Genting Malaysia experienced a financial setback of 7.262 billion Malaysian ringgit (roughly 133.9 million pounds/149.6 million euros/178.5 million dollars) in the final three months of the year, as a consequence of the ongoing effects of the COVID-19 outbreak, the Genting Malaysia division of the Genting Group announced.
The group’s earnings for the period ending September 30 were 1.42 billion ringgit, a significant decrease of 46.1% compared to the 2.63 billion ringgit recorded in the same period the previous year.
Despite the resumption of operations at some of its properties during the third quarter, Genting Malaysia faced numerous COVID-19-related limitations, including reduced occupancy levels.
Income from the Malaysian leisure and hospitality business experienced a decline of 34.2% to 1.18 billion ringgit, primarily due to reduced activity from the general market and non-gaming sectors. However, business from high-end and mid-range patrons remained consistent with the previous year.
Leisure and hospitality operations in the UK and Egypt also witnessed a decrease of 68.3% to 131.4 million ringgit, attributed to a drop in business volume. UK casinos resumed operations in mid-August, but with reduced capacity. Casinos in Egypt and certain land-based casinos in the UK remained temporarily closed throughout the third quarter.
Meanwhile, revenue in the US and Bahamas experienced a substantial year-on-year decline of 80.4% to 69 million ringgit.
Genting Malaysia’s earnings for September took a hit, dropping by RM9 million. This was due to the temporary closure of Resorts World Casino in New York City until September 9th, and reduced capacity.
The property’s revenue experienced a significant decrease, falling by 25.2% year-over-year to RM17.8 million. Meanwhile, investment and other income saw a substantial decline, plummeting by more than half to RM16.5 million from RM37.3 million.
The cost of goods sold reached RM1.21 billion, resulting in an operating loss of RM231.9 million for Genting Malaysia. This was after accounting for an operating loss of RM51.9 million and an impairment loss of RM180 million, a stark contrast to the profit of RM507.1 million recorded in 2019.
The operator also incurred RM67.4 million in financing expenses and RM62 million in expenses related to equity in another entity. This led to a pre-tax loss of RM726.2 million.
Genting Malaysia paid RM365 million in taxes during the third quarter. After including costs associated with non-controlling interests of RM21.6 million, the total loss for the period amounted to RM726.2 million. This is a significant downturn compared to the profit of RM393.8 million achieved in the previous year.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also experienced a substantial decline, falling by 55.3% to RM310.7 million.
Examining the impact on the operator’s annual cumulative results, revenue for the nine months ending September reached RM3.49 billion. This represents a decrease of 56.2% compared to 2019.
Revenue in Malaysia experienced a significant drop, falling by 54.4% to RM2.49 billion. Meanwhile, revenue in the UK and Egypt declined by 57.3% to RM5.358 billion, and revenue in the US and Bahamas fell by 67.4% to RM359 million.
The operating loss for the nine months amounted to RM799.3 million, a stark contrast to the profit of RM1.42 billion recorded in the previous year. After factoring in financing costs and related expenses, the pre-tax loss reached RM1 billion.
The year 2019 saw Genting Malaysia’s earnings at 1.2 billion Malaysian Ringgit, but this year the figure has skyrocketed to 85 billion Ringgit.
The corporation paid 250.9 million Ringgit in taxes and recorded a non-controlling interest expense of 80.3 million Ringgit, leading to a net profit for the period of 2.1 billion Ringgit, a decrease from the 1.05 billion Ringgit recorded in the same timeframe last year.
The operator also remarked that adjusted EBITDA declined by 91.4% to 179.9 million Ringgit.
Earlier this month, Genting Singapore announced its third-quarter financial outcomes, with revenue dropping by 49.5% year-over-year to 301 million Singapore dollars. Net profit for the quarter also decreased by 65.7% to 54.4 million Singapore dollars.
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