Resorts World Las Vegas (pictured), the Nevada, United States, casino complex due to open this year, could reach fully ramped-up earnings before interest, taxation, depreciation and amortisation (EBITDA) by the end of 2024, said Fitch Ratings Inc, in a Sunday memo.
The institution added that Resorts World Las Vegas LLC was “on track” to open its resort in the Nevada gaming hub, “in around June 2021”.
But Fitch added: “The pandemic is likely to delay operational ramp-up, as we expect inbound flights and demand for large-scale conventions in Las Vegas to remain soft in 2021.”
The ratings house noted: “We estimate aggregate revenue for Las Vegas’s strip operators will only recover to 90 percent of 2019, by end-2023, and expect Resorts World Las Vegas to reach fully ramped-up EBITDA of US$350 million by end-2024.”
Fitch said it had assigned a ‘BBB’ rating to proposed senior unsecured notes to be issued by Resorts World Las Vegas LLC and RWLV Capital Inc as a co-issuer.
“The company plans to use the proceeds to refinance existing secured debt,” noted Fitch.
It has rated the proposed notes at ‘BBB’ – investment grade – with a ‘negative’ outlook, the same as Resorts World Las Vegas’ issuer default rating “because they will constitute its direct, unsubordinated and unsecured obligations,” said Fitch in a Sunday memo.
The ratings house said it considered Malaysia’s Genting Bhd to be “the stronger parent,” and Resorts World Las Vegas the “weaker subsidiary”.
“There are strong strategic and operating ties between Genting and Resorts World Las Vegas [LLC],” meaning that when the Las Vegas property is opened, “it will be Genting’s third-largest integrated resort after those in Malaysia and Singapore,” said Fitch.
The ‘negative’ outlook on the proposed Resorts World Las Vegas notes, which was “aligned “with that on the Genting parent, “captures the risk of a slower gaming recovery from the coronavirus pandemic impact than we forecast, such that Genting’s leverage is elevated for an extended period,” stated Fitch.
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