Towards Financial Freedom
Genting Singapore - Implications of MBS' 3QFY13 results HOLD
- Las Vegas Sands Corporation (LVS) announced its 3QFY13 results yesterday. The group's results beat market expectations on the back of strong contribution from Sands Cotai Central in Macau.
- LVS' subsidiary, Marina Bay Sands (MBS) reported a 6.4% QoQ increase in casino revenue in 3QFY13 underpinned by an improvement in the win percentage of the VIP business.
- In its conference call, LVS said that it is difficult to predict when the casino legislation in Japan would take place. Although it was reported in the Press that the first phase of the legislation would be passed by December, LVS is unsure.
- Also, management said that Japan would be the most expensive investment that LVS would undertake if they were to win any casino bid. It would cost more than US$6bil to build a casino in Tokyo.
- Win percentage of the VIP segment in MBS inched up from 2.53% in 2QFY13 to 2.85% in 3QFY13. The theoretical win percentage is about 3.05%. As a result, MBS' casino revenue rose 6.4% from US$590.3mil in 2QFY13 to US$628.1mil in 3QFY13.
- Volume of business was weak in 3QFY13. Volume of VIP business declined by 4.1% from US$14.4bil in 2QFY13 to US$13.8bil in 3QFY13.
- Mass market and slot volumes were stagnant QoQ in 3QFY13. Volume of mass market business mounted to US$2.76bil in 3QFY13.
- LVS said that their focus in Singapore has migrated to foreign visitors. The group would be allocating more rooms for the premium mass customers in MBS.
- MBS' weak volume of business is not a positive follow-through for Genting Singapore (GenS). In spite of this, we reckon that GenS' share price would be supported by the casino developments in Japan. GenS is scheduled to release its 3QFY13 results before 15 November 2013.
Source: AmeSecurities
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CS Tan
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
haikeyila
this is a report on MBS. Don;t see the correlation here with GenS. Are both of them bidding in Japan?
2013-10-18 17:12