Moody’s upgrades Genting Singapore outlook to “stable”
Genting Singapore has received an A3 issuer rating.
Singapore.- Analysts at Moody’s Investors Service have upgraded their credit opinion on Genting Singapore’s outlook from “negative” to “stable”. The company now has an issuer rating of A3, which is considered low credit risk.
Moody’s analyst Yu Sheng Tay said: “The change in outlook to stable and [the] ratings affirmation reflect our expectation that credit metrics across the Genting group of companies will improve over the next 12 to 18 months, supported by continued recovery in operating performance.”
Moody’s expects the company’s earnings to improve as the Singapore casino market rebounds from the pandemic, with earnings before interest, taxation, depreciation and amortisation (EBITDA) expected to increase to about SGD990m in 2023. However, Moody’s predicts that Genting Singapore’s earnings are unlikely to return to 2019 levels until 2024 or 2025.
Despite cost pressures from rising utilities and labour costs, and an increase in casino tax rates in Singapore, Genting Singapore’s credit metrics will remain strong, supported by its net cash position of SGD3.1bn as of 30 June 2022.
According to Moody’s, the casino operator is dependent on the recovery of Singapore’s tourism sector. However, The Singapore Tourism Board (STB) has reported it expects international visitor arrivals to reach 12 to 14 million in 2023, bringing in SGD18.00bn (US$13.62bn) to SGD21.00bn in tourism receipts – around two-thirds to three-quarters of the levels in 2019.
Genting Singapore is investing SGD4.50bn (US$3.39bn) in the expansion of Resorts World Sentosa as part of its casino licence extension until 2030.
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