Singapore Integrated Resorts
GENTING International, which is building the Resorts World at Sentosa (RWS), is to invest another $590 million in the integrated resort which is due to open in early 2010.
Genting said the extra investments were required because of further changes made last year aimed at increasing the appeal of the IR project. -- ST PHOTO: JOYCE FANGThe extra funds to be pumped in by the company, which is part of Malaysian gaming conglomerate Genting Berhad, will bring its total investment in RWS to $6.59 billion, up from $6 billion, it said in a statement to the Singapore Exchange on Thursday.
Genting said the extra investments were required because of further changes made last year aimed at increasing the appeal of the IR project.
'In the course of the past year, changes have been made to the design and architecture of the integrated resort to substantially improve its entertainment and fun offerings, including enhancements to its casino and Universal Studios Singapore,' said Genting.
'Improvements were made to the quality of interiors as well as foot traffic accessibility to retail and dining outlets.'
The group, which managed to narrow its full-year losses, said it will be incurring substantial costs on the Sentosa IR, and this is expected to have a 'significant impact'on its earnings this financial year.
Capital expenditure before the resort's opening is projected to be less than $6 billion, and hence, the additional investments will be funded by operating cash flows from the IR when it opens.
The group also assured investors that financing for the IR 'is in place', after obtaining a $4 billion credit facility in April last year.
To prepare for the IR's opening in 2010, the group 'will be incurring significant pre-opening costs as it accelerates its human resource recruitment, training and sales and marketing programmes for the integrated resort', it added.
As at the end of last year, RWS has awarded and committed more than $4.5 billion of the $6.59 billion project costs.
The resort will feature four hotels, a 7,300-seat ballroom, as well as the first Universal Studios in South-east Asia.
Genting, also the largest casino operator, reported a full-year net loss of $124.8 million, 67 per cent lower than the $381.45 million of losses chalked up in 2007.
Revenue slipped 14 per cent to $643.8 million, down from $751.65 million in 2007, mainly due to lower revenue from the group's casino operations in Britain on the back of a weakening pound against the Singapore dollar.
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GENTING International on Thursday said its full year net loss narrowed to $124.8 million from $381.4 million but warned that it will be incurring substantial costs for the casino, the Resorts World at Sentosa (RWS).
It also conceded that the development is expected to have a 'significant impact' on earnings this financial year.
The group assured investors on Thursday that financing for the IR 'is in place' after it obtained a $4 billion credit facility last April.
Genting, which is also the largest casino operator in Britain, saw its revenue fell 14 per cent to $643.8.
The firm took a hit from its casino operations in Britain, where a slowing economy and a weakening pound against the Singapore dollar took their toll.
The group also experienced lower business volumes due to the global economic slowdown.
The slowdown is likely to have a material impact on disposable income, which will adversely affect its UK operations, it said.
The group absorbed $100.8 million in impairment losses on intangible assets, mainly due to the general economic slowdown in the UK and rest of the world.
Key expenses were also up, with administrative expenses rising 22 per cent to $42.5 million.
Other operating expenses more than doubled from $15.2 million to $32.7 million.
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