Genting Singapore's net profit slips close to 31%

Lower revenue and higher depreciation expense drove decline in numbers.

Revenue also dropped by 14.7% to S$787m due to lower win percentage and lower business volume in the premium player business. However, GS noted that total casino gross revenue grew by 9% QoQ because of higher business volume in all gaming business segments. 

Here's more from OCBC Investment Research:

1Q12 results slightly under
Genting Singapore posted 1Q12 revenue of S$787m, at -14.7% YoY, meeting 21.3% of the full-year forecast. Revenue was slightly softer than expected, as overall revenue was affected by lower win percentage and lower business volume in the premium player business. But GS noted that overall casino gross revenue grew by 9% QoQ as a result of higher business volume in all gaming business segments. Net profit came in around S$211.5m at -30.9% YoY, or 20.8% of the FY estimate, affected by the lower revenue and higher depreciation expense as GS continues to expand the IR. However, this was mitigated by lower finance costs.

Near-term focus on USS
USS saw daily visitor numbers of 8.2k with an average spend of S$88, with the successful launch of the Transformers the Ride in Dec 2011. Since the break-even point is ~6-7k daily visitors, GS revealed that a number higher than that falls very quickly to the bottom line. Hence, GS will continue to focus on drawing visitors to USS. Additionally, GS is also positive on the issue of the International Marketing Agent licenses and revealed that one has started operating in the first week of May. While it does not expect to see any significant revenue boost in the near term, it is hopefully seeing more approvals over the next 12-18 months, especially for some bigger and better-funded operators.