KUALA LUMPUR (Nov 30): Genting Malaysia Bhd (GENM), whose share price has been going downhill, announced its largest quarterly net loss of RM1.49 billion for the third quarter ended Sept 30, 2018 (3QFY18), due to an impairment of its investment into promissory notes issued by the Mashpee Wampanoag Tribe for the development of an integrated gaming resort in Massachusetts, US.
The group’s loss per share was massive at 26.41 sen versus an earnings per share of 3.42 sen previously.
Quarterly revenue grew by 14.5% to RM2.6 billion in 3QFY18, from RM2.27 billion last year.
Having released the quarterly losses, GENM cautioned that the revision in casino duties and license fee would impact its earnings next year.
“The group is reviewing its marketing strategies and will streamline its operations and cost structure to mitigate the impact of the tax increases. In the meantime, the group remains focused on the progressive roll out of the new Skytropolis Funland indoor theme park this year,” it said.
“Meanwhile, the group has commenced legal proceedings in relation to the development of the Twentieth Century Fox World theme park. The litigation is not expected to impact the group’s current business operations,” it added.
For the nine-month period ended Sept 30, the casino operator posted a net loss of RM739.73 million compared to a net profit of RM711.51 million in the same period last year.
Cumulative revenue for 9MFY18 grew 9.35% to RM7.42 billion from RM6.79 billion in 9MFY17.
In the UK, GENM said it endeavours to continue delivering sustainable performance by strengthening its position in the non-premium gaming business.
Additionally, the group said it will focus on enhancing the operating performance at Resorts World Birmingham as well as growing business volumes at the property.
In the US, GENM said Resorts World Casino New York City (RWNYC) remains the market leader in terms of gaming revenue in the Northeast US region despite growing regional competition.
“The group will continue intensifying its direct marketing efforts to increase visitation and frequency of play at the property. Meanwhile, the US$400 million expansion at RWNYC is well underway and is expected to open in phases from the end of 2019,” it said.
“In Miami, the group will continue leveraging on the newly renovated Hilton Miami Downtown Hotel to generate higher spend at the property. In the Bahamas, the group will focus on improving the infrastructure to grow visitation and revenues at Resorts World Bimini,” it added.
GENM has plunged 49% year to date no thanks to the slew of unpleasant news recently, including the sharp 10% hike on gaming duties that was announced in the National Budget 2019. The stock closed at RM2.86 — a level that is below most analysts’ target prices that were pegged prior to the result announcement.