RWS further benefits from business diversification (greater non-gaming revenue share) and a broad geographical reach of its visitor base — factors that underpin its typically higher EBITDA margins.
However, macroeconomic uncertainties may dampen the uplift expected in 2HFY2025 from post-renovation launches.
“We believe 2HFY2025 could see y-o-y improvement, supported by the debut of the Laurus luxury hotel, the reimagined The Weave retail experience, and the opening of the Oceanarium,” say analysts Chee Zheng Feng and Jason Sum.
The analysts believe any uplift could be subdued given escalating macroeconomic risks and uncertainties – particularly high US tariffs set to take effect from Aug 1. Notably, US tariffs on exports from Southeast Asia range from 25% in Malaysia to 36% in Thailand as of time of writing.
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With uncertainties looming, the analysts have cut GENS’ FY2025/FY2026 adjusted EBITDA by 2%/3% on softer gaming revenue, as regional macro conditions continue to weigh on inbound tourism.
RWS’s core clientele, comprising mainly regional tourists, are likely to be disproportionately affected by economic pressures and more cautious with discretionary gaming spend compared to their Western counterparts. “As these macro uncertainties are expected to persist into FY2026, we have accordingly revised down our earnings forecasts,” adds Chee and Sum.
As at 10.30am, shares in GENS are trading at 74 cents.
