Local lockdown hits Genting Malaysia revenue in Q3

| By Marese O'Hagan
Genting Malaysia Berhad, one of the operating companies comprising the Genting Group conglomerate, has reported revenue of MYR826.2m (£146.1m/€172.8m) for its third quarter 2021 results.
Kuala Lumpur

This was a decrease of 41.6% compared to the same period in 2020.

Leisure and hospitality made up a majority of the revenue. For Genting’s Resorts World Kijal, Genting and Langkawi locations in Malaysia the revenue came to MYR17.7m, down by MYR1.16bn year-on-year.

This was a 99.0% decrease in revenue, primarily due to the closure of Resorts World Genting due to Malaysia’s novel coronavirus (Covid-19) lockdown, with the property not reopening until 30 September, the final day of the reporting period.

The reopening of land-based casinos in the UK in May after Covid-19 lockdowns partially mitigated the Malaysia shutdown. The Genting UK estate, Resorts World Birmingham and Crockford Cairo in Egypt generated revenue of MYR406.0m, a rise of 209.0%.

This was largely down to the properties being shuttered for much, if not all, of Q3 2020.

In the US, Resorts World New York City and Resorts World Catskills, and Resorts World Bimini in the Bahamas also saw revenue rise, from MYR69.9m in 2020 to MYR364.2m in Q3 2021. Resorts World New York City remained closed as a result of the pandemic, until June 2021.

Overall, leisure and hospitality revenue totalled MYR787.9m, a 43.0% year-on-year decrease.

Other property revenue came to MYR20.3m, a rise of 14.0%, while investment revenue increased by MYR1.6m to MYR18.1m.

Turning to expenses, cost of sales amounted to MYR891.8m, down 26.1% year-on-year. However this resulted in a gross loss of MYR65.6m for the quarter, though this was reduced from MYR 275.2m in Q3 2020

Other income reduced the business’ losses by MYR63.7m. However other expenses, losses and impairment charges resulted an an operating loss of MYR252.7m, up marginally year-on-year.

Finance costs came to MYR95.4m, and while this was offset by Genting Malaysia’s share of profits from an affiliated business totalling MYR30.9m. After paying MYR72.1m in taxes, Genting Malaysia’s net loss for the quarter came to MYR307.0m.

The third quarter’s contribution brought the operator’s revenue for the nine months to 30 September to MYR2.26bn, down 35.0%.

Year-to-date cost of sales stands at MYR2.56bn, and after expenses Genting Malaysia’s operating loss was MYR906.0m, a 32.4% increase on 2020. After finance costs and taxation, its net loss for the nine month period came to MYR1.30bn.

Looking ahead, Genting warned that it may face further pain from supply chain issues, which alongside rising energy costs and inflation may hinder growth.

However, it added, Mayalsia’s emergence from the Covid-19 pandemic puts its local properties in a strong position, especially as border restrictions are eased and vaccine roll-outs help tourism return.