Genting Hong Kong has announced improved results for Full Year 2017 but losses have still amounted to US$244.3 million due to start-up costs in its Dream Cruises brand and increased competition in the cruise ship market.
The company’s consolidated loss was reduced from US$504.2 million 12 months earlier, thanks largely to a one-off gain of US$205 million from the sale of shares in Australian casino operator Star Entertainment Group and in Norwegian Cruise Line Holdings Ltd.
Group-wide revenue for the year increased 17% to US$1.19 billion, including an 11.9% increase in revenue from “cruise and cruise-related activities” to US$1.02 billion. The company said that it had enjoyed a 33.7% increase in cruise ship capacity days due primarily to the inclusion of full year operations of Genting Dream and Crystal Mozart as well as the launch of World Dream, Crystal Bach and Crystal Mahler during 2017. The revenue boost was offset by a substantial increase in operating expenses from US$972.2 million in 2016 to US$1.24 billion last year.
Revenue from shipyard operations and non-cruise activities increased 60.6% to US$174.4 million in 2017 compared with US$108.6 million in 2016, primarily contributed by revenue from its shipyard activities and from sales of residential property units in Mainland China.
However, as reported by its 45%-owned casino operator Travellers International Hotel Group last week, revenue from land-based gaming operations at Resorts World Manila (RWM) fell considerably in 2017 as a result of the devastating arson attack in June that saw 38 people lose their lives and the casino closed for a month. Revenue from RWM declined 27.6% to Php17.115 billion (US$327.9 million).
Despite the heavy losses, Genting HK said it was confident that its primary focus on cruise ships would pay dividends.
“Asia is the world’s largest and fastest growing outbound market, in particular Chinese outbound tourists,” it said. “About a billion people in Asia will reach middle-class status by 2030 and they have the disposable income to travel and cruise.”
Genting HK said that it was aiming for its Dream Cruises brand to become “Asia’s Global Cruise Line”, offering not only cruises in Asia but in other global regions such as Australia, Europe and the United States.
It also pointed to the impending launch of RWM Phase 3 later this year, which will see three new hotels – Sheraton Manila Hotel, Hilton Manila and Hotel Okura Manila – open for business, effectively making RWM a six-hotel integrated resort.
“Upon completion of all three, RWM’s room count will increase to 2,390 – the biggest among all the integrated resorts in the Philippines,” it said. “The Westside City Resorts World, a 31-hectare property situated in PAGCOR’s Entertainment City, is planned for 2021 with about 1,000 hotel rooms operated under selected international hotel brands.”
