Lingering fears over the Batang Kali landslide may weigh on the quarter one 2023 results of Resorts World Genting (RWG). Yet, recovery accelerated from Mar 2023 onwards as almost all 10,500 rooms at RWG are now available.
Recall that the Batang Kali landslide of 16 Dec 2022 that claimed 31 lives caused quarter four 2022 RWG visitor arrivals to fall 10% quarter-on-quarter to 5.3 million, said Maybank Investment Bank Bhd (MIBB) in a recent report.
MIBB understands that rainy weather in Jan and Feb 2023 discouraged many from visiting RWG especially during the peak Chinese New Year season for fear of another landslide.
That said, their financial year 2024 and 2025 estimate core net profit, based on RWG visitor arrivals of 25.2 million/25.7million, are little changed (-3%/-4%).
MIBB states that RWG visitor arrivals accelerated from Mar 2023 onwards as the weather turned drier and all 10,500 rooms are now available thanks to sufficient labour for room upkeep. The latter is especially important as overnighters spend considerably more than day trippers. RWG gross gaming revenue is perfectly correlated to room nights sold.
Elsewhere, MIBB understands that the tender results for a downstate casino licence that will potentially allow Resorts World New York City to deploy table games and add more than RM0.53 per share to their discounted cash flow-trading price will likely be delayed to quarter one 2024 from quarter four 2023.
Las Vegas Sands flagged this during its quarter one 2023 earnings call. The request for applications process has also stalled after applicants submitted questions to the New York State Gaming Commission for clarification 3 months ago.
