This article first appeared in The Edge Financial Daily on August 30, 2019

KUALA LUMPUR: Diversified group Genting Bhd’s net profit grew 56% to RM599.68 million in the second quarter ended June 30, 2019 (2QFY19) from RM383.52 million in the corresponding quarter last year, boosted by higher earnings in its leisure and hospitality division.

Quarterly revenue was up 12.9% to RM5.45 billion from RM4.82 billion. The group declared an interim dividend of 6.5 sen per share.

Kien Huat Realty Sdn Bhd, which is controlled by its chairman and chief executive Tan Sri Lim Kok Thay, will receive dividend of about RM106 million from his 42.35% equity stake in Genting. Prior to that, Lim will also be getting RM538 million proceeds from selling a 35% stake in the US-based casino operator Empire Resorts Ltd.

Genting said in the result announcement that its quarterly earnings were lifted mostly by higher leisure and hospitality income from Singapore, the UK and Egypt, as well as the US and Bahamas, together with stronger contribution from its power business.

Singapore’s profit before tax (PBT) rose 16% to RM929.2 million, while the UK and Egypt’s PBT advanced 52% to RM45.1 million, and the US and Bahamas’ PBT was up 32% to RM102.6 million.

Its power business PBT rose 18% to RM135.2 million. “Revenue and Ebitda (earnings before interest, taxes, depreciation and amortisation) from the power division increased compared with 2Q18 due mainly to higher generation from the Indonesian Banten coal-fired power plant,” said Genting.

The gains were mitigated by a slight 2% PBT drop to RM675.1 million in its Malaysian leisure and hospitality segment as overall gaming business volume fell on fewer incentives offered to players, despite higher revenue that was boosted by the opening of new attractions under its Genting Integrated Tourism Plan.

It also saw a 24% drop in plantation PBT to RM75.7 million, and a 15% drop in oil and gas PBT to RM48.3 million, while its investments and others segment fell to a pre-tax loss of RM36.6 million versus a PBT of RM15.5 million previously.

For the cumulative six months of FY19, the group’s net profit grew 18% to RM1.16 billion from RM986.22 million a year ago, while revenue rose 9.38% to RM11.02 billion from RM10.07 billion.

On prospects, the group said Genting Malaysia Bhd (GenM) is continuing work on the development of its outdoor theme park following the resolution of the legal dispute over the project.

“Details on the opening date of the outdoor theme park will be made available in due course,” said Genting, adding that GenM will continue to focus its efforts on rationalising its operating cost structure and improving overall operational efficiencies at Resorts World Genting.