Casino cruise ship operator and Asian land casino investor Genting Hong Kong Ltd Genting said it was moving to a new stage of cost-cutting to limit expected losses in the first six months of 2020 due to the negative impact of the COVID-19 virus. The company announced Friday that its top management had "100% waived fees and compensation from February 2020 to the end of this year".
Executives affected by the decision include the company's chairman and chief executive officer, vice chairman, deputy chief executive, directors and group presidents, the company said in a filing with the Hong Kong Stock Exchange on Friday.
Genting Hong Kong confirmed to GGRAsia in February that Genting Cruise Line, one of its divisions, was cutting salaries for senior employees by 20% to 50% due to the negative impact of the novel coronavirus on its business. Genting Cruise Line operates three distinct ship-based holiday brands: Star Cruise, Dream Cruise and Crystal Cruise.
In a filing on Friday, Genting Hong Kong said about 90% of the group's managers "supported the plan," contributing to a "saving of $15 million, or about 16% of annual coastal salaries and wages."
The company said it would implement additional cost-cutting measures. They included cutting crew on board by not renewing contracts that expire, cutting staff on board by not replacing employees leaving without filling vacancies, all costs to avoid the possibility of contracting the virus, especially reducing travel costs and voluntary unpaid leave.
Genting Hong Kong said it expected its net loss for the six months ending June 30 to be "much higher" than in the same period in 2019. The expected increase in such net loss was "due to widespread travel warnings [government warnings] and temporary closures of cruise ports due to the COVID-19 outbreak," the company said.
The company said in February that its cruise business environment in 2020 will "continue to be challenging" due to the COVID-19 pandemic. The group has canceled several of its scheduled voyages across three cruise brands since late January. Some cruise ships are expected to resume operations in April, it said.
"The magnitude of the impact on the group's performance due to the rapid spread and development related to the COVID-19 outbreak is difficult to gauge," Genting Hong Kong said in a recent filing.
Many investment analysts covering the cruise business said they expected a sharp decline in new bookings in 2020 and an increase in cancellations before a partial recovery in 2021.
Genting Hong Kong expects a net loss in the range of US$140 million to US$170 million for the year ended December 31, 2019, compared with a consolidated net loss of US$224 million a year earlier.
BY: 릴게임