GENTING S: REVISED Q1 PREVIEW

Our hold assumptions were too high

Our relatively neutral thesis on Genting Singapore remains intact - only our Q1 estimates are lower.  We failed to account for a quirk in the Singapore tax receipts when estimating GGR.  The good news is that the oversight mostly impacted our hold percentage estimate.  So while our Q1 EBITDA projection is lower, investors should be adjusting for hold anyway.

Q1 Projections:

We estimate that Genting Singapore will report net revenue of S$763 million of revenue and S$381 million of EBITDA.  We’re still above consensus EBITDA of S$367 million.  Here are the revised details.

• Gaming revenue, net of commissions of S$618M
  • Gross VIP revenue of S$450MM and net revenue of S$238MM
    • We expect RC volume to increase 25% sequentially to S$15.0BN
    • Hold of 3.0%
    • Rebate of 1.3%
• Gross Mass table of S$286MM and S$236MM net of gaming points
• Gaming points equal to 3.75% of drop or S$50MM
• S$174MM of slot and EGT win
• The incremental slots/EGT expansion was installed the second week of January so the quarter should have benefited from healthy growth
• Non-gaming revenue of S$145MM
• Hotel room revenue of S$38MM
• Hotel revenues should see a sequential lift with the added capacity of the Equarius rooms
• S$25MM of F&B and other revenue
• USS revenue of S$82MM
• Gaming taxes of S$86MM
• Implied fixed costs of S$185MM compared to S$185MM/Q in 2H11