Wynn Resorts more that doubles second-quarter profit

Casino operator Wynn Resorts Ltd. continued to benefit from its casinos in Macau, and a rebound in Las Vegas as double-digit increases in revenues across the board helped the company more than double its second-quarter profit.

Wynn Resorts on Monday reported earnings of $122 million, or 97 cents a share, in the three months ended June 30, up from $52.4 million, or 42 cents a share, a year earlier.

On an adjusted basis, eliminating special charges, the Las Vegas-based company would have earned $200.8 million, or $1.60 a share, up from $64.9 million, or 52 cents.

Revenue rose 32 percent to $1.36 billion from $1.03 billion. Analysts surveyed by Yahoo Finance had expected the company to earn 99 cents a share on revenue of $1.26 billion.

"Once again, the numbers were spectacular," Steve Wynn, chairman and CEO of Wynn Resorts, said in a conference call with analysts Monday. "We are all heartened by the results."

Net revenues at Wynn Resorts' Las Vegas operation was $390.8 million, a 22.8 percent increase from the second quarter of last year.

The company reported EBITDA, or earnings before interest, taxes, depreciation and amortization, of $132.7 million, versus $65.1 million from the same period of 2010.

Casino revenue from the second quarter was $158.3 million, up 35.1 percent.

"We've benefited from a very good hold percentage," Wynn said.

Room revenue was up 15.5 percent to $91 million, with an average daily room rate of $240 at Wynn and Encore, an increase from $197 in the second quarter of 2010. Occupancy fell from 92.6 percent to 89.2 percent.

"It was an amazing quarter, with casino revenues up 35 percent," said Marilyn Spiegel, president of Wynn and Encore. "Volume was up in baccarat, table games and even slot machines. We had an amazing hold in baccarat."

Spiegel said the $91 million in room revenue was the "highest cash room revenue ever at Wynn Las Vegas."

Food and beverage revenues increased 13 percent, to $126 million, primarily driven by higher nightclub revenues and strong catering and restaurant revenues. Retail revenues were $22.8 million in the quarter, up 6.5 percent from last year.

Entertainment revenues increased
22 percent, to $19 million, from the second quarter of 2010. Spiegel attributed the increase primarily to increased revenues from Garth Brooks, who staged shows at Wynn Las Vegas in the second quarter.

In Macau, revenues were $976.5 million, a 36.7 percent increase from the $714.4 million generated in the second quarter of 2010. Adjusted property EBITDA was $314.3 million, up 45.4 percent, from $216.2 million in the same period a year earlier.

While Macau has driven the growth of the company over the last few years, Wynn told analysts Monday that he is interested in building a resort in Singapore, but is prepared to wait until March 2017 because of an exclusivity period granted by the government to incumbent operators, Las Vegas Sands Corp. and Genting.

"It's easy to say, Singapore is exciting," Wynn said. "If we ever had the chance to be in Singapore we would be thrilled and delighted to bring our best ever (hotel-casino) there."

In response to a question from Bill Lerner, an analyst with Union Gaming Research in Las Vegas, Wynn blamed the Obama administration for his caution in expanding his Las Vegas properties, Wynn and Encore.

He said he has had a host of opportunities and could create 10,000 more jobs at his Las Vegas properties, which would create and additional 20,000 jobs in the community.

"I believe in Las Vegas," Wynn said. "I'm afraid to do anything in the current political climate in this country."

He said the business community sits in "fear" of the president. Wynn, who described President Barack Obama as a socialist, said, "until he's gone, everyone is sitting on their thumbs."

Wynn also announced a quarterly cash dividend of 50 cents per share. Shares of Wynn Resorts shares bounced 2.27 percent, or $3.80, to $168.30, building on a gain of 1.4 percent, or $2.27, to $164.89 during the day ahead of the results Monday.

Wynn Resorts traded 3.29 million shares on Monday, well above its daily average of 1.97 million. The shares, which trade on the Nasdaq Global Select Market, have more than doubled in price over the past year.

Contact reporter Chris Sieroty at
csieroty@reviewjournal.com or 702-477-3893.