14-05-2008: Genting International profit dips 91%

KUALA LUMPUR: Genting International plc’s profit for the first quarter ended March 31 came in less than one-tenth of the amount booked the same period last year due to lower business volume at its UK casino operations as well as higher bad debts.

Net profit came in at S$6.02 million (RM14.1 million), down 91% from S$67.55 million a year earlier, also from heftier gaming duties as well as a higher foreign exchange loss. It also saw lower gains from its derivative financial instruments of S$18.9 million versus the S$64.8 million gain recognised in 2007.

Revenue fell 14% to S$168.83 million from S$196.2 million, mainly due to a S$28.6 million decrease in revenue from its UK casino operations. The lower patronage there was exacerbated by the weakening of the pound sterling against the Singapore dollar, Genting International said yesterday.

As a smoking ban in all public enclosed areas in England and Wales from July last year had had an adverse impact on its gaming business, Genting International said it had taken steps to address the matter, including modifying its casinos “where possible” to enable access to external smoking areas.

As the largest casino operator in UK, it will also introduce measures to further reduce operating costs to help cushion effects of softer market conditions from the slip in consumer confidence.
In Singapore, Genting International said construction was “on-track” for the integrated resort’s soft opening in 2010. At least S$2.1 billion in construction contracts had been awarded as at March 31 and it “continues to be confident and optimistic about the prospects of Resorts World at Sentosa”.

Meanwhile, its wholly-owned subsidiary, Genting Stanley Aldeney Ltd, expects to start its online gaming business in the “later part of the second quarter of 2008”. It received its licence in March this year, but the permission to “go live” is subject to authorities’ approval of its internal control system and gambling equipment.

Genting International shares ended unchanged at 58 Singapore cents on the Singapore Exchange yesterday, with 11.3 million shares done.

Source