GGRAsia – Melco Resorts 2Q revenues up 32pct, loss down to US$23mln

Melco Resorts 2Q revenues up 32pct, loss down to US$23mln

Aug 01, 2023 Newsdesk Latest News, Macau, Philippines, Top of the deck

Casino operator Melco Resorts & Entertainment Ltd saw its net loss narrow to US$23.4 million in the second quarter, compared with a net loss of US$81.3 million in the preceding quarter. The latest reporting period’s net loss was down 90.7 percent from the prior-year, according to the firm’s second quarter results filed in the United States on Tuesday.

Total operating revenues for the three months to June 30 were US$947.9 million, up 32.3 percent from the first quarter this year. The figure was up 220.1 percent from a year earlier, said the company.

The increase in total operating revenues was “primarily attributable to the improved performance in all gaming segments and non-gaming operations” following the relaxation of Covid-19 related restrictions in Macau early this year, said the firm.

Other factors contributing to the improved performance during the period were the opening in April 2023 of “Studio City Phase 2’s Epic Tower and indoor waterpark”, as well as the “launch of residency concerts at Studio City in the same month,” it added.

Melco Resorts generated second-quarter adjusted property earnings before interest, taxation, depreciation and amortisation (EBITDA) of US$267.3 million, 40.1-percent higher sequentially. It compared with negative adjusted property EBITDA of US$13.8 million in the second quarter of 2022.

“The strength of our Macau recovery is evident in the 43-percent increase in gross gaming revenue in the second quarter of 2023 compared to the first quarter of 2023,” said Lawrence Ho Yau Lung, the group’s chairman and chief executive, in prepared remarks accompanying the results.

“We’ve seen mass drop increase month-to-month and turnover in our premium direct VIP segment continued to exceed 2019 during the second quarter,” he stated.

The CEO also said that labour supply issues in Macau “have been largely resolved,” with the company able to provide the “full suite of services and amenities” to its customers.

He added: “We expect to add another 560 hotel rooms to our portfolio with the opening of W Macau at Studio City in September and are well positioned to support the continuing increase of customers in Macau.”

Strong mass in Macau, Philippines

At the group’s Macau flagship property, City of Dreams (pictured), on Cotai, total operating revenues in the second quarter this year were US$506.2 million, versus US$358.3 million in the first quarter this year, and US$97.3 million a year earlier.

The property generated adjusted EBITDA of US$161.2 million, compared with negative adjusted EBITDA of US$94.9 million in the first three months of 2023, and a negative figure of US$28.5 million a year ago.

VIP rolling chip volume at the property was US$5.76 billion for the three months ended March 31, up 42.4 percent sequentially. Rolling chip volume was US$748.1 million in the three months to June 30, 2022.

Mass-market table games drop at City of Dreams increased by 21.6 percent quarter-on-quarter to US$1.24 billion in the second quarter of 2023. It was US$209.1 million in the prior-year period.

For the quarter ended June 30, total operating revenues at the group’s majority-owned Cotai venue Studio City were US$236.0 million, compared with US$142.2 million in the preceding quarter, and US$35.9 million a year earlier. The property generated adjusted EBITDA of US$41.1 million in the second quarter, compared with US$20.6 million in the first three months of 2023, and negative adjusted EBITDA of US$31.1 million a year earlier.

At City of Dreams Manila, a casino resort in the Philippine capital, total operating revenues were US$116.4 million, down 12.7 percent quarter-on-quarter, but up 4.2 percent from a year ago.

The complex generated adjusted EBITDA of US$47.0 million in the three months to June 30, compared with adjusted EBITDA of US$60.9 million in the preceding quarter, and US$49.0 million in the comparable period of 2022.

VIP rolling chip volume at that property was US$520.2 million in the second quarter of 2023 versus US$655.8 million in the first three months this year, and US$771.3 million a year earlier. Mass-market table games drop increased to US$194.5 million, compared with US$177.1 million in the previous quarter, and US$178.4 million in the second quarter of 2022.

“The mass segment is also leading the recovery in the Philippines, continuing to outperform 2019 in the second quarter of 2023,” stated Mr Ho.

In Cyprus, the City of Dreams Mediterranean casino resort had a “successful soft opening” in June, said the CEO. “We’re excited for its prospects as we ramp up our operations,” following the official launch of the property in July, he added.