Genting Malaysia Berhad records a disappointing fourth quarter

Asian casino operator Genting Malaysia Berhad has reportedly released its unaudited financial results for the final three months of 2019 showing that its net profit had crashed by almost 60% year-on-year to about $66.9 million as aggregated revenues declined by 2.6% to slightly over $578.9 million.

According to reports from Inside Asian Gaming and GGRAsia, the Kuala Lumpur-listed firm used an official Thursday filing to moreover reveal that its adjusted earnings before interest, tax, depreciation and amortization for the three months to the end of December had dropped by 26.3% year-on-year to around $130.7 million as revenues and earnings from operations in its home nation of Malaysia shrunk by 5.5% and 28.7% respectively.

Tax trepidation:

Genting Malaysia Berhad is responsible for large casino resorts around the world including the sprawling Resorts World Genting development in Malaysia alongside Singapore’s Resorts World Sentosa venue and it reportedly declared that its fourth-quarter earnings before interest, tax, depreciation and amortization had also been negatively impacted by the imposition of ‘higher gaming duties’.

Empire enthusiasm:

GGRAsia reported that the giant operator additionally detailed that it had recorded an almost $7.5 million loss during the fourth quarter on its investment in American counterpart Empire Resorts Incorporated, which runs the Resorts World Catskills property in upstate New York. Genting Malaysia Berhad purportedly proclaimed that it now fully owns this smaller firm following the completion of a $128.6 million buy-out deal and has since seen ‘marked improvements’ at the facility with its gaming revenues having risen by some 33% in December alone.

Annual achievements:

For its part and Inside Asian Gaming reported that the news was considerably better regarding the full-year performance of Genting Malaysia Berhad with the firm returning to profit to the tune of about $315.3 million. This purportedly followed a $20.4 million deficit for 2018 as the operator struggled with an impairment loss tied to its investment in the planned First Light Resort and Casino facility from Massachusetts’ Mashpee Wampanoag Tribe.

Inside Asian Gaming furthermore reported that the casino behemoth had finished December with aggregated annual revenues of $2.4 billion, which represented a rise of 4.8% year-on-year, although its associated earnings before interest, tax, depreciation and amortization fell by some 8% to slightly over $625.8 million.

Imminent issues:

Regarding the future and Genting Malaysia Berhad reportedly detailed that it was now unsure about previous predictions of growth in the global economy and that any downturn would place even more pressure on regional casino operators. It purportedly moreover stated that associated downsides are currently even ‘more pronounced due to heightened global concerns over the impact of the coronavirus disease’ alongside anxieties regarding ‘protracted geopolitical tensions and policy uncertainties’.

Reportedly read a statement from Genting Malaysia Berhad…

“Demand for international travel is expected to decline in the near-term following the imposition of travel restrictions and widespread concerns surrounding the coronavirus outbreak. The regional leisure and hospitality industry including the gaming industry will be adversely impacted. Consequently, the group is more cautious on the near-term prospects of the leisure and hospitality industry.”