In the second quarter of 2024, Genting Malaysia Berhad achieved a remarkable turnaround, with its profit more than doubling to MYR62.8 million (US$14.6 million). This surge was fueled by substantial revenue increases across its gaming markets in Malaysia, the US, and the UK. The company’s financial performance reflects a solid recovery and growth trajectory, underpinned by strategic investments and a resurgence in regional travel.
Financial Performance Overview
For the three months ending June 30, 2024, Genting Malaysia Berhad reported a total revenue of MYR2.67 billion (US$619 million), marking an 8% increase compared to the same period last year. This growth trajectory aligns closely with the revenue figures from the first quarter of 2024. A significant contributor to this performance was the flagship Resorts World Genting (RWG), which saw its revenue rise by 5% to MYR1.62 billion (US$376 million). This growth was attributed to increased business volumes in both the gaming and non-gaming segments of the property.
Despite the revenue growth, Adjusted EBITDA for RWG experienced a slight dip of 1% year-on-year, totaling MYR524.8 million (US$122 million). This decrease was due to higher operating expenses, which impacted overall profitability. However, the group’s Adjusted EBITDA saw a notable increase of 72% year-on-year, reaching MYR770.4 million (US$179 million). This substantial rise was partially driven by net foreign exchange translation gains.
Revenue Growth Across Markets
Genting Malaysia’s success was not confined to its Malaysian operations. The company reported impressive revenue increases in its international markets. In the UK and Egypt segment, revenue surged by 20% year-on-year to MYR468.8 million (US$109 million). The US and Bahamas segment also contributed positively, with a revenue increase of 11% to MYR527.8 million (US$123 million).
Six-Month Performance and Strategic Insights
Looking at the first half of 2024, the group reported a 14% increase in total revenues, amounting to MYR5.43 billion (US$1.26 billion). This growth was largely driven by a 15% increase in revenue from RWG, which brought in MYR3.36 billion (US$779 million). The increase in travel demand and the strategic investments made by the group played a crucial role in this positive performance.
The group maintained its Adjusted EBITDA margin at 33% for the first half of 2024, unchanged from the previous year despite rising operating expenses. This resilience underscores the company’s ability to manage costs effectively while capitalizing on growth opportunities.
Market Reactions and Analyst Perspectives
Analysts from Nomura, Tushar Mohata and Alpa Aggarwal, expressed a positive outlook on Genting Malaysia’s Q2 results. They noted that despite the seasonally weaker gaming volumes typical of Q2 and the impact of a Sales and Service Tax hike and the closure of two older casinos, the results were surprisingly strong. This reflects the company’s robust operational performance and strategic foresight.
Strategic Initiatives and Future Outlook
Genting Malaysia remains “cautiously optimistic” about the near-term prospects of the leisure and hospitality industry. The company is focused on leveraging its integrated resort offerings to capitalize on the ongoing recovery in regional travel.
Genting Malaysia Berhad’s Q2 2024 financial performance highlights a period of significant growth and strategic advancement. With a more than doubling of profits and substantial revenue increases across its global markets, the company has demonstrated resilience and effective management. Looking ahead, Genting Malaysia is well-positioned to continue its growth trajectory, supported by strategic investments, enhanced digital capabilities, and a focus on cost management. The company’s outlook reflects a balanced approach to navigating current challenges while capitalizing on emerging opportunities in the leisure and hospitality sector.