Genting Malaysia announces restructuring exercise, including pay cut and 'rightsizing of workforce'

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KUALA LUMPUR (May 22): As the Covid-19 pandemic hits it hard, Genting Malaysia Bhd (GENM) has announced that it is undertaking a restructuring exercise at its home operations including voluntary pay cut and "rightsizing its workforce".

In a statement issued today, GENM said its management team has volunteered to have salary reduction of up to 20%.

Yesterday, theedgemarkets.com, citing sources, wrote that GENM will be retrenching about 10% to 20% of its staff force. GENM has a total workforce of 20,000 worldwide, according to its latest annual report.

GENM has embarked on austerity measures to ensure the long-term sustainability of its business in response to these challenging conditions caused by the pandemic, said the hilltop casino operator.

"In order to further manage costs and to mitigate the adverse financial impact, GENM has had to assess and recalibrate its cost structure including staffing needs based on its current and anticipated future operating capacity," said GENM.

GENM noted that Resorts World Genting's (RWG) businesses support more than 70,000 jobs in Malaysia, which include its own employees, third-party businesses, local suppliers and contractors.

To curb the spread of the virus, this has led to the shutdown of all its casinos, the first time in its 55-year-long history.

Apart from RWG that GENM owns and operates, Resorts World Awana, Resorts World Kijal and Resorts World Langkawi have also not been spared from the difficulties of these unprecedented times.

During this prolonged closure, GENM said it continues to incur significant costs to maintain its infrastructure, facilities, welfare of employees and other operating costs.

GENM said the outlook remains uncertain as the pandemic evolves, adding that the "new normal" of coexisting with the pandemic will see RWG reopen on a staggered basis as the company responds and adapts to strict operating protocols to protect its customers and employees.

"For these reasons, GENM foresees its business recovery in the short term to be extremely challenging," said the casino operator.

Due to the temporary disruptions to its worldwide operations from the pandemic, GENM suffered a net loss of RM417.96 million in the first quarter of 2020, and the company's financial performance and operations for the rest of the year also remain uncertain at this point in time.

"When business operations resume, GENM will face challenges to regain the level of business the company saw prior to the pandemic due to the severe impact that Covid-19 has inflicted on both domestic and global economies," the casino operator added.

Shares in GENM closed seven sen or 2.97% lower at RM2.29, valuing the company at RM13.6 billion. Year-to-date, the counter has declined some 28% from RM3.18.

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