Tourism Revival a Boon for Genting
Genting Bhd is expecting international tourism to remain strong, with continued growth driven by positive demand and the ongoing recovery in global travel.
Consequently, the operator of integrated resorts said the regional gaming market is expected to maintain its recovery momentum.
With the release of its results for the fourth quarter (4Q24) and the full year for 2024 (FY24), Genting posted a net loss of RM169.4mil, a reversal from the RM150mil profit it made in 4Q23.
Revenue also slipped 5.3% year-on-year (y-o-y) to RM6.88bil, which Genting attributed to lower income from its leisure and hospitality division.
Looking at the whole FY24, the group saw net profit dip 5% y-o-y to RM882.9mil, despite a marginal 2.2% increase in turnover to RM27.7bil.
Genting said the increase in yearly revenue was attributable mainly to the contribution from its leisure and hospitality division.
“Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) of RM8.78bil for FY24 was marginally lower over the previous financial year,” it reported.
Genting said higher revenue was recorded by Resorts World Sentosa (RWS) in Singapore as the resort delivered a strong performance across both the gaming and non-gaming categories for FY24.
Although turnover had surpassed pre-pandemic levels, the group said rising costs and inflationary pressure remained significant challenges, contributing to a decline in adjusted Ebitda.
Additionally, revenue from Resorts World Genting (RWG) in FY24 was higher mainly due to an increased volume of business compared with FY23.
The leisure and hospitality businesses in the Britain and Egypt recorded higher revenue mainly due to a higher volume of business, matched by Resorts World New York City (RWNYC) and Resorts World Bimini, which also saw higher income primarily due to higher contribution from RWNYC as a result of better volume.
At the same time, Genting said its plantation division’s revenue was marginally lower in FY24, primarily attributable to lower sales in the downstream manufacturing segment, partly mitigated by higher palm product prices.
“However, adjusted Ebitda was higher on the back of stronger palm product prices. The downstream-manufacturing segment also recorded higher adjusted Ebitda in FY24 attributable to improved margins,” the group added.
Meanwhile, the group’s subsidiary Genting Malaysia Bhd (GENM) similarly saw a net loss of RM457.9mil for 4Q24, compared with a RM239.6mil net profit in 4Q23, even though revenue had stayed flattish at RM2.73bil.
GENM attributed the 4Q24 net loss to the recognition of net unrealised foreign exchange losses of RM356.9mil mainly on its US dollar denominated borrowings recorded in 4Q24 compared with net unrealised foreign exchange gains of RM130.4mil in 4Q23.
It said a higher share of losses in associates of RM13.2mil due to higher operating expenses in 4Q24 also impacted earnings during the quarter.
GENM said net profit for FY24 decreased by 42.5% y-o-y to RM251.3mil, even though turnover grew 7.1% to RM10.9bil.
It said the growth in revenue was primarily due to higher volumes of business seen in the leisure and hospitality business in Malaysia, Britain and Egypt, as well as in the United States and the Bahamas.
While posting higher y-o-y Ebitda of RM2.9bil in FY24, GENM attributed higher operating expenses, including payroll related expenses across all business segments, to the lower net earnings.
Genting declared a dividend of five sen per share for 4Q24, bringing its total dividends for FY24 to 11 sen, while GENM also proposed a dividend of four sen per share for 4Q24, bringing total dividends for FY24 to 10 sen per share.
Separately, Genting’s plantation unit Genting Plantations Bhd (GenP) announced that Datuk Indera Lim Keong Hui will assume the role of chief executive effective March 1, transitioning from his position as deputy chief executive, which he has held since Jan 1, 2019.
In a statement, the plantation group said Lim remained a non-independent executive director of GenP.
Keong Hui, the son of Tan Sri Lim Kok Thay, who is current chairman and chief executive of Genting, also holds positions at Genting Bhd and Genting Malaysia , both as deputy chief executive and executive director.
GenP said the appointment followed Datuk Seri Tan Kong Han stepping down as chief executive on the same date, a role he had held since 2019.
Tan will no longer manage GenP’s daily operations but will remain an executive director and support Lim in leading the group.
Meanwhile, Genting Bhd has appointed Tan as its new chief executive officer, effective March 1, replacing Kok Thay, who has held the position for nearly two decades.
$GENTING / 3182 (GENTING BERHAD)
$GENM / 4715 (GENTING MALAYSIA BERHAD)
$GENP / 2291 (GENTING PLANTATIONS BERHAD)
Source: The Star