While the “very high” holdings in the VIP gambling division of Resorts World Sentosa (pictured) helped Genting Singapore’s first-quarter business performance, several brokers say the background to this year’s still lurking issues of player bad debt and other business costs.
Genting Singapore, which operates half of Singapore’s casino duopoly, reported first-quarter trading highlights in a report to the Singapore Exchange after-hours on Friday, doubling its quarterly net profit from the previous quarter.
“Headline EBITDA [earnings before interest, taxation, depreciation and amortisation] posted very strong (more than 45% beat versus consensus) performance, driven by very unexpected high VIP fortunes,” banking group JP Morgan said in a note on Saturday
The agency added: “Singapore only discloses details of non-performing loans on a semi-annual basis. However, according to estimates, non-performing loans in the first quarter remained elevated relative to pre-COVID levels, although lower than the very high levels in the last quarter.”
“Adjusted EBITDA margin was higher at 47% compared to 35% in the fourth quarter of 2023,” banking group Nomura said in its assessment of Genting Singapore’s Q1 highlights
Analysts Tushar Mohata and Alpa Aggarwal noted, “This was driven mainly by the expected seasonal strength as we saw seasonal strength due to the Lunar New Year holidays, above-normal VIP wins, and popular concerts.”
Genting Singapore commented in April on the impact of large entertainment events on its casino resort business in the city-state following inquiries from investors. Commenting on the recent large-scale concerts held in Singapore by international performance groups Coldplay, Taylor Swift, and Bruno Mars, Genting Singapore said, “Large concerts featuring internationally renowned artists amplify Singapore’s global brand and international status as a vibrant tourist destination.”
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