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Genting Group reveals US$351 million loss in 2Q20

Genting Berhad, the parent company of both Genting Malaysia and Genting Singapore, fell to a MYR1.47 billion (US$351.2 million) loss in the three months to 30 June 2020 as COVID-19 wreaked havoc on its gaming and hospitality businesses.

With casinos across the globe closed and travel restrictions leaving its hotels largely empty, Genting’s results included an MYR841.4 million (US$201.7 million) loss from the leisure and hospitality business, where revenue declined by 96% to just MYR160.3 million (US$38.4 million) compared with MYR4.49 billion (US$1.08 billion) over the same period in 2019.

Of its core businesses, Genting Singapore – which operates Resorts World Sentosa – saw its revenue fall 96% to MYR78.0 million (US$18.7 million) while Genting Malaysia, which runs Resorts World Genting near Kuala Lumpur, declined by 95% to MYR80.8 million (US$19.4 million). Genting’s UK and Egypt properties reported a 92% decline in revenue to MYR33.2 million (US$8.0 million).

The group reported an EBITDA loss for the quarter of MYR578.7 million (US$138.7 million) compared with Adjusted EBITDA of MYR1.99 billion (US$476.9 million) in 2Q19.

The subdued results come as another blow to Genting Berhad’s controlling shareholder, Lim Kok Thay, following revelations that another of his companies in Genting Hong Kong – which last week said it was ceasing all loan repayments to focus solely on operational costs – is set to announce losses of more US$600 million for the first half of 2020.

While Genting doesn’t have any interest in the cruise ship operator, the two are linked via Lim who holds a 44.8% stake in Genting Berhad and 77.55% in Genting Hong Kong. There have been reports that Lim, in theory, could use Genting Berhad and its subsidiaries to bail out Genting HK, which met with creditors earlier this week to try and bash out some sort of deal on its growing debts.

Despite such distractions, the group continues to push forward with development of its US$4.3 billion Resorts World Las Vegas Project, due to open in 2021. Genting said total land and development costs accrued in Las Vegas as of 30 June 2020 were US$2.4 billion, leaving almost US$2 billion more to come over the next 12 months.

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