This article first appeared in The Edge Financial Daily on November 24, 2017

KUALA LUMPUR: Genting Bhd’s earnings for the third financial quarter ended Sep 30, 2017 (3QFY17) went down 66.7%, dragged by impairment losses of RM252.8 million plus a sharp rise on expenses and finance costs.

The group posted a net profit of RM191.13 million compared with RM574 million a year ago. Net profit in the previous corresponding quarter was boosted by the reversal of previously recognised impairment losses of RM195.2 million.

Its other expenses soared to RM925.6 million in 3QFY17 from RM556 million a year ago, while its finance costs increased to RM236.79 million from RM164.09 million previously, according to its filing with Bursa Malaysia.

Genting said the hefty impairment losses of RM252.8 million were mainly in respect of the UK casino licences compared with RM16.1 million in the previous corresponding quarter.

Genting’s quarterly revenue grew 7.6% to RM5.04 billion in 3QFY17 from RM4.68 billion in 3QFY16, mainly contributed by an increase in revenue from Resorts World Sentosa which was supported by a stronger VIP and premium mass business volume, as well as an increase in revenue from its hospitality businesses in the US and Bahamas.

For the nine-month period ended Sep 30, 2017 (9MFY17), the group’s accumulative net profit went up by 25.8% to RM1.24 billion from RM990 million a year ago.

The increase was due mainly to higher earnings before interest, taxes, depreciation and amortisation (Ebitda), gain of RM302.2 million from the disposal of Genting Singapore plc’s 50% equity interest in Landing Jeju Development Co Ltd and divestment of available-for-sale financial assets.

Impairment losses for 9MFY17 included impairment losses on the UK casino licences and the carrying value of the group’s investment in Lanco Kondapalli Power Ltd, an associated company, due to the adverse performance of its power plant in India for a prolonged period.

On its prospects, Genting said for Malaysia the group remains focused on the development of the Genting Integrated Tourism Plan at Resorts World Genting.

For the latter, Genting said that its repositioning as a lifestyle brand will broaden its appeal to attract premium customers.

Year to date, Genting share price had gained 15% to RM9.15 yesterday.