Period     1Q13 for Genting Singapore Plc. (GENS)

Actual vs. Expectations    GENS’ 1Q13 results came in below expectations with the adjusted EBITDA of SGD249.7m accounting for 19% of our full-year estimate and 17% that of the market consensus.

The 1Q13 PAT of SGD145.4m accounted for 22% of the street’s full-year forecast.

Dividends     No dividend was declared during the quarter.

Key Results Highlights     Despite rolling chip volume hitting a record high at c.SGD16.8b, surged 38% YoY, the 1Q13 PAT of SGD145.4m contracted by 31% from a year ago. This was largely due to a weaker luck factor as its rolling chip-win percentage dropped to 2.1% from 3.4% previously. As such, the 1Q13 top line fell 15% YoY.

Sequentially, the 1Q13 PAT dropped 10% from that of SGD162.2m in the preceding quarter as revenue declined 15% over the quarter. This was attributable to the better luck factor in 1Q12 as the win percentage for the premium segment was 3.0%.

In 1Q13, the clientele mix between VIP and non-VIP was at a ratio of 49:51. Market share for the rolling chip volume between RWS and MBS was 48:52 while it was 47:53 for the market share of non-rolling chip drop.

The daily average visit number to the newly launched Marine Life Park was 7,400 in 1Q13 from 7,100 in 4Q12 while Universal Studios Singapore reported a lower average daily visitation at 8,400 (flat YoY) from 11,100 in 4Q12.

The hotel occupancy rate improved to 92% in 1Q13 from 91% in 4Q12 and 86% in 1Q12. However, the average hotel room rate fell to SGD404 in 1Q13 from SGD447 in 4Q12, but it was SGD338 in 1Q12.

Outlook     Unlike three months ago, where the management was optimistic about its prospects, it now has a cautious outlook for 2Q13 given the uncertain GE13 outcome and the mix economic outlook regionally.

Change to Forecasts     No changes to our GENTING’s FY13-FY14 EBITDA estimates for GENS.

Rating      NOT RATED for GENS, MARKET PERFORM for GENTING.

Valuation      We are keeping our TP on GENTING unchanged at RM10.22/share, based on a 20% discount to its SOP, ahead of the release of its 1Q13 results by the end of this month.

Risks     The risks to GENS include a weaker than expected business volume and a poorer luck factor.

Source: Kenanga