Genting Malaysia Bhd Still Running At A Loss In Q3

Genting Malaysia Bhd has increased its margins, but is still running at a substantial loss and is not sure when it will really come to recovery. For the third quarter, the casino operator posted a MYR704.6 million ($173.2 million) loss, a 22 percent improvement from Q2.

In a November 26 filing with Bursa Malaysia, the operator of Resorts World Genting announced his financial performance. Although the company improved from its previous loss of MYR900.4 million ($221.2 million), they acknowledged that times continued to be tough, in part because the pandemic continues to affect business volumes.

Between March 18 and June 19, operations at Genting Malaysia were entirely suspended due to wider efforts in Malaysia to contain Covid-19. Throughout Q3, although the casino was open, reduced capacity cut into potential revenues.

However, earnings before interest, tax, depreciation and amortisation (EBITDA) turned out to be positive, showing MYR310.7 million ($76.3 million). Although this is still down 55 percent year-over-year from the Q2 EBITDA of negative MYR486.2 million ($119.4 million), it allowed Genting Malaysia to pay out an interim, single-tier dividend of MYR0.06 per ordinary share, totalling MYR339.2 million ($83.3 million).

With the findings, a Nomura analyst was pleased. “What really struck us [positively] was the revenue/margins generated by the Malaysian resort, with revenue at 66 percent and EBITDA at 79 percent of year-ago levels, and EBITDA margins of 36 percent in Malaysia,” they noted in a memo.

Year-over-year sales declines were largely due to Malaysia’s reduced operations, falling 34 percent to MYR614.9 million ($151.06 million). In the U.S. and Bahamas, however, reduced sales have hurt, falling 80 percent to MYR285.9 million ($70.24 million).

Genting is advising shareholders that the future is still very unpredictable, even though Nomura may find promising indicators for these outcomes. In their outlook, they wrote that a gradual recovery is required, but eventually: “Given the dynamic operating environments both locally and abroad, uncertainties surrounding the full impact of the pandemic on the Group’s operations and financial performance remain. The Board wishes to caution that the Group expects its financial results for the financial year ending 31 December 2020 to be adversely impacted.”

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About Joe Kizlauskas

Joe is a seasoned iGaming copywriter and speaker who has been in the business since 2015. He's written more words on all elements of iGaming than he likes to remember, and he's contributed material to a number of well-known brands. Joe may be seen playing 5 a side, at the gym or playing games on his Playstation when he is not writing.