Its Q2 net profit plunged 89% due primarily to surging costs as its New York resort commenced full casino operations.
The casino and resort operator’s net profit for the quarter ended June 30 (Q2 FY2026) fell to RM47.4 million from RM416.6 million a year ago, the group said in an exchange filing yesterday.
The earnings decline was partly attributed to costs associated with the commencement and ramp up of Resorts World New York City’s (RWNYC) full commercial casino operations, higher depreciation and higher financing costs for the development of the integrated resort.
The earnings drop was also due to an RM18.1 million unrealised forex translation loss on its US dollar-denominated borrowings during the quarter compared with a RM184.6 million translation gain a year earlier.
However, GENM’s Q2 revenue jumped 32% to RM3.85 billion from RM2.92 billion a year earlier, mainly due to contributions from the commencement of commercial casino operations at RWNYC.
The New York resort launched its full casino operations with 242 table games and 2,500 slot machines in April, with another 1,400 slot machines added subsequently.
For the first half of FY2026, net profit plunged 91% to RM43.6 million from RM489.3 million while revenue rose 22% to RM6.72 billion from RM5.51 billion.
In a note today, Public Investment Bank (PublicInvest) said GENM’s topline was lifted by contributions from RWNYC but its bottomline was dragged down by higher costs.
“While we had anticipated the new casino operations in New York to incur higher operating costs at the initial stage, the scale of losses came in larger than expected.
“Despite our projection of an improving earnings trajectory, visibility remains weak at this juncture given the uncertainty surrounding the health of the US economy,” it said.
PublicInvest said while the New York casino expansion may be seen as a catalyst, it is not likely to be earnings accretive in the next one to two years given its hefty project cost of US$5.5 billion (RM22.2 billion).
The bank cut its FY2026-2028F earnings forecasts by an average of 11%, and kept its “hold” call while lowering its target price to RM1.88 from RM2.14 previously.
TA Research noted that GENM’s US operations chalked up a 120.9% growth in revenue to RM1.5 billion in Q2, thanks to the commercialisation of casino operations at RWNYC.
This means that the US business is catching up to the RM1.8 billion quarterly revenue contribution from the Malaysia operations, it added.
The research house upgraded its recommendation to “hold” from “sell” after the stock’s recent correction, with a target price of RM1.82 per share.
GENM closed one sen or 0.6% lower at RM1.72, giving it a market capitalisation of RM10.21 billion. The stock has fallen 16% year to date.
Lim Kok Thay – the son of Genting founder Lim Goh Tong – and his son Keong Hui, have a deemed interest of 73.85% in GENM as at March 16, 2026, according to its 2025 annual report. - FMT
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