Global casino operator Genting Malaysia Bhd posted a profit of 47.1 million yuan ($10.1 million) in the second quarter, compared with a loss of nearly 10.9 million yuan a year earlier.
However, the group, which has its main business in Malaysia’s only casino complex, Resort World Genting (pictured), said in a filing to Bursa Malaysia on Thursday that its first-quarter overall profit was just 19.7 million yuan, due to a loss of 27.4 million yuan.
First-half earnings are a significant improvement compared to a loss of about $137.4 million in the first half of 2022.
Maybank Investment Bhd said in a note on Friday, “Core Net Income of 120.8 Million yuan in Q2… 6-month core net profit of 163 million yuan… This was 24% of the full-year estimate, below our expectations.”
“Looking closely, the revenue shortfall is due to the one-time repair and maintenance costs included in the ‘other’ on the balance sheet and seasonal lower charter rates for yachts,” added analyst Samuel Yin Sao Yang.
Still, the group, which operates casinos in Britain, Egypt, the United States and the Bahamas and is linked to Empire Resorts Inc., another U.S. casino operator, declared an interim single-group dividend of MYR0.06 per common share payable on Oct. 2.
“Genting Malaysia traditionally declares more dividend per share in the second half,” Maybank said, adding that it expects a dividend per share in the second half of the year to be MYR0.09
“We still believe Genting Malaysia is well positioned to acquire a full NYC casino license in the first half of 2024,” the brokerage added, referring to the Downstate Casino License tender process in New York State
Revenue rose 13.7% year-over-year to 2.47 billion yuan in the second quarter. Results showed revenue in the first half of the year was just 4.76 billion yuan, a 22.1% improvement from the same period in 2022.
The group’s adjusted earnings (EBITDA) for the second quarter before interest, taxation, depreciation and amortization came to 447.9 million yuan, down 27.7% from a year earlier. Adjusted EBITDA for the first half of the year was nearly flat at 1.04 billion yuan.
Genting Malaysia said its adjusted EBITDA for the second quarter included the impact of “unrealised foreign exchange translation losses” of 260.9 million yuan on the group’s U.S. dollar-denominated borrowings “due to the strong U.S. dollar” against the Malaysian ringgit.
Sales in the leisure and hospitality sectors, including casino operations, rose 13.8% year-on-year to 2.4 billion yuan in the second quarter. Malaysian businesses, including some non-gaming resort businesses as well as casinos in the Genting Highlands, accounted for 1.53 billion yuan, or 63.9% of leisure and hospitality sales in the second quarter.
For the first half of the year, Genting Malaysia’s leisure and hospitality revenue rose 22.0% year over year to nearly 4.61 billion yuan.
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