Genting Singapore's Share Price Plunged 23% in a Year: Can the IR Operator Regain Its Mojo?

The Straits Times Index (SGX: ^STI) pulled off a remarkable performance last year.The bellwether blue-chip index recorded a total return (inclusive of dividends) of 23.5% in 2024.However, not all index components benefitted from this surge.Genting Singapore (SGX: G13), in particular, has suffered a steady share price decline.Shares of the integrated resort (IR) operator have plunged 23% in one year, hitting their 52-week low of S$0.70 just recently.Can the IR operator see better days ahead? Let’s find out.

A downbeat set of earnings

Genting Singapore reported a mixed set of earnings for 2024.Although revenue rose 5% year on year to S$2.5 billion, gross profit fell by 5% year on year to S$836.1 million.An increase in administrative and selling expenses led to net profit declining by 5% year on year to S$578.9 million.The IR operator also generated a lower operating cash flow of S$859.7 million for 2024 compared with S$958.5 million in 2023.Free cash flow came in at S$437 million, 30% lower than the S$630.9 million churned out a year ago.A final dividend of S$0.02 was proposed, unchanged from the previous year.In particular, investors were spooked by Genting Singapore’s second half of 2024 (2H 2024) results.Total revenue fell by 12% year on year while net profit tumbled 34% year on year to S$222 million.

Visitor arrivals have yet to surpass 2019

Another problem facing the group is visitor numbers.The Singapore Tourism Board (STB) recently released its 2024 visitor numbers and 2025 projections.2024 saw Singapore attract 16.5 million visitors, which is at the top end of STB’s 2024 forecast, while tourism receipts are set to reach new highs.For 2025, STB forecasts visitor numbers increasing to 18.5 million.While this may seem like an improvement, it still does not surpass the pre-pandemic high of 19.1 million back in 2019.The strong Singapore dollar isn’t helping, as visitors from Indonesia, Thailand, and Vietnam become more price-sensitive.For India and China, visitor numbers were 13% and 3% below 2019 numbers, respectively, for 2024.With Malaysia and Indonesia being the largest source markets for Singapore tourism after China and India, the strong Singapore dollar and the lack of a meaningful recovery are big concerns.With visitor numbers still lagging behind 2019, Genting Singapore may have to contend with lower visits to its attractions.