The $4.3 billion Resorts World Las Vegas facility Asian casino operator Genting Malaysia Berhad is building at the northern tip of the Las Vegas Strip will reportedly start life as a loss-making enterprise before going on to disappoint for several more years.
According to a report from Inside Asian Gaming, this is the opinion of international brokerage Nomura Securities Company Limited after its analysts predicted that the coming 3,500-room property is expected to amass aggregated first-year revenues of about $350 million alongside earnings before interest, tax, depreciation and amortization of some $82 million.
The 87-acre Resorts World Las Vegas venue is reportedly due to open during the second half of the year featuring a 110,000 sq ft casino alongside a pair of hotel towers individually marketed under the Conrad and Hilton brands. However, the source detailed that Nomura Securities Company Limited analysts Alpa Aggarwal and Tushar Mohata also forecast that the property is destined to see its second-year earnings before interest, tax, depreciation and amortization rise by only around 36% to $112 million off of revenues in the region of $477 million.
Using data from 24 nearby properties, the analysts reportedly moreover forecast that the China-themed Resorts World Las Vegas is likely to account for less than 10% of the revenues Genting Malaysia Berhad amasses in 2022. Although this figure was purportedly revised slightly upwards recently to roughly $4.87 billion, associated group-wide net profit simultaneously suffered a negative 9% correction to approximately $274.8 million.
Reportedly read a statement from Aggarwal and Mohata…
“At the net profit level, given the depreciation and interest costs, we expect Resorts World Las Vegas to remain loss-making in initial years. We assume a utilization of 70% for the 2024 fiscal year, which we believe reflects a slow build-up of tourism and MICE activities in the post-coronavirus era. We assume depreciation and interest expense for Resorts World Las Vegas also starting in fiscal year 2022.”
Being built on the site of the former Stardust Resort and Casino, Resorts World Las Vegas is moreover reportedly expected to debut complete with a selection of casual and high-class restaurants as well as an in-house spa and fitness center and some 350,000 sq ft of meeting and convention space. Construction on the property is now purportedly about 90% complete with contractors having recently begun carpeting the floors of its casino and poker room and putting the finishing touches on its retail elements.
Finally, Nomura Securities Company Limited furthermore reportedly forecast that Genting Malaysia Berhad’s net profit for 2021 will come in at about $64.2 million owing to a coronavirus-related decline in aggregated worldwide revenues to something in the region of $3.71 billion.