Genting Berhad’s 1Q25 Results: Navigating Headwinds with Strategic Vision
Genting Berhad, a name synonymous with leisure and hospitality across Malaysia and beyond, has just released its financial results for the first quarter ended 31 March 2025 (1Q25). While the report reveals a dip in overall group revenue and EBITDA compared to the same period last year, it also highlights strategic advancements and resilience in certain segments. Let’s dive deep into the numbers and the company’s outlook to understand what’s shaping Genting’s journey amidst a dynamic global environment.
The headline figures show a Group revenue of RM6.5 billion in 1Q25, a 12% decrease from 1Q24. Similarly, Group EBITDA stood at RM2.0 billion, 23% lower than 1Q24. However, it’s not all about year-on-year comparisons; the Group EBITDA actually improved by 19% over the previous quarter (4Q24), indicating some sequential recovery. This report offers a blend of challenges and strategic responses, making it crucial for investors to look beyond the surface.
Overall Financial Performance: A Mixed Bag
Genting Berhad’s 1Q25 performance reflects a challenging quarter, primarily impacted by its Leisure & Hospitality Division and the strengthening of the Malaysian Ringgit against major currencies like SGD, GBP, and USD. Here’s a quick overview of the key financial indicators:
1Q25 Key Figures
Group Revenue: RM6,508.0 million
Adjusted EBITDA: RM1,990.6 million
Profit Before Taxation: RM626.2 million
Profit for the Period: RM277.6 million
Basic Earnings Per Share: 0.12 sen
Compared to 1Q24
Group Revenue: RM7,431.3 million (down 12%)
Adjusted EBITDA: RM2,574.0 million (down 23%)
Profit Before Taxation: RM1,380.4 million (down 55%)
Profit for the Period: RM998.6 million (down 72%)
Basic Earnings Per Share: 15.29 sen (down 99%)
The significant drop in profit before taxation and earnings per share is a point of concern. This was largely due to lower EBITDA and higher impairment losses, although partially offset by lower depreciation and finance costs. It’s clear that while the Group’s top-line faced currency and operational pressures, internal cost management offered some mitigation.
Diving Deeper: Segmental Performance
Understanding Genting’s diverse portfolio requires a look at each business unit’s contribution:
Leisure & Hospitality Division
This division, the Group’s largest contributor, experienced a notable decline in revenue and EBITDA. Resorts World Sentosa (RWS) in Singapore saw lower VIP rolling win rates and reduced room inventory due to renovations at Hard Rock Hotel. The comparative period (1Q24) also benefited from stronger visitor numbers during Chinese New Year and relaxed visa regulations for Chinese visitors, setting a high bar.
Resorts World Genting (RWG) in Malaysia also recorded lower revenue and EBITDA due to the timing of the festive season and lower business volumes from premium players. Similarly, operations in the UK and Egypt, and the US and Bahamas, including Resorts World New York City (RWNYC) and Resorts World Las Vegas (RWLV), were impacted by the strengthening of the Malaysian Ringgit and higher operating/payroll expenses. RWLV specifically faced lower hold percentages and reduced visitation compared to 1Q24, which had benefited from the NFL Super Bowl event.
Plantation Division
A bright spot in the report, the Plantation Division’s revenue increased by 21% to RM693.4 million, and its profit for the period surged by 67% to RM243.3 million. This positive performance was mainly driven by higher palm product prices and improved sales volume in the Downstream Manufacturing segment. This segment’s resilience offers a valuable diversification for the Group.
Power Division
The Power Division also saw a significant increase in revenue (up 56% to RM259.9 million) and profit (up 78% to RM63.9 million). This was primarily due to higher generation from the Banten Plant in Indonesia, which had a shorter outage period compared to 1Q24.
Oil & Gas Division
This division experienced a dip in both revenue and EBITDA, primarily due to lower global crude oil prices in 1Q25.
Investments & Others
This segment recorded a lower adjusted loss before interest, tax, depreciation, and amortisation (LBITDA), partly due to the recognition of net unrealised foreign exchange translation gains from Genting Malaysia Berhad’s USD denominated borrowings, a reversal from losses in 1Q24.
Summary Table of Results
| Category | 1Q25 (RM’million) | 1Q24 (RM’million) | 1Q25 vs 1Q24 (%) | 4Q24 (RM’million) | 1Q25 vs 4Q24 (%) |
|---|---|---|---|---|---|
| Revenue | |||||
| Leisure & Hospitality – Malaysia | 1,620.1 | 1,746.0 | -7 | 1,776.1 | -9 |
| Leisure & Hospitality – Singapore | 2,065.8 | 2,764.7 | -25 | 2,017.5 | +2 |
| Leisure & Hospitality – UK and Egypt | 413.4 | 442.4 | -7 | 446.4 | -7 |
| Leisure & Hospitality – US and Bahamas | 1,242.2 | 1,527.7 | -19 | 1,294.5 | -4 |
| Total Leisure & Hospitality | 5,341.5 | 6,480.8 | -18 | 5,534.5 | -3 |
| Plantation – Oil Palm Plantation | 531.0 | 529.2 | – | 768.8 | -31 |
| Plantation – Downstream Manufacturing | 264.6 | 184.5 | +43 | 260.1 | +2 |
| Total Plantation (net of intra-segment) | 693.4 | 574.7 | +21 | 817.7 | -15 |
| Power | 259.9 | 166.5 | +56 | 348.7 | -25 |
| Property | 51.0 | 58.4 | -13 | 59.8 | -15 |
| Oil & Gas | 101.5 | 115.6 | -12 | 95.2 | +7 |
| Investments & Others | 60.7 | 35.3 | +72 | 25.4 | >100 |
| Total Group Revenue | 6,508.0 | 7,431.3 | -12 | 6,881.3 | -5 |
| Profit/(loss) for the period | |||||
| Leisure & Hospitality – Malaysia | 640.6 | 733.1 | -13 | 662.8 | -3 |
| Leisure & Hospitality – Singapore | 797.3 | 1,323.3 | -40 | 775.0 | +3 |
| Leisure & Hospitality – UK and Egypt | 55.5 | 73.9 | -25 | 55.2 | +1 |
| Leisure & Hospitality – US and Bahamas | 166.2 | 338.9 | -51 | 82.7 | >100 |
| Total Leisure & Hospitality | 1,659.6 | 2,469.2 | -33 | 1,575.7 | +5 |
| Plantation – Oil Palm Plantation | 237.6 | 145.2 | +64 | 275.9 | -14 |
| Plantation – Downstream Manufacturing | 5.7 | 0.9 | >100 | 0.4 | >100 |
| Total Plantation | 243.3 | 146.1 | +67 | 276.3 | -12 |
| Power | 63.9 | 35.8 | +78 | 137.4 | -53 |
| Property | 12.2 | 16.7 | -27 | 4.9 | >100 |
| Oil & Gas | 71.7 | 84.8 | -15 | 64.0 | +12 |
| Investments & Others | (60.1) | (178.6) | +66 | (379.3) | +84 |
| Adjusted EBITDA | 1,990.6 | 2,574.0 | -23 | 1,679.0 | +19 |
| Profit before taxation | 626.2 | 1,380.4 | -55 | 238.2 | >100 |
| Profit/(loss) for the period | 277.6 | 998.6 | -72 | (155.2) | >100 |
| Basic earnings/(loss) per share (sen) | 0.12 | 15.29 | -99 | (4.40) | >100 |
Risks and Prospects: Navigating the Future
Genting Berhad operates in a complex global landscape, and its future performance will hinge on its ability to manage ongoing uncertainties and capitalize on growth opportunities.
Market Outlook and Challenges
The global economic conditions are expected to remain uncertain, with ongoing international trade and market volatility. Heightened geopolitical tensions continue to weigh on sentiments, potentially slowing economic growth in Malaysia. While demand for international tourism is anticipated to remain resilient, recovery is expected to be uneven across regions, leading to increasing challenges in the regional gaming market.
Currency fluctuations also remain a significant factor, as evidenced by the impact of a stronger Malaysian Ringgit on overseas operations in 1Q25. Furthermore, the oil and gas segment faces headwinds from declining global crude oil prices.
Strategic Responses and Growth Initiatives
Despite these challenges, Genting is not standing still. The Group is actively pursuing various strategies to enhance its competitiveness and drive future growth:
- Resorts World Genting (Malaysia): Focused on enhancing its appeal as a regional tourism hub by introducing new facilities, attractions, and ecotourism experiences. The Group is also celebrating its 60th anniversary with special events to enrich visitor experience and remains committed to improving yield management, operational efficiencies, and service delivery.
- Resorts World Sentosa (Singapore): Continuing its “bold transformation journey” with high-impact projects lined up for 2025 and beyond. This includes the launch of WEAVE (a new retail and dining enclave), the grand opening of the Singapore Oceanarium, and the debut of The Laurus (Singapore’s first The Luxury Collection-branded all-suite hotel). Construction has also begun on the iconic RWS 2.0 Waterfront Complex, promising new hotels, retail, and entertainment.
- UK Operations: Expanding its presence by identifying new growth opportunities, including the recent acquisition of Aspers Stratford in London. The Group is exploring product enhancements and new offerings while maintaining disciplined cost management.
- US Operations: Solidifying its market leadership in the New York State gaming sector. The full acquisition of Empire Resorts, Inc. will enable full realization of operating synergies, cross-marketing, and resource sharing between RWNYC and Empire. For Resorts World Las Vegas (RWLV), the finalization of a complaint by the Nevada Gaming Control Board (NGCB) in March 2025 is expected to allow RWLV to recover and re-establish VIP play. RWLV is also upgrading its hotel and casino management systems to improve customer experience and drive repeat visitation.
- Plantation Division: Prospects for the rest of the year will track palm product prices and fresh fruit bunches (FFB) production. While prices have eased, they are expected to stabilize. The Group anticipates overall growth in FFB production, underpinned by mature areas in Indonesia, despite short-term moderation from replanting activities in Malaysia.
- Property Segment: Launched U.Reka in Genting Indahpura and saw a successful soft launch of Jakarta Premium Outlets, the first Premium Outlets in Indonesia.
- Power Division: The Banten plant in Indonesia is expected to maintain steady performance, and the Jangi Wind Farm anticipates favorable performance with the approaching high wind season.
- Oil & Gas Division: Maintaining a positive outlook on its Chengdaoxi Block in China, despite lower expected contributions in 2Q25 due to declining crude oil prices. Discussions are progressing for the gas sale and purchase agreement for the Kasuri block in Indonesia, with construction of the FLNG facility approximately 54% complete and project financing discussions underway.
Summary and Outlook
Genting Berhad’s 1Q25 results highlight a challenging period marked by revenue and profit declines, primarily in its core leisure and hospitality segments, exacerbated by currency fluctuations and specific market conditions. However, the performance of the Plantation and Power divisions provided some positive counterpoints, demonstrating the benefits of the Group’s diversified portfolio.
Looking ahead, Genting is not merely reacting to market conditions but actively shaping its future through significant strategic investments and operational enhancements across all its key markets. The ongoing transformation projects at Resorts World Sentosa, the expansion efforts in the UK and US, and the long-term development of its oil and gas assets underscore a commitment to sustainable growth.
While global uncertainties persist, the Group’s focus on improving customer experience, optimizing operations, and prudent cost management positions it to navigate these headwinds. The recovery of international tourism, albeit uneven, remains a key driver for its leisure and hospitality businesses, and the completion of major projects promises to enhance its offerings and market appeal.
Key risk points to monitor include:
- Continued volatility in global economic conditions and geopolitical tensions impacting tourism and consumer spending.
- Further strengthening of the Malaysian Ringgit, which could negatively affect reported earnings from overseas operations.
- Fluctuations in commodity prices, particularly palm oil and crude oil, affecting the Plantation and Oil & Gas divisions.
- The pace of recovery in VIP gaming segments and overall visitation across key resorts.
- Execution risk associated with large-scale development projects and acquisitions.
