at managerial level or above, due to the “massive disruption to the travel and tourism industries” cause by the Covid-19 pandemic.
It also called for more junior staff to take either “no-pay leave and/or annual leave” during the current downturn in business. The firm also issued a profit warning for the first half this year.
According to the filing to the Singapore Exchange, all facilities at the resort remain open, although with “stringent health and precautionary measures,” to ensure the well-being of its employees and visitors to the property.
Genting Singapore said the coronavirus issue had led to its Singapore resort experiencing “a significant decrease in visitor attendance and correspondingly revenue, across all its facilities, including … attractions, hotels, restaurants, MICE [meetings, incentives, conferences and exhibitions] facilities and the casino.”
The firm didn’t go into specifics in the filing regarding the monetary value of lost business. But it outlined the following pay-cut moves: a 15-percent reduction in non-executive directors’ fees for the first quarter 2020; an 18-percent reduction in the base salary for executive directors; and a reduction ranging from “9-percent to 18-percent” for all managerial staff.
The firm’s announcement also did not clarify over what period of time the pay cuts in base salary of executive directors and pay of managers would apply.
Genting Singapore did add it would seek to “streamline workflow” and “strengthen” its productivity.
The group further noted that – while the financial impact for 2020 business of Covid-19 was still unclear – it was issuing guidance that financial results would be “significantly and adversely impacted for the first quarter ending 31 March 2020 and the half year ending 30 June 2020, as compared to the corresponding periods in the previous year”.
It was announced in April last year that Genting Singapore had made a commitment to the Singapore government to spend SGD4.5 billion (US$3.15 billion) to expand its facilities at Resorts World Sentosa in return for its casino licence – issued under the city’s casino duopoly – being extended until 2030.
Moody’s Investors Service said in a Monday research note that it had placed its issuer rating on Genting Singapore under review for a downgrade, amid concerns about the course of the Covid-19 pandemic.
The ratings agency said it expected Genting Singapore’s earnings this year to decline by about 35 percent compared to 2019, but noted that the company’s credit metrics would remain strong. Moody’s said also that Genting Singapore should be able to maintain “excellent liquidity”, “helped by its sizeable cash position” of SGD3.9 billion, compared to a gross balance sheet debt of SGD261 million, as at December 31, 2019.
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Aggregate casino revenue in June reported by South Korean casino operator Paradise Co