Genting Third-Quarter Profit Falls on U.K. Writedown(Update 1)
Updated : 22-11-2007
Media : Bloomberg
Story By : Angus Whitley
(Adds analyst's comment in fourth paragraph.)
Nov. 22 (Bloomberg) -- Genting Bhd., Asia's largest listed casino operator, said third-quarter profit fell after higher U.K. gaming tax led to a writedown at the company's British unit.
Net income dropped 34 percent to 275.2 million ringgit ($81 million), or 7.45 sen a share, from 418.7 million ringgit, or 11.87 sen, a year earlier, Genting said in a release today. The company proposed a dividend of 30 sen a share, or 807 million ringgit, in memory of founder Lim Goh Tong, who died last month.
A 937.8 million-ringgit impairment charge, mostly at Genting's U.K. betting chain, offset higher income at the Malaysian casino unit and power division. The British government unexpectedly raised gaming taxes in April and a July smoking ban deterred gamblers. That triggered the writedown and hindered Genting's international expansion plans, some analysts said.
``The main reason people buy Genting shares is for the expansion overseas,'' said Hoe Lee Leng, an analyst at RHB Research Institute Sdn., who rates the stock as ``outperform''. The scale of expansion that investors expected ``hasn't materialized yet.'' Investors should buy Genting shares, she said.
Genting has climbed 14 percent this year, trailing the 23 percent gain on the benchmark Kuala Lumpur Composite Index. The stock, which reached 9.25 ringgit in April, closed at 7.5 ringgit today. The company reported earnings after close of trading today.
Group revenue surged 40 percent to 2.22 billion ringgit. Sales at the hotel, plantation, power and oil and gas businesses rose while revenue at the property unit fell, Genting said.
Casino Earnings
Profit before tax at the hotel and leisure unit climbed 19 percent to 524.6 million ringgit as the mountain casino outside Kuala Lumpur attracted more visitors. Profit at Genting's plantations division, the second-biggest earner, more than doubled to 131.3 million ringgit after the price of palm oil surged.
Genting's assets include Kuala Lumpur-listed Resorts World Bhd., operator of the Malaysian casino, and Singapore-listed Genting International Plc, owner of a license to build the city- state's second gaming resort.
Genting has said revenue from its S$5.2 billion ($3.6 billion) Singapore venture will make it the world's third-largest casino operator in a decade. The resort is due to open in 2010.
Updated : 22-11-2007
Media : Bloomberg
Story By : Angus Whitley
(Adds analyst's comment in fourth paragraph.)
Nov. 22 (Bloomberg) -- Genting Bhd., Asia's largest listed casino operator, said third-quarter profit fell after higher U.K. gaming tax led to a writedown at the company's British unit.
Net income dropped 34 percent to 275.2 million ringgit ($81 million), or 7.45 sen a share, from 418.7 million ringgit, or 11.87 sen, a year earlier, Genting said in a release today. The company proposed a dividend of 30 sen a share, or 807 million ringgit, in memory of founder Lim Goh Tong, who died last month.
A 937.8 million-ringgit impairment charge, mostly at Genting's U.K. betting chain, offset higher income at the Malaysian casino unit and power division. The British government unexpectedly raised gaming taxes in April and a July smoking ban deterred gamblers. That triggered the writedown and hindered Genting's international expansion plans, some analysts said.
``The main reason people buy Genting shares is for the expansion overseas,'' said Hoe Lee Leng, an analyst at RHB Research Institute Sdn., who rates the stock as ``outperform''. The scale of expansion that investors expected ``hasn't materialized yet.'' Investors should buy Genting shares, she said.
Genting has climbed 14 percent this year, trailing the 23 percent gain on the benchmark Kuala Lumpur Composite Index. The stock, which reached 9.25 ringgit in April, closed at 7.5 ringgit today. The company reported earnings after close of trading today.
Group revenue surged 40 percent to 2.22 billion ringgit. Sales at the hotel, plantation, power and oil and gas businesses rose while revenue at the property unit fell, Genting said.
Casino Earnings
Profit before tax at the hotel and leisure unit climbed 19 percent to 524.6 million ringgit as the mountain casino outside Kuala Lumpur attracted more visitors. Profit at Genting's plantations division, the second-biggest earner, more than doubled to 131.3 million ringgit after the price of palm oil surged.
Genting's assets include Kuala Lumpur-listed Resorts World Bhd., operator of the Malaysian casino, and Singapore-listed Genting International Plc, owner of a license to build the city- state's second gaming resort.
Genting has said revenue from its S$5.2 billion ($3.6 billion) Singapore venture will make it the world's third-largest casino operator in a decade. The resort is due to open in 2010.
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