GGRAsia – Nomura dips GEN Singapore 2021 EBITDA on capacity limits

Nomura dips GEN Singapore 2021 EBITDA on capacity limits

Nov 10, 2021 Newsdesk Latest News, Singapore, Top of the deck

Genting Singapore Ltd’s adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) for full-year 2021 are estimated by banking group Nomura as likely to come in at SGD490 million (US$363.6 million), which the institution said in a Tuesday note, was a decrease on its previous forecast. The memo was issued the same day the casino group reported its third-quarter results.

Genting Singapore promotes the Resorts World Sentosa casino complex (pictured) in Singapore.

The change in estimate was “factoring in the continuing capacity restrictions in second half 2021” regarding Singapore’s countermeasures on Covid-19.

Analysts Tushar Mohata and Alpa Aggarwal stated: “While earnings in the near-term are unlikely to surprise on the upside, we reiterate our positive stance on Genting Singapore to play the trend of gradual border reopening for Singapore to overseas visitors.”

But they added that the “return of Chinese nationals still seems to be some time away,” with China “still pursuing a zero-Covid strategy”.

That was likely to “continue to impact” Genting Singapore’s revenues in financial year 2022, “given China was the most important overseas market before the pandemic,” added the Nomura analysts.

Genting Singapore recorded third-quarter adjusted EBITDA of SGD102.5 million, down 30.7 percent from the preceding quarter. In year-on-year terms, it was a decline of 31.2 percent, according to Tuesday’s press release.

Under the Vaccinated Travel Lane programme, which began on September 8, Singapore has admitted tourists from a number of countries, including Canada, the United States, France, Italy, the Netherlands, Spain and the United Kingdom.

On Monday, Singapore and Malaysia announced that from November 29 the two sides would permit air travel for their fully-vaccinated citizens, between Singapore Changi Airport and the Malaysian capital Kuala Lumpur. Under the scheme, fully-jabbed travellers will be subjected to Covid-19 tests in lieu of serving quarantine.