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Genting Singapore PLC’s Latest Earnings: Revenue Falls Again

Genting Singapore PLC (SGX: G13) reported its second-quarter earnings yesterday evening. The reporting period was for 1 April 2016 to 30 June 2016.

As a brief background for some context, Genting Singapore is the operator of the integrated resort, Resorts World Sentosa. Among the resort’s many attractions are one of Singapore’s two casinos and the Universal Studios Singapore theme park.

You can learn more about the company in here or catch up with the results from its previous quarter here.

Financial highlights

The following’s a rundown on some of the latest financial figures for Genting Singapore:

  1. For the second quarter, Genting Singapore’s revenue dropped by 17% year–on-year to $480.9 million.
  2. Net profit, though, rose over 50% year-on-year to $18.9 million. But, as Genting Singapore has to distribute a portion of its net profit to holders of its perpetual capital securities, the net profit attributable to shareholders was a negative S$10.5 million instead,  better than the negative $16.9 million recorded a year ago.
  3. Consequently, Genting Singapore recorded earnings per share (EPS) of a negative 0.09 cents for the second-quarter of 2016.
  4. Cash flow from operations was $295 million for the reporting quarter while capital expenditure came in at $22.3 million. This gave Genting Singapore positive free cash flow of $272.7 million for the quarter, down from the $306.1 million seen a year ago.
  5. As of 30 June 2016, Genting Singapore had $4.87 billion in cash and equivalents and $1.55 billion in debt. This is an improvement from the $4.38 billion in cash and equivalents and $1.73 billion in debt that Genting Singapore had at the end of June 2015.

Genting Singapore’s revenue shrank in the second-quarter of 2016; this follows the 5% revenue decline recorded in the previous sequential quarter. Moreover, Genting Singapore recorded losses attributable to shareholders.

But, the company still maintains a healthy balance sheet and generates positive free cash flow.

Operational highlights

For the second-quarter, the Gaming segment’s revenue was again behind much of the total revenue decline. The segment’s top-line fell by 23% to $331.9 million. Meanwhile, Non-Gaming revenue posted a 1% year-on-year decrease to $148.5 million. Genting Singapore’s management team had included the following commentary on the quarter:

“The Asian gaming market continues to face challenges. RWS [Resorts World Sentosa] has been able to maintain good earnings in the mass and premium mass market despite a weak environment. However, our premium market has been significantly impacted by a low win percentage.

On a theoretical normalised hold basis, RWS would have generated revenue and adjusted EBITDA of $552.9 million and $192.3 million, respectively. For the comparative quarter in 2015, Adjusted EBITDA included a one-off property tax refund of $102.7 million.

RWS non-gaming business continues to perform well with the combined attractions sector maintaining a daily average visitation exceeding 18,000 this quarter and hotel businesses recorded an overall occupancy rate of 93%.”

There was also updates given on the company’s development of an integrated resort in South Korea:

“The development of our joint venture integrated resort project in Jeju, South Korea, is progressing well and on schedule. The take up of the residential plot continues to be well received and we are on track for the soft opening of Phase 1 in Quarter 4, 2017”

At its closing share price of $0.80 yesterday, Genting Singapore traded at over 300 times trailing earnings and has a trailing dividend yield of 1.9%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.