GIL's FY08 core net loss only accounts for 71% of our loss forecast and 63% of consensus. The smaller-than-expected loss was due to 4Q08's higher business patronage and drop/head, further boosted by better luck. Three key highlights from yesterday's conference call: 1) the Sentosa IR budget has been raised to S$6.59bn from S$6.0bn; 2) GIL will be incurring pre-operating costs in 2009, estimated at S$450m; and 3) GIL has guided for a lower project IRR to the tune of 13-14% from 15-20% previously. Our FY09-10 earnings have been adjusted by -268% to +65% to reflect year-end financial adjustments and revised Sentosa assumptions. Accordingly, our sum-of-the-parts target price drops to S$0.33 (from S$0.36). With prolonged weakness expected in the UK and limited re-rating catalysts until Sentosa IR opens its doors in 1Q2010, GIL remains an UNDERPERFORM.