Standard & Poor’s (S&P’s) Global Ratings has assigned a ‘BBB-’ long-term issuer credit rating with ‘negative’ outlook for Genting New York LLC, operator of Resorts World Casino New York City (pictured) in the United States.
The financial institution has in addition on Monday issued a ‘BBB-’ rating to the company’s senior unsecured notes, S&P said in an announcement.
It noted that Genting New York was a “single-asset operator” but that its venue near John F. Kennedy International Airport was due to “accommodate an expanded gaming floor and 400 rooms”, and already had a “a dominant market share of slot machines” in New York City.
The ratings house also thought the New York City operation would recover more quickly than the Genting group casinos in respectively Malaysia and Singapore, because the New York City market was focused on locals rather than overseas tourists.
Genting New York’s immediate controller is Genting Malaysia Bhd, and its ultimate controller, the group entity, Genting Bhd.
S&P said the ‘negative’ outlook on Genting New York, “reflects that on its ultimate parent”.
“This is based on our view that Genting [Bhd] has limited rating headroom due to its elevated capital expenditure and a delayed recovery from the Covid-19 pandemic,” wrote analysts Shawn Park, Simon Wong and Christina Lim.
S&P rates Genting Bhd one notch higher, at ‘BBB’ with a ‘negative’ outlook.
The ratings house noted that while Resorts World Casino New York City had “completely closed for six months from March 2020 due to the pandemic,” with the resumption of operations starting from September, Genting New York’s business was “already nearly back to pre- Covid-19 levels”.
The analysts said: “We expect Genting New York’s operations to recover more strongly than for Genting’s other gaming locations, such as Singapore and Malaysia.”
Resorts World Genting, in Malaysia, is currently shut until February 4, due to an uptick on Covid-19 cases in that country. Resorts World Sentosa, in Singapore, has been running at reduced capacity at non-gaming attractions as well as gaming operations, as Covid-19 countermeasures.
The institution said it thought it “unlikely” that Genting New York would be sold, “due to its close association with the group’s brand and reputation, as well as its operations in the same line of business”.
The financial institution observed that it believed Genting Bhd would support Genting New York, “even under a stressed environment”.
“Through Genting Malaysia, the group provided more than US$500 million in support to the company, mostly for the construction of Resorts World New York City from 2010 to 2011,” stated S&P.
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