Feb 26, 2021 Newsdesk Latest News, Rest of Asia, Top of the deck
Casino operator Genting Malaysia Bhd reported adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) of MYR170.4 million (US$42.2 million) for fourth-quarter 2020, down 45.2 percent from the previous quarter. That was on revenue that fell 26.5 percent sequentially, to MYR1.04 billion, said the company in a Thursday filing.
Brokerage Nomura said in a Thursday note that the casino firm’s adjusted EBITDA during the quarter was down “mainly due to decline in EBITDA from Malaysia” operations because of restrictions there to contain the COVID-19 pandemic, “which was partially offset by higher EBITDA from the U.S. operations.”
“Overall, movement curbs in Malaysia … along with closures in overseas markets will weigh on [Genting Malaysia's] performance till first-half 2021 at least,” suggested the institution.
In year-on-year terms, the group’s EBITDA was down 69.1 percent in the reporting period, while its revenue declined by 57.3 percent.
The company reported a net loss of just above MYR240.8 million for the three months to December 31, an improvement on the MYR704.6-million loss in preceding quarter. Genting Malaysia posted a MYR299.7-million profit for fourth-quarter 2019.
The firm, which runs Malaysia’s only casino resort, Resorts World Genting (pictured), also operates casinos in the United Kingdom and Egypt, and in the United States and the Bahamas.
Operations at Genting Malaysia’s main money maker, Resorts World Genting, were suspended from March 18 until June 19, as part of national efforts to contain the Covid-19 pandemic. Subsequently the complex has been running at reduced capacity as a safety precaution.
Despite the challenging trading conditions, Genting Malaysia announced on Thursday a special, single-tier dividend of MYR0.085 per ordinary share, to be paid on April 6.
The group said that its leisure and hospitality business in Malaysia recorded a 59.8-percent year-on-year decline in revenue in the final three months of 2020, to MYR644.7 million. Such quarterly revenue was down 45.4 percent sequentially, it added.
The group said in commentary that the decrease in revenue in its Malaysian operations “was primarily due to travel restrictions imposed in line with the implementation” of country-wide restrictions on October 14.
It added: “The impact to the group’s earnings was mitigated by higher hold percentage in the mid- to premium-players segment, coupled with lower operating expenses as well as a reduction in payroll and related costs due to lower headcount.”
Resorts World Genting continues to operate with “reduced capacity” amid “strict health and safety protocols” imposed by the Malaysian authorities, stated Genting Malaysia.
The casino resort, located in an upland area outside Malaysia’s capital, had to temporarily close again earlier this year. The complex only reopened on February 16, after being closed for more than three weeks as a Covid-19 countermeasure.
For full-year 2020, Genting Malaysia reported a net loss of just above MYR2.26 billion, compared to a profit of MYR1.40 billion a year earlier. That was on revenue that declined 56.5 percent year-on-year, to MYR4.53 billion.
The group was still able to achieve positive adjusted EBITDA of MYR350.3 million in the 12 months of 2020, “anchored by the Malaysian operations.” Such EBITDA was down 86.7 percent from 2019.
The group also said it had reduced its costs during full-year 2020. This was a result of a “recalibration of the group’s operating structure” in response to disruptions to the group’s operations amid the pandemic.
In Thursday’s filing, Genting Malaysia confirmed that the long-awaited outdoor theme park at Resorts World Genting, called “Genting SkyWorlds”, “is was targeted to open by the middle of 2021.”
The firm also said that the group’s land-based casinos in the United Kingdom “remain temporarily closed,” and that a new 400-room hotel at Resorts World New York hotel “is set to open in phases from the middle of 2021.”
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