KUALA LUMPUR (Nov 23): Genting Malaysia Bhd (GenM) recorded a net profit of RM177.41 million or 3.13 sen per share for the third quarter ended Sept 30, 2023 (3QFY2023), the group’s highest quarterly profit since the Covid-19 outbreak in 1QFY2020, thanks to continued recovery in its leisure and hospitality businesses.
The group’s impairment losses of RM12.8 million on certain casino licences in 3QFY2023 was also significantly lower than the RM47.6 million write-off incurred in 3QFY2022, which were related to receivables in the US and certain vacant leased properties in the UK.
Net profit for 3QFY2023 shot up by over 15 times, from a meagre RM11.38 million or 0.2 sen per share a year ago, the casino-and-resort operator’s stock exchange filing showed on Thursday (Nov 23).
Revenue grew 19% to RM2.71 billion in 3QFY2023 from RM2.27 billion in 3QFY2022 as business volume was higher in Malaysia, UK and Egypt, while the group’s US and Bahamas operations enjoyed higher contributions from Resorts World New York City (RWNYC).
For the cumulative nine-month period (9MFY2023), GenM recorded a net profit of RM197.15 million, versus a net loss of RM126.00 million in the previous corresponding period, while revenue grew 21% to RM7.47 billion from RM6.17 billion.
Going forward, GenM said the positive outlook for international tourism is expected to be sustained, although macroeconomic concerns could continue being a critical factor in the effective recovery of the travel and tourism sectors.
Meanwhile, the group said the regional gaming market is expected to continue recovering as airline capacity and air connectivity in the region improves.
“The group remains cautious of the near-term outlook of the leisure and hospitality industry but is positive in the longer term,” it said.
Commenting on its hilltop resort in Malaysia, the group said ongoing upgrading and development works at the mid-hill are progressing well, with new product offerings and attractions in the pipeline.
“The group will also continue to invest in infrastructure enhancements at Genting Highlands to ensure the safety of visitors and the surrounding community,” it said.
In the UK, GenM said it remains cautious of the challenges implicit in the operating environment.
“The group will continue to explore strategies to strengthen the resilience of its business, which include reorganising its operations to optimise efficiencies, whilst exploring opportunities to deliver growth.
“Proactive cost management efforts will concurrently be emphasised to improve operating margins and enhance the agility of the group’s operations in navigating the volatile environment,” it said.
In the US, GenM said it is exploring opportunities to reinforce its competitive position in the region, which include developments surrounding the New York Gaming Facility Board’s Request for Application to solicit proposals for up to three commercial casinos in New York State.
“Meanwhile, the group will continue to implement various productivity enhancement initiatives and capability-sharing efforts to drive synergies between RWNYC and Empire Resorts Inc’s properties and improve the overall returns of the group’s US business,” it said.
At the Bahamas, GenM said it will continue to collaborate with international cruise operators to increase the number of port calls at Resorts World Bimini.
“Additionally, the group will keep intensifying marketing efforts and promotional activities to grow visitation at the resort. Meanwhile, emphasis remains on stringent financial management and driving operational efficiencies to improve the profitability of the group’s operations,” it said.
Shares of GenM closed two sen or 0.8% at RM2.58, giving it a market capitalisation of RM15.32 billion.