Rising revenues not enough as Genting Malaysia reports Q2 loss of US$87 million

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Resorts World Genting

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Genting Malaysia reported a net loss of MYR366.7 million (US$87.4 million) in the three months to 30 June 2021, improved from a loss of MYR923.2 million (US$220.1 million) in 2Q20 due to improved revenues in all of its key markets.

Despite operations in Malaysia, the United States and the UK and Egypt continuing to be interrupted by COVID-19 closures, Genting Malaysia recorded a 700% year-on-year increase in group-wide revenue to MYR817.9 million (US$195.0 million) in 2Q21, with Adjusted EBITDA of MYR45.6 million (US$10.9 million) versus an EBITDA loss of MYR486.2 million (US$115.9 million) a year earlier.

At Resorts World Genting in Malaysia, revenue increased from MYR82.2 million (US$19.6 million) to MYR237.9 million (US$56.7 million) despite the property suspending operations from 1 June.

In the US and Bahamas, revenue soared from a zero base to MYR352.9 million (US$84.1 million) with Adjusted EBITDA of MYR109.3 million (US$26.1 million).

The improvement in earnings was also driven by the swift recovery registered at Resorts World Casino New York City (RWNYC), with the property achieving approximately the same level of gross gaming revenue this quarter as compared to the corresponding quarter in 2019, the company said.

Revenue in the UK and Egypt grew five-fold to MYR185.3 million (US$44.2 million) with Adjusted EBITDA of MYR14.3 million (US$3.4 million) thanks to the reopening of Resorts World Birmingham and the Groups land-based casinos in the UK as of 17 May 2021.

Genting Malaysia said it remains cautious as to its recovery prospects following a recent report from analysts suggesting Resorts World Genting will remain closed until November.

Challenges to global growth persist given ongoing concerns surrounding the evolving COVID-19 situation worldwide and potential risks of heightened financial market volatility, the company said.

In Malaysia, economic recovery is expected to be delayed by the earlier re-imposition of containment measures nationwide and increased spread of COVID-19.

While international travel has shown early signs of revival, the recent COVID-19 developments will continue to pose uncertainties to the outlook for the tourism, leisure, and hospitality sectors. The regional gaming market is expected to remain challenging in the short-term.

The Group maintains its cautious stance on the near-term prospects of the leisure and hospitality industry.