Genting Singapore & Marina Bay Sands 1st Quarter 2013

Posted: May 3, 2013 in Uncategorized

Media report extracts

The Truth About Poor Performance for the two Singapore casinos

Special commentary by Professional Ground expert panel     3rd May 2013  Friday

According to media report, both Marina Bay Sands and Genting Sentosa casinos in Singapore failed to perform in 1st quarter of 2013; attributed to “good luck for VIP premium players”. This is BS…

Marina Bay Sands adjusted Evita dropped by 16% to Usd396m for the quarter. Though volume of rolling chips increased by 42% to USD18b the highest in record.
Win % for VIP rolling chip program is only at 2.51% as compared to 3.58% the year before.

As for Genting Sentosa casino, Ebitda dropped by 35% to USD249m for the quarter which is lowest record ever.
Genting did not mention the VIP rolling chip win % but Professional Ground would estimate that it is far below the 2.7% mark, could ever be in the low region of 2.2%.

Both the casinos are facing the hard-wall of trying to grow their premium business but fail. The reasons being, in our evaluation, are

–  they are not able to establish a much larger base of mass market revenue stream in order to sustain bigger profitable operation, to be more bold in funding the VIP business credit growth.

– they fail to bring in solid and real Junket operators like in Macau. Due to overly stringent casino regulatory control.

–  they just cannot sustain high credit exposure up to a point as the mini-junkets in Singapore are not able to sustain on high volume rolling chips turnover every month (with junket credit)! This is a fact.

Going forward, both the casinos’ dilemma will continue for the next few years at least. SINGAPORE tight  casino jurisdiction and players pool won’t change very much for sure. There’s no new markets available for both the mass and premium players/patrons.

Our recommendation:
Getting Singapore shares rating –  SELL

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