Monday, June 13, 2011

Genting Hong Kong Time to emerge from the shadows (KE)

KUALA LUMPUR: Genting Hong Kong Ltd, formerly known as Star Cruises Ltd, is raising bonds worth about 1.28 billion yuan (RM600.18mil) for general corporate purposes, said a source in its associate company.

The bonds are three-year bonds with a yield of 3.95%. It was reported that Genting Hong Kong had hired CIMB Group Holdings Bhd, HSBC Holdings Plc, Malayan Banking Bhd and UBS AG to help with the sale of three-year, yuan-denominated bonds in Hong Kong.

Genting Malaysia Bhd owns an 18% stake in Genting Hong Kong. Apart from owning Star Cruises, Genting Hong Kong is a co-owner of Resorts World Manila and also has a 50% stake in Norwegian Cruise Lines (NCL).

Star Cruises together with NCL is the third largest cruise operator in the world, with a combined fleet of 18 ships cruising to over 200 destinations, offering about 35,000 lower berths. Resorts World Manila is Genting Hong Kong’s first foray in a land-based attraction. – By Tee Lin Say

Growth will primarily be driven by better performance in its property unit and entertainment complex.

“The full-year target is we want to double what we did last year. Last year was P3.2 billion [and] this year is P6.4 billion,” Alliance Global President Kingson U. Sian told reporters after the company’s stockholders’ meeting in Quezon City.

For gaming, Mr. Sian said increased earnings are expected in “all segments like local VIPs and mass market.”

In terms of revenues, 60% will come from local gamers but moving forward, the company wants to tap more Chinese and Korean gamers to increase the contribution of foreigners.

Travellers International Hotel Group., Inc., which owns the eight-hectare Resorts World Manila complex in Pasay, is equally co-owned by Genting Hong Kong, the third-largest cruise line operator in the world and local conglomerate Alliance Global. Last year, Resorts World Manila opened the Genting Club and the Newport Arts Theatre.

For the property sector, Mr. Sian said Megaworld Corp. will drive the growth as it expects profits to breach the P6-billion mark.

The projection shows an 18% growth in net income compared with P5.085 billion last year.

Megaworld, one of the top higher-end condominium developers, has seven ongoing projects within Metro Manila and several residential developments within the Makati Central Business District and San Juan.

Profits of Alliance Global -- whose other units are Emperador, Generoso and The Bar producer Emperador Distillers, Inc. and Golden Arches Development Corp., the master franchise holder of McDonald’s in the Philippines -- surged by 28% to P2.85 billion in the first quarter from last year.

Furthermore, new developments are under way in the 25-hectare Newport City tourism, hotel and gaming development in Pasay City. A new hotel is expected to be built in the entertainment complex.

Mr. Sian said the company expects to seal an operating and branding agreement this year for a new five-star hotel.

Alliance Global now has the 342-room Marriott and six-star luxury hotel Maxims in Newport City. It is also building budget hotel Remington and the 540-room luxury Hamilton Hotel in Newport City.

“For hotels, eventually we will have close to 2,500 rooms,” Mr. Sian said, adding that the company will reach about 1,500 rooms with the opening of the 712-room Remington in October.

A new grand ballroom and an amusement center will add to the amenities at the hotel and casino complex. “We are now building a convention center and ballroom at Newport,” Mr. Sian said.

The company allotted 1.2 hectares for the grand ballroom, which is targeted to be the biggest in the country. Its commercial operations will start in 2014.

“Foot traffic is 15,000 per day by this year. We might even hit 25,000 or 30,000 because of the ballroom and convention center,” Mr. Sian said.

To date, there are still four hectares in Newport City that can be developed by Alliance Global.

Mr. Sian said Alliance Global will also put up a new amusement center on top of the Newport Mall.

“There are enough reasons for the investors to believe [the profit target],” Claire S. Quiray, analyst at Regina Capital Development Corp., said in a phone interview yesterday. “You can see by the influx of clients and customers in Resorts World,” she added.

Shares in Alliance Global, which has a market value of P103.73 billion, rallied by 2.38% or 24 centavos to close at P10.34 apiece on Friday.