Resorts World Genting (RWG) in Genting Highlands, Malaysia, reopened with “limited offerings” starting September 30. According to a statement from operator Genting Malaysia, RWG is accessible to Pahang residents only under Phase 3 of the country’s National Recovery Plan.
All RWG employees are fully vaccinated and some facilities are only available to fully vaccinated guests, the statement added.
According to the Malay Mail, Prime Minister Datuk Seri Ismail Sabri Yaakob had planned to OK a domestic travel bubble for Malaysian residents to travel to certain tourism spots, including Genting Highlands. Then he rescinded the order until 90 percent of the country’s adult population is fully vaccinated. As of last week, that figure currently was almost 85 percent and was projected to reach 90 percent within two weeks.
RWG had been closed since June 1 under Malaysia’s nationwide lockdown.
The reopening is expected to help the company reach breakeven in 4Q21, the first time it will have done so in over 18 months, said analyst Samuel Yin Shao Yang from Maybank Investment Bank. “We are optimistic that this will drive Genting Malaysia to breakeven in 4Q21 after what is likely six consecutive quarters of core net losses,” Yin wrote. “Catalyzed by the opening of Genting SkyWorld in 4Q21, we expect RWG visitor arrivals to further recover to pre-Covid-19 levels from FY22E onwards.”
Yin said the soon-to-open SkyWorld theme park will help propel the company forward. “We maintain our view that it will open in December 2021 to coincide with the school holidays,” he said. “Going forward, we are confident that it will attract both gaming and non-gaming visitors to Resorts World Genting. Our FY22E/FY23E core net profits (US$249 million in 2022 and US$305 million in 2023) are based on Resorts World Genting visitor arrivals of 24.2 million and 26.2 million.
“In short, we expect some sort of normalcy resembling pre-Covid-19 levels to return in FY22.” Brokerage Nomura agreed that the reopening of would be a “positive development” for parent Genting Malaysia, and Fitch Ratings said Genting Group’s credit outlook may be upgraded to stable in the next six to nine months as vaccination rollouts in its key markets reduce the likelihood of operating disruptions.
The firm said it was maintaining the group’s Issuer Default Rating at BBB, with a “negative” outlook, due to the lack of certainty about the reopening to international travel.
“We do not expect strict lockdowns given high vaccination rates, in line with government policies in Genting’s key markets,” Fitch said. “Therefore, we may revise the Outlook to Stable in the next six to nine months, if Genting builds a longer track record of operational stability, and demonstrates it is able to deleverage in line with our expectations.”
