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Analysts lower Genting Singapore’s estimated fiscal year figures

Nomura Research analysts have lowered the estimated 2021 earnings for Genting Singapore, in the wake of renewed Covid-19 cases in the country.

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Analysts reduced predicted adjusted EBITDA for 2021 by 15% to SG$530m ($400.2m), while the same 15% reduction was placed on the 2022 prediction.

The lower figures were impacted by the group’s financial results for Q1 2021. Genting Malaysia’s revenue prediction was lowered by 17% for 2021 and 10% for 2022. The analysts stated they “do not build in any additional value” from Genting’s plans to win Japan’s IR licence in Yokohama.

Nomura's analysts believe Singapore’s international tourism likely won’t see an extensive recovery in 2021, mainly due to slow vaccination in Asia, and the reintroduction of social distancing and travel restriction measures as the number of cases increases.

Genting’s yearly performance will likely be impacted by Genting Malaysia’s temporary casino shutdown, with no date set for reopening. Nomura predicts the group’s UK and US businesses might see greater recovery than the Asian branch, reports Asia Gaming Brief.

Despite the setback in revenue and the adjusted estimations, positivity remains about Genting’s overall performance. “We believe equity investors will likely overlook near-term bumpy earnings, and are looking through to FY22F/23F prospects, which look robust,” said Nomura.

And when it comes to paying dividends, the analysts added: “Genting Singapore has the balance sheet to support a higher payout given the slow progress in Singapore capital expenditure.

“We believe Genting Singapore will be one of the better tourism recovery stories due to its balance sheet strength and the relatively better control of Covid-19 in Singapore, along with the fast pace of vaccination.”

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