Genting Malaysia earnings to fall 10% in 2021, analysts say

Genting Malaysia continues to feel the impact of the Covid-19 pandemic. but earnings should improve during the second quarter.

Malaysia.- According to Nomura analysts Tushar Mohata and Alpa Aggarwal, Genting Malaysia will see earnings fall by 10 per cent in 2021.

They predict the casino operator will make a loss of around MYR184m (US$45m) because of restrictions to contain the Covid-19 pandemic.

According to the analysts, revenue will come in at around MYR6.32bn (US$1.54 bn), down from an earlier estimate of MYR7.05bn (US$1.71bn).

Although earnings from Resorts World Genting (RWG) and Resorts World Awana (RWA) will be impacted in the first quarter by Covid-19 countermeasures, Nomura said earnings should improve in Q2 thanks to the roll-out of vaccinations.

Mohata and Aggarwal stated: “We believe that 1Q21 earnings from Malaysian operations will be impacted due to ~1 month closure of the resort due to the movement control order. However, given the reopening since then, and progressive ramp-up of vaccination, revenue/EBITDA momentum should improve thereafter, in our view.

“There remains a possibility that any future wave of COVID-19 infections might impact visitation again later in 2021, but the risks of this happening will dissipate as vaccination ramps up in 2H21.”

Genting Malaysia cuts salaries

The casino operator is cutting salaries to reduce costs as the impact of the Covid-19 pandemic continues. With multiple lockdowns over the last year, revenue declined 57.3 per cent in 2020.