Genting’s net profit fell 66.7% in Q3

PETALING JAYA: Genting Bhd’s net profit for the third quarter ended Sept 30, 2017 fell 66.70% to RM191.13 million from RM574.00 million a year ago due to lower earnings from Resorts World Genting (RWG) as well as plantation and oil and gas divisions.

In a filing with Bursa , the group said the lower profit was also due to a reversal of previously recognised impairment losses in the previous year’s corresponding quarter, compared with impairment losses in the current quarter mainly in respect of the UK casino licences.

RWG’s adjusted ebitda fell due to the lower revenue, higher costs relating to the premium players business and higher operating costs incurred for the new facilities under the Genting Integrated Tourism Plan.

The plantation division’s adjusted ebitda fell due to Malaysian plantation business as a result of lower FFB production and higher unrealised profit from intra-segment sales while the oil and gas division’s adjusted ebitda fell marginally.

Revenue for the quarter rose 7.60% to RM5.04 billion from RM4.68 billion a year ago due to higher revenue from all divisions except for RWG, whose revenue fell due to lower hold percentage from the mid to premium segments, although overall grew.

The opening of new attractions at SkyPlaza in March 2017 contributed significantly to the rise in revenue from the mass market.

During the quarter, revenue from Resorts World Sentosa (RWS) rose due to stronger VIP and premium mass business volume. Revenue from the non-gaming segment also increase, with the attractions business performing well and business registering average occupancy rate of 93%.

The casino business in the UK reported higher revenue and adjusted ebitda due to overall higher hold percentage, higher volume of business from its premium gaming segment and stronger Sterling Pound. However, these were partially offset by the higher level of bad debt.

The leisure and hospitality business in the US and Bahamas reported higher revenue and adjusted ebitda due to an improved commission structure with the New York state authority on Resorts World Casino New York City’s gaming operations and the lower adjusted loss before interest, tax, depreciation and amortisation (LBITDA) from Resorts World Bimini due to lower operating costs.

In the plantation division, revenue rose due to higher fresh fruit bunch (FFB) production from Indonesia and higher sales of refined palm products while the oil and gas division’s higher revenue was due to higher average oil prices.

For the power division, revenue and adjusted ebitda was mainly from the sale of electricity by the Indonesian Banten coal-fired power plant. The higher adjusted LBITDA from investments and others division was due to net foreign exchange losses on net foreign currency denominated financial assets.

For the nine months ended Sept 30, 2017, net profit rose 25.76% to RM1.25 billion from RM990.10 million a year ago while revenue rose 8.43% to RM14.76 billion from RM13.61 billion a year ago.

Moving forward, the group expects to roll out new attractions in RWG and RWS while its performance in the UK and the US remain stable. For the plantation division, it is optimistic that its full-year FFB production will scale to a new high, exceeding the 1.73 million metric tonnes achieved last year.

Genting’s fell 1.51% or 14 sen to close at RM9.15 with a total of 634,600 shares traded.

Source: The Sun Daily

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