Genting Q2 pre-tax profit drops as hospitality business declines

Malaysian conglomerate Genting Bhd said Q2 pre-tax profit dropped 24 percent because of lower EBITDA at its leisure and hospitality businesses in Malaysia, the U.K., the U.S. and Bahamas.Profit on that basis fell to RM931.0 million ($295.5 million) from RM1,226.1 million generated in 2Q13. Revenue from continuing operations rose 2 percent to RM4.41 billion.The company said its Resorts World Sentosa property in Singapore saw higher revenue in the quarter, mainly due to a 9 percent gain in rolling volume and a higher win percentage from premium players.However in Malaysia, where the company is currently revamping its Resorts World Genting resort, revenue fell because of a lower hold percentage among premium players. EBITDA declined on lower revenue and higher payroll costs.In the U.K., there was a 41 percent decline because of a lower hold percentage and lower volumes at its London casinos, with the business swinging to an adjusted EBITDA loss in the period.Higher revenue from the leisure and hospitality business in the United States was mainly due to the commencement of operations of Resorts World Bimini in the Bahamas in June, but the segment recorded lower EBITDA as the new resort was hit by infrastructure and hotel capacity constraints. Higher payroll costs affected the U.S. business.