Genting Singapore’s recovery slower than expected, analysts say

Brokerage Nomura has reduced its previous EBITDA forecasts for Genting Singapore due to lower than expected revenue in Q1.

Singapore.- Genting Singapore’ recovery is taking more time than expected due to countermeasures related to the Covid-19 pandemic.

Brokerage Nomura has reduced its previous EBITDA forecast by 15 per cent for 2021 and 2022. It now expects Genting Singapore to record an average quarterly EBITDA of SGD133m for 2021, down 37 per cent from the previous quarter.

According to analysts, a new rise in Covid-19 cases in Singapore and Malaysia led to the revised forecast.

Singapore has recently announced that the planned travel bubble with Hong Kong has been put back until at least June.

In April, the Ministry of Transport announced that an air travel bubble with Hong Kong was to begin on May 26. However, last week Singapore registered new cases of Covid-19, leading to the plans to be put back.

In Malaysia, authorities have ordered the temporary closure of the Resorts World Genting’s (RWG) casino until further notice as part of Covid-19 countermeasures.

Movement Control Order 3.0 announced by the government orders people to work from home and limit the operating hours.

Genting Singapore reported a decrease in revenue of 32 per cent year-over-year and 12 per cent compared to the previous quarter during Q1.

Adjusted EBITDA came in at SGD118.1m, down 19 per cent from the SGD145m in the first quarter of 2020. 

Casino sales were up 2 per cent when compared to the previous quarter, from SGD213.5m to SGD216.9m but down 19 per cent from 2020 levels.

Despite the slight increase in casino sales thanks to domestic business after properties reopened, the casino operator is highly dependant on international tourism.