Genting Singapore (GS) posted a pretty decent set of 4Q10 results last evening, with revenue up 6% QoQ at S$788.5m. Although reported net profit fell 51.2% QoQ to S$91.7m, but excluding several one-off non-cash items, core net profit was closer to S$153.3m, though still down 15.8% QoQ. For the full year, GS posted revenue of S$2753.3m, which came just about 2.7% shy of our full-year forecast, while reported net profit came in around S$657.2m; we estimate that core earnings would have come in around S$795.7m, or 10.2% below forecast. Going forward, GS believes that it will continue to do well in the Year of the Rabbit, with strong visitorship in both VIP and mass segments, as it continues to add attractions to its IR to reinforce its attractiveness to Asian visitors. In view of the higher-than-expected VIP business that RWS has managed to secure, we see the need to adjust our margin assumptions lower; this in turn reduces our FY11 core earnings estimate by 15.8% even as we raise our revenue forecast by 4.0%. But as we are maintaining our cashflow assumptions, our DCF-based fair value remains unchanged at S$2.53. Maintain BUY.
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