Instead of just adding casino space to its newly opened $1.2 billion casino in Macau, Wynn Resorts Ltd. announced late Wednesday it would construct a second hotel-casino in the ever-expanding gaming market.
The company did not announce a cost for the project and did not reveal the number of hotel rooms it plans to build on the second site.
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"Financing for the new hotel is yet to be arranged and requires the approval of our existing lenders," Wynn Resorts said in a statement.
Wynn Macau, which opened Sept. 6, has 600 hotel rooms and a 100,000-square-foot casino that has 212 gaming tables -- primarily baccarat -- and 375 slot machines.
The new resort would be called Wynn Diamond Suites, reflecting that its room inventory would be all suites.
An expansion at Wynn Macau is expected to open in February and will add 119 gaming tables. The expanded casino space will eventually become part of the casino area of the new resort, the company said.
Wynn Resorts Chairman Steve Wynn, who just returned from Macau, could not be reached for comment. Samanta Stewart, who oversees investor relations for Wynn Resorts, said the decision to build a second hotel-casino reflects the strength of the Macau market.
On the company's conference call last week to announce earnings for the three-month period that ended Sept. 30, Wynn said the Macau casino generated revenues of $45 million in its first 25 days of operation. More than 81 percent of the gaming revenues came from table game play.
The company said $134 million was wagered by customers on table games and $1.5 billion was gambled by what Wynn referred to as the "VIP segment."
Wynn said the Macau casino was operating disproportionately to its size. In September, the casino had cash flow, or earnings before interest, taxes, depreciation and amortization of $2.3 million. In October, Wynn revealed to analysts that Wynn Macau will earn $19.5 million in cash flow.
Deutsche Bank gaming analyst Bill Lerner said the announcement validates that Macau's mass market customers are much deeper anyone expected.
"This announcement shows that there is a place in Macau for nongaming amenities," Lerner said.
