GGRAsia – Genting HK 30-pct profit dip beats forecast

Genting HK 30-pct profit dip beats forecast

Mar 20, 2015 Newsdesk Latest News, Rest of Asia, Top of the deck

Genting Hong Kong Ltd, an operator of casino cruise ships under the Star Cruises brand and a joint venture casino developer and operator in the Philippines, said profit attributable to owners of the company fell 30.3 percent year-on-year in 2014.

Such profit slipped to US$384.5 million, from US$552.4 million in 2013.

The firm had issued a warning to the Hong Kong Stock Exchange in mid-February that 2104 profits might fall by as much as 37 percent. But the firm said at the time that the numbers contained in its warning did not include the contributions from associate company Travellers International Hotel Group Inc.

The latter is a Manila-listed venture with Philippines conglomerate Alliance Global Group Inc for casino development and operations in the Philippines. Genting HK has a 45-percent interest in Travellers International. The venture operates the Resorts World Manila casino resort, and is building a second in the Philippines capital, the US$1.1 billion Bayshore City Resorts World, due to open by the end of 2018.

Genting HK reported on Friday that its share of the profits made by Travellers International had increased 67.9 percent year-on-year in 2014, to US$52.4 million, from US$31.2 million a year earlier. Genting HK said the improvement was “primarily due to the decrease in Travellers’ operating expenses as a result of cost management initiatives”.

Genting HK added its 2014 trading position had also benefitted from gains of US$152.6 million and US$124.0 million from, respectively, a disposal of some ordinary shares in associate company Norwegian Cruise Line Holdings Ltd (NCLH) in March 2014, and a partial disposal of a particular stake in NCLH in November after the latter issued some new shares in connection with the latter’s acquisition of Prestige Cruises International Inc.

Group wide, Genting HK reported revenue of US$570.8 million for 2014, a 2.9 percent growth from that of 2013.

The group’s gaming revenue increased by 10.5 percent to US$348.9 million “mainly due to a higher blended hold rate despite reduction in gaming volume,” it stated.

The group’s earnings before interest, taxation, depreciation and amortisation (EBITDA) for 2014 rose 4.3 percent to US$48.9 million, compared to US$46.9 million for 2013.

Cruise passenger ticket revenue decreased 15.6 percent to US$134.8 million “mainly due to the dry dock [sic] of mv SuperStar Virgo as well as changes in deployment and itineraries of mv SuperStar Gemini,” said the firm, referring to two of its casino cruise vessels. Star Cruises operates out of Hong Kong and Singapore, with casino operations taking place in international waters.

Friday’s filing said that Star Cruises has two new cruise ships on order with a German shipyard, with delivery scheduled in the fourth quarter of 2016 and 2017, respectively.

Genting HK added it “looks forward” to completing its recently announced acquisition of Crystal Cruises Inc, which it said would add “two award-winning luxury ships – mv Crystal Serenity and mv Crystal Symphony – to our growing fleet, and expand the company’s presence in the cruise industry”.