Genting Singapore’s 9M11 Earnings Jump 4-Fold To $758.3m
Genting Singapore (GS) posted a 4-fold jump in 9M11 earnings, mainly attributed to the full nine months operations of Singapore IR as well as the one-off gain on disposal of available-for-sale financial assets of $45.6m in 2011. RBS said in a report that GS’s net profit of $209m was 10% lower than its estimate, mainly due to a significant quarter-on-quarter increase in bad-debt provisions related to the company’s VIP business. On the other hand, HSBC believes GS remains well-positioned to secure new gaming opportunities when they arise. CLSA Asia-Pacific Markets also noted that GS, Las Vegas Sands and Wynn are the three front-runners for one of the two licences which would probably be operated under a joint venture with a Japanese company.
Significance: In the next few months, the outcome of GS’s junket licensing applications would be in focus. In addition, analysts also expect GS’s VIP segment to regain market share through the opening of Equarius hotel (200-luxury room) and Beach Villas (20-plus) by year-end.
Banyan Tree Posts 3Q11 Loss Of $2.9m
Banyan Tree Holdings posted a net loss of $2.9m for the third quarter ended 30 Sep-11. 3Q11 turnover also dropped 3% to $66.2m attributable mainly to lower revenue from its hotel investments and fee-based segments by $4.6m and $3m respectively. Lower revenue from its hotel investments segment in the third quarter was mainly from Thailand ($7.3m) – due to the closure of Angsana Laguna Phuket for renovation since July this year – but partially offset by China ($1.3m) and Maldives ($0.6m). Given the increased deterioration of the global financial situation brought on by economic woes in the US and Europe, the firm is of the view that travel industry will be likely affected as people become increasingly cost-conscious.
Significance: The recent flood in Thailand has significantly affected Banyan Tree’s business, whereby a total of 3,166 room nights (US$541k), which is equivalent to 5% of forward bookings, has been cancelled as at 31 Oct-11. Subsequently, 4Q11 and FY11 performance are expected to post lower result.
Sheng Siong’s 3Q11 Bottomline Falls 51% To $6.6m
Sheng Siong’s 3Q11 earnings fell 50.9% to$6.6m in tandem with a 9.3% drop in revenue to $146.2m, mainly due to the absence of non-recurring other income as well as initial public offering expenses incurred in the current period. ‘We will continue to focus on revenue and margin expansion to drive growth. We target to open more stores to boost the top-line,’ said Lim Hock Chee, chief executive officer of Sheng Siong. Sheng Siong has so far opened two new outlets in the first half of this year, and is scheduled to open another two in Woodlands Industrial Park and Thomson Imperial Court by the end of 2011.
Significance: Singapore retail industry is expected to remain competitive amid the economic uncertainty. Notably, Shop N Save, Sheng Siong’s competitor, planned to open 10 more outlets by the end of this year.