Genting Singapore Q3 net profit falls by 24.5% to S$158.9 million

RESORTS World Sentosa operator Genting Singapore saw its third-quarter profits plunge on the back of higher cost of sales, according to results released on Thursday.

Net profit for the three months to Sept 30 fell by 24.5 per cent year on year, to S$158.9 million, as revenue declined by 6.7 per cent to S$596.1 million.

The top line shrank amid a double-digit drop in core gaming takings from the Singapore integrated resort business, with the impact worsened by a 7.7 per cent increase in sales costs.

Earnings per share fell to 1.32 Singapore cents, from 1.75 Singapore cents before.

Genting Singapore also pointed out a jump in depreciation costs in the quarter - the depreciation of property, plant and equipment rose to S$94.7 million, from S$66.1 million before - amid its "plans to retire certain assets" ahead of a five-year mega-expansion at Resorts World Sentosa.

The group noted in its financial statements that it had faced "a confluence of headwinds" in the quarter, but added that it remains positive on the regional "affluent market" in Asia.

For the nine months, net profit was down by 12 per cent to S$532.8 million, while revenue was stable at S$1.87 billion.

In its outlook statement, Genting Singapore said that the opening of new attractions during its expansion will boost Resorts World Sentosa's appeal and will anchor the government's recently unveiled Sentosa-Brani Master Plan to redevelop the resort island.

Meanwhile, Genting Singapore is also moving forward with a medium-term growth strategy to diversify into Japan. It is preparing integrated resort bids in Osaka and Yokohama, and has taken steps with the local finance authorities to issue new yen-denominated bonds, it said.

No dividend was recommended for the quarter, unchanged from the year prior, as the group generally makes payouts on a twice-yearly basis.

The counter closed up by half a Singapore cent, or 0.52 per cent, to S$0.96, before the results.