Genting Singapore shares down 29 percent
Resorts World Sentosa in Singapore has seen a marked rise in visitation, with arrivals up almost 20 percent in the third quarter of 2015, according to investment analysts cited by GGRAsia. However, average daily spending by those visitors dropped in the same period, added the note from Daiwa Securities Group Inc.
The casino resort is operated by Genting Singapore Plc. “One bright spot for Genting is the non-gaming segment, which saw a record quarter of visitor arrivals of about 21,000 per day in the third quarter 2015 (versus 18,000 to 19,000 daily) in the third quarter 2014,” wrote Daiwa’s Ramakrishna Maruvada and Shane Goh. “However, average daily spending has fallen by 6 percent to 10 percent year-on-year, likely as a result of softer regional currencies.”
The analysts, who conferred with Genting management before publishing the note, added that “the broader mass market customer base in Singapore is nearing saturation,” and the property will focus on “overseas markets, such as Thailand, to grow its pool of customers.” Thailand has no licensed casinos.
Genting Singapore’s share price had plummeted by 29 percent by the end of the year; the firm posted a 62 percent year-on-year decline in third-quarter net profit to SGD37.2 million (US$26.3 million). The decrease was attributed to a decline in gaming revenues “and an increase in bad debt write-offs,” reported GGRAsia, citing a filing to the Singapore Exchange.
Union Gaming Securities Asia Ltd said in a note following Genting Singapore’s third quarter numbers that it estimated Resorts World Sentosa had a 36 percent share of the Singapore casino market’s VIP gambling rolling chip volume during the period, and an approximate 40 percent share of mass market gross gaming revenue.
