Genting Malaysia Reports Third-Quarter Deficit Due to COVID-19

Genting Malaysia, a branch of the Genting Group, reported a third-quarter deficit of 726.2 million Malaysian ringgit ($178.5 million), as its operations continued to be affected by COVID-19 regulations.

The group’s third-quarter income was 1.42 billion ringgit, a decrease of 46.1% from 2.63 billion ringgit in the same period the previous year.

While many hotels across the globe resumed operations in the third quarter, Genting Malaysia had to deal with various COVID-19 related limitations, including decreased capacity.

Income from its leisure and hospitality business in Malaysia dropped 34.2% to 1.18 billion ringgit, mainly due to lower volumes from the general market and non-gaming sections. However, volumes from high and mid-end players remained at the previous year’s levels.

Leisure and hospitality operations in the UK and Egypt also declined by 68.3% to 131.4 million ringgit, due to lower volumes, with UK casinos resuming operations in mid-August but with reduced capacity. Casinos in Egypt and some land-based casinos in the UK were temporarily closed throughout the third quarter.

Meanwhile, income in the US and Bahamas fell 80.4% year-on-year to 69 million ringgit. Genting Malaysia’s third-quarter deficit of 726.2 million ringgit was impacted by the COVID-19 pandemic – iGB

As a result of the temporary closure of Resorts World Casino in New York City until September 9th, and a reduction in capacity, income for September declined by RM9 million.

Property income decreased by 25.2% year-over-year to RM17.8 million, while investment and other revenue more than halved to RM16.5 million from RM37.3 million.

The cost of goods sold was RM1.21 billion, leading to an operational deficit of RM231.9 million for Genting Malaysia after accounting for an operational loss of RM51.9 million and an impairment loss of RM180 million, compared to a profit of RM507.1 million in 2019.

The operator also recorded RM67.4 million in financing costs and RM62 million in expenses related to another company’s investment, resulting in a pre-tax deficit of RM726.2 million.

Genting Malaysia paid RM365 million in taxes in the third quarter, and after including costs related to non-controlling interests of RM21.6 million, the total loss for the period was RM726.2 million, compared to a profit of RM393.8 million last year.

Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also dropped by 55.3% to RM310.7 million.

In terms of the effect on the operator’s year-to-date performance, revenue for the nine months ending September was RM3.49 billion, down 56.2% from 2019.

Revenue in Malaysia decreased by 54.4% to RM2.49 billion, while revenue in the UK and Egypt decreased by 57.3% to RM535.8 million, and revenue in the US and Bahamas decreased by 67.4% to RM359 million.

The nine-month operating loss was RM799.3 million, compared to a profit of RM1.42 billion last year, and after including financing costs and related costs, the pre-tax loss was RM100 million.

The year 2019 saw Genting Malaysia’s income at 1.2 billion Malaysian Ringgit, but this year it has surged to 85 billion Ringgit.

Genting Malaysia paid 250.9 million Ringgit in taxes and incurred 80.3 million Ringgit in non-controlling interest expenses, leading to a profit for the period of 2.1 billion Ringgit, lower than the previous year’s 10.5 billion Ringgit.

The company also indicated that adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) dropped by 91.4% to 179.9 million Ringgit.

Earlier in the month, Genting Singapore announced its third-quarter financial results, with revenue declining by 49.5% year-over-year to 301 million Singapore dollars. Net profit for the quarter also decreased by 65.7% to 54.4 million Singapore dollars.

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