Genting Singapore’s net profits crash 83% to $10.8m in Q1

On back of weak regional economic outlook.

Lady Luck may not be on Genting Singapore’s (GS) sides, as the company’s net profits for the first quarter of 2016 tumbled 83% YoY to $10.8m.

According to a report by OCBC, the crash is on back of a 5% revenue slip to $608m, which in turn a result of the subdued regional economic outlook and slowdown in China’s growth momentum.

Meanwhile, GS management asserts that Resorts World Sentosa (RWS) saw an 11% QoQ growth in adjusted earnings before interest, tax, dividends and amortisation (EBITDA). This is thanks to growth in the regional gaming volume for VIP and premium mass, as well as raised VIP rolling win percentage.

GS’ non-gaming business also performed well, with 1.6m visitorship to its attractions, while Universal Studios Singapore posted its best Q1 performance since opening, both in terms of revenue and attendance.

The company asserts that going forward, it will retain its focus on the premium mass segment. GS has already seen encouraging progress in this segment thanks to the implementation of new marketing schemes to grow the foreign premium mass market.

GS also anticipates the mass gaming market to perform well after the strong electronics gaming machines performance in 1Q16.

As for its VIP business, GS will continue to exercise caution. Besides being prudent in granting credit, it has also slashed the credit period from 90 to 30 days.

Separately, GS updates that the construction of the IR in Jeju, South Korea is progressing well. The residential plot’s construction is now at an advanced stage, and it has commenced sale of some units in April 2016, with targets to sell just below $1b. The whole resort is posed to see a soft opening by 4Q17.