PETALING JAYA: Fitch Ratings has downgraded the long-term issuer default rating (IDR) of Genting Bhd
to 'BBB-' from 'BBB', and the IDRs of Genting Overseas Holdings Ltd (GOHL) to 'BBB-' from 'BBB' and Resort World Las Vegas LLC (RWLV) to 'BB+' from 'BBB-'.
In a statement, Fitch said the outlooks are stable.
“The downgrades reflect our expectation that Genting's proportionately consolidated earnings before interest, taxes, depreciation and amortisation (ebitda) net leverage ratio will stay above 4-times for the next three years.
“We expect the pace of deleveraging to be slow due to substantial capital expenditure (capex) to expand key properties, including those in Singapore and New York.”
Fitch said this is compounded by a slower-than-expected ebitda ramp-up at Genting New York LLC because of high start-up operating costs, as well as a more gradual recovery across Genting’s other gaming operations.
“GOHL's IDR is equalised with that of Genting, while RWLV is rated one notch lower. GOHL and RWLV are wholly-owned by Genting.”
Fitch said it expects Genting New York’s capex to remain high at an average of around US$800mil per year over the medium term, following the award of the New York licence.
“Of the remaining US$4.4bil pledged for the expansion, about US$700mil has been spent to date, including US$500mil for the licence fee.
“The remaining US$3.7bil will be deployed over the next five years, and will put pressure on Genting New York's credit metrics during the construction period.”
Fitch added that Genting Singapore Ltd is also rolling out its Resort World Sentosa 2.0 expansion with remaining committed capex of about S$4bil until 2030, which would result in negative free cash flow during the expansion phase.
Fitch said it expects Genting New York’s ebitda to increase to US$208mil in 2026 as the casino ramps up.
“This is slightly lower than our previous expectation of US$215mil due to high start-up operating costs.
“Our forecast assumes that by 2028, ebitda from Genting New York will reach around US$450mil as more tables and slot machines are added, while the ebitda margin improves as costs normalise.”
Fitch added that the casino has first-mover advantage in New York and benefits from a dense population and high income flows.
“We forecast flat gaming revenue for Genting Singapore Ltd in 2026 as it continues to renovate its hotels and casino areas to enhance its customer experience.
“We expect muted revenue growth for the Malaysian properties, amid high travel costs and macroeconomic uncertainties. We estimate RWLV's 2026 ebitda to increase to about US$160mil, supported by the newly expanded Las Vegas Convention Center, which opened in early 2026.”
