Credit ratings agency Fitch has given a stable outlook to the gaming industry in Singapore and Malaysia, despite declining visitor arrivals and lower win rates.
Genting Malaysia, Genting Singapore and Marina Bay Sands (MBS) notched up a robust Ebitda - a measure of profit before tax, interest and other items - of over 30 per cent, the agency said on Sunday. VIPs form the largest group of patrons of the two resorts in Singapore while Genting Malaysia focuses on mid-market consumers.
"Credit extended directly to the VIP patrons has translated to the robust Ebitda margins for Singapore resorts," the agency noted.
It also pointed out that Genting Singapore and Genting Malaysia are in a net cash position while MBS has been deleveraging.
The anti-corruption crackdown in China is hurting Singapore's gross gaming revenues, especially in the VIP segment, Fitch said.
Revenue may have been stable in the six quarters ended June 30 this year, but the Singapore resorts may not be able to ride the sluggishness if it continues for another 12 to 18 months, the agency said.
Genting, which has majority stakes in Genting Singapore and Genting Malaysia, has expansion plans of US$1.91 billion (S$2.7 billion) this year and next, Fitch said.
"Genting executing its plans, while maintaining its low leverage and managing its receivables efficiently, is key to maintaining its credit profile," the agency said.