S&P Global Ratings expects Hong Kong-listed casino operator NagaCorp Ltd’s earnings to grow “modestly” over the next two years, at an annual rate of 5 percent to 6 percent across 2026 and 2027.
“A return to the level of earnings in 2019 is unlikely for the time being,” the institution cautioned in a ratings action issued on Thursday.
NagaCorp has a long-life casino monopoly in the Cambodian capital Phnom Penh, where it runs the NagaWorld casino resort (pictured).
The rating agency raised its long-term issuer credit rating on NagaCorp to ‘B+’ from ‘B’, still below investment grade, citing what it described as a “stronger credit profile”. It assigned a ‘stable’ outlook on Nagacorp’s rating.
Last month, Moody’s Ratings upgraded the corporate family rating of NagaCorp to ‘B2’ from ‘B3’, while maintaining a ‘stable’ outlook.
S&P analysts Johann Tan, Isabel Goh and Shawn Park wrote in Thursday’s memo that, despite a “notable turnaround” in 2025, operations at NagaCorp still lagged pre-pandemic levels, with a full recovery “likely to be protracted”.
In March, NagaCorp reported full-year 2025 net profit of US$309.9 million, up more than 180 percent from 2024. The firm’s earnings before interest, taxation, depreciation, and amortisation (EBITDA) stood at US$404.4 million last year, compared with US$202.8 million in 2024.
By comparison, its reported EBITDA in 2019 was around US$667 million, supported by the referral VIP segment – primarily junkets – which contributed around 70 percent of gross gaming revenue (GGR), the S&P team said. “This segment is unlikely to return and will weigh on the company’s business strength,” it added.
NagaCorp reported in April GGR of nearly US$174.7 million for the first three months of 2026, up 2.1 percent year-on-year. The growth was supported by mass play, although revenue from its VIP segments declined, it noted.
The company had a cash balance of about US$372 million as of end-2025 and only a US$70 million shareholder loan outstanding, due this month, according to S&P.
“NagaCorp’s net cash position and the absence of debt obligations upon repayment of its shareholder loan provide a financial cushion that underpins its credit profile,” the rating house said.
It added: “The company has built a healthy balance sheet anchored by low leverage and a sizeable cash balance. NagaCorp has managed its cash flow by limiting dividends and capital expenditures (capex) since 2022, while keeping its leverage low.”
S&P, however, noted that its current rating level reflected the “potential for aggressive shareholder returns and spending” that could weaken the company’s balance-sheet cushion.
It noted that the resumption of investment in Naga 3 could not be ruled out.
NagaCorp announced in December the termination of a subscription agreement that would have seen the company raise funds for its Naga 3 expansion project at the NagaWorld casino complex.
Nonetheless, the company stated its intention to continue with the development of the Naga 3 project. The firm had previously said it was likely to reduce the cost and scale of the expansion scheme.
“Depending on the revised investment amount, the project could be funded mainly by internal cash flows or via external markets,” S&P stated.
“If Naga accelerates Naga 3 capex or pursues large-scale investments amid aggressive shareholder distributions that erode its cash balance, the company’s credit quality could sharply deteriorate,” the institution noted.
For now, S&P estimates the casino firm’s capex at about US$170 million in 2026, before increasing to about US$380 million in 2027 for Naga 3, with annual shareholder returns forecast at US$100 million to US$120 million.
NagaCorp resumed dividend payments in 2025 with a 30-percent payout ratio.
