Genting Singapore estimates lowered following MBS results

Union Gaming analysts have lowered their 16Q2 estimates for Genting Singapore after reviewing 16Q2 gaming trends via Las Vegas Sands’ Marina Bay Sands results.

“We have adjusted our gaming expectations for RWS downward to reflect similar trends as MBS. Our VIP volume expectations go to -30 percent year-on-year (from -26 percent) and our mass / slots volume goes to -7 percent year-on-year (from +2 percent).

Union Gaming says it has adjusted its 16Q2 property-level EBITDA estimate to S$199 million (US$146.4 million), which is 7 percent lower than previous estimates.

On Tuesday morning, Las Vegas Sands reported VIP volume declined significantly at its Marina Bay Sands resort, with management noting that most weakness was at the highest end of the market.

MBS generated revenue of US$710.1 million in 16Q2, down 0.4 percent year-on-year. Adjusted property EBTIDA was $357 million, compared to $363.3 million in 2015.

Rolling chip volume was $6.7 billion in the second quarter, declining by 29.1 percent year-on-year.

“While gaming volumes in Singapore were softer during the quarter, solid growth in slot revenues and the continued resilience of room rates and mall revenues, contributed to an adjusted property EBITDA figure of US$357.0 million, down 1.7 percent compared to the same quarter last year,” said Las Vegas Sands in a press release.

The resort also reported a 10 percent year-on-year decline in mass table volume.

“This represented the first y/y decline in mass table GGR on a constant currency basis at MBS since 2012,” said Union Gaming. “Given that MBS generally outperforms Genting’s Resorts World Sentosa, we have to assume that RWS is likely to experience mass market softness in 2Q16 as well.”

The brokerage also notes in addition to its 16Q2 estimate revisions that it is also lowering its 2016 and 2017 EBITDA estimates to S$842 million and S$962 million respectively.