Wynn praises features of new Macau resort
On the verge of Wynn Resorts’ opening of a 1,700-room resort on Macau’s Cotai Strip next month, the Las Vegas company reported an improved financial performance for the Chinese enclave and second-quarter earnings that surpassed analysts’ expectations.
But it wasn’t enough to satisfy investors who sent shares down 5.5 percent to $98.90 in after-hours trading Thursday.
The company earlier reported net income of $70.4 million, $1.07 a share, on revenue of $1.06 billion, for the quarter that ended June 30. That compared with $56.5 million, 74 cents a share, on revenue of $1.04 billion a year earlier. Analysts had forecast the company would post earnings of 91 cents a share and revenue of $1.02 billion.
The company also announced a 50-cents-per-share dividend, payable Aug. 23, and that environmental reviews of the company’s Wynn Boston Harbor project in Massachusetts have been completed, leading to construction beginning next week.
Company chairman Steve Wynn said he was particularly happy with the financial results in Macau where the company will open the $4.2 billion Wynn Palace on Aug. 22. He spent a large portion of an earnings conference call Thursday afternoon discussing preparations and how the company is optimizing table-game revenue with new strategies in casino floor layouts and comp policies.
In the second quarter, revenue in Macau climbed 3.6 percent to $639.3 million from 2015, partially offsetting a 1.1 percent decline to $419 million in Las Vegas.
A decrease in table-game drop and win resulted in the Las Vegas decline despite increases in room spend and retail.
“It’s the most diversified attraction we’ve ever built, and I say that unequivocally because it took six years to design and build it,” Wynn said of Wynn Palace in his conference call.
Wynn said there is entertainment in every corner of the floral-themed hotel. He said there are carousels, Ferris wheels and 25-foot Faberge eggs made of flowers throughout the property.
Wynn said the company spent between $70 million and $80 million on the property’s performance lake, which will include fountains similar to those at Wynn Macau and the Bellagio.
Wynn said he walked the property with his wife recently and said it “was the most joyful place I had ever seen.”
Wynn also said government infrastructure projects will make the destination even more attractive with work underway to transport people on monorail and light-rail systems that will be completed within two or three years and a bridge connecting Macau with Hong Kong due to open in 2020 or 2021.
The company is transferring employees from Wynn’s other Macau properties to Wynn Palace and they’ll soon be giving tours to invited guests and media prior to the opening.
Wynn said the recent building boom in Macau and the infrastructure improvements would benefit him and other operators in Macau who have new projects coming online. Both Las Vegas Sands and MGM Resorts International have projects underway on Macau’s Cotai Strip.
Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Find him on Twitter: @RickVelotta
