Still no dividend payout for Genting shareholders

SINGAPORE: If you own Genting International shares, don't bet on receiving dividends anytime soon. It has been almost 20 years since the casino operator last rewarded its shareholders with a dividend payout. And its board of directors warned on Friday that shareholders may have to wait at least a few more years.

At Genting's annual general meeting, several shareholders asked the board when they would finally receive a dividend payout. The answer was "at least five years from now".

Managing director Justin Tan said the company's finances would likely remain stretched for the first few years after the opening of its Resorts World integrated resort on Sentosa in 2010.

This is because the firm has to repay almost S$1 billion in loan each year over the next five years. This is for a loan of almost S$4.2 billion that Genting had obtained from over 20 banks early last year to fund the building of the integrated resort.

But once the company has stabilised its gearing, Mr Tan said, it would definitely reward its shareholders. This answer was good enough for at least one shareholder, who declined to be named.

The shareholder said: "Dividends are important, but until and unless the company has established itself and there is some balance in the company, then it can start paying slowly, stage by stage, in order to keep the shareholders happy, if the company does make money. If it doesn't make money, you have to bear with it for a little while."

Genting's board said it is confident that Resorts World Sentosa will be completed within budget, as labour and material costs have stabilised. As such, the firm has no plans to launch a rights issue to raise more funds.

The board added that the integrated resort is on track for its soft opening in the first quarter of 2010. On day one, four of the six planned hotels at the resort should be ready, as well as a Universal Studios theme park and the casino.

Genting's CEO Lim Kok Thay said he is confident that Resorts World will be able to reach its target of seven to eight million visitors in its first year, and 10 million annually thereafter.

Source