GEN Sing cash flow to cover expenditure and dividend

Through December 2024, Genting Singapore Ltd., the company in charge of running Singapore’s Resorts World Sentosa casino complex, is expected to produce an operational cash flow of SGD 1.4 billion (about USD 1.0 billion), according to Moody’s Investors Service.

This sum, together with the company’s cash position of SGD 3.4 billion, is anticipated to cover modest debt payments, forecast capital expenditures of SGD 1.0 billion, and predicted dividend payouts of SGD 0.6 billion.

With a cash balance of SGD 3.4 billion and lease obligations of just SGD 3 million as of June 30, Genting Singapore has a solid net cash position. The entire ownership of Resorts World at Sentosa Pte Ltd., which manages Resorts World Sentosa, and the assumption that Genting Singapore would continue to have complete access to the resort’s cash flow are reflected in Moody’s A3 issuer rating for Genting Singapore.

The Resorts World Sentosa “RWS 2.0” phased expansion is expected to cost Genting Singapore SGD 4.5 billion. According to Moody’s, the business has enough liquid assets to finance the growth without taking on further debt. Around SGD 320 million in capital expenditures are anticipated in 2023 and SGD 800 million in 2024, with certain expansion project components awaiting government permits and possibly starting in 2024.

As a result of the firm gaining from the continuous recovery in Singapore’s tourist industry, Moody’s forecasts that Genting Singapore’s profits before interest, taxes, depreciation, and amortisation (EBITDA) would rise to around SGD 1.1 billion in 2023 and 2024 from roughly SGD 840 million in 2022. Between January and August 2023, Singapore welcomed 9.01 million tourists, a growth of 204.5 percent annually.

However, owing to high energy and labour expenses as well as increasing casino tax rates from March 2022, Moody’s does not foresee Genting Singapore’s profits to recover to 2019 levels over the course of the next 12 to 18 months.

Original story by: GGRAsia