Genting Malaysia 4Q net profit dips 22.6%

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KUALA LUMPUR: Genting Malaysia Bhd registered a 22.6% dip in net profit to RM309.84 million or 5.46 sen per share for the fourth quarter ended Dec 31, 2014 (4QFY14) from RM400.52 million or 7.06 sen per share a year ago, after a RM55.5 million write-off of project costs in relation to its unsuccessful application of licences in New York, as well as a higher assets write-off relating to the Genting Integrated Tourism Plan.

The earnings dip seen in 4QFY14 was also due to the over provision of prior year’s deferred tax, which resulted in a lower tax charge in 4QFY13. Excluding the impact of such deferred tax, the group’s net profit would have decreased by only 9%, said Genting Malaysia in a filing with Bursa Malaysia yesterday.Revenue for the quarter was RM2.06 billion, down 2.9% from RM2.12 billion in 4QFY13.

It has proposed a 3.5 sen dividend for the quarter, which would bring total dividend for FY14 to 6.5 sen, compared with 8.2 sen in FY13.

Genting Malaysia (fundamental: 2.4; valuation: 0.6) said for 4QFY14, its Malaysian leisure and hospitality business declined 2% to RM1.42 billion due to lower hold percentage in the premium players business, despite an overall higher volume of business. It added that Resorts World Genting’s number of visitors were affected by redevelopment works, but that its core business remained “resilient”.

Revenue from the group’s United Kingdom operations decreased 17% to RM342.1 million, mainly due to a lower hold percentage in its international markets division — which caters to the premium players business at four of its London casinos — albeit with an overall higher volume of business.

Meanwhile, its operations in the United States, which includes Resorts World Bimini (Bimini) in the Bahamas, generated a 12% increase in revenue to RM264.4 million. This was mainly contributed by higher volume of business from the operations at Resorts World Casino New York City as well as Bimini.

For the full-year FY14, the gaming giant’s profit declined 25.8% from RM1.6 billion or 28.26 sen to RM1.19 billion or 20.96 sen in FY13.Revenue for the year remained flat at RM8.33 billion compared to RM8.23 billion in FY13.

 

This article first appeared in The Edge Financial Daily, on February 27, 2015.