Casino operator Melco Resorts & Entertainment Ltd has clinched arrangements to extend by two years the maturity date on HKD14.85-billion worth – which it said was equivalent to US$1.92-billion – of an existing revolving credit facility.
The new maturity date will now be April 29, 2027, instead of April 29, 2025, according to a Monday press release by Melco Resorts.
Also on Monday, United States-listed Melco Resorts said its unit Melco Resorts Finance Ltd would conduct an international offering of senior notes. Melco Resorts itself, “will not be a guarantor of the new notes,” stated the filing.
The net proceeds would be used to make a “partial repayment of the principal amount outstanding under the revolving credit facility, together with accrued interest and associated costs,” that had been contracted by MCO Nominee One Ltd, a subsidiary of Melco Resorts Finance.
The interest rate and other terms of the new notes “will be determined at the time of pricing of the offering,” said the filing.
According to Melco Resorts, the 2020 credit facilities were established on April 29 that year, between parties including MCO Nominee One as borrower, and Bank of China Ltd, Macau Branch as agent.
The agreement was subsequently amended and restated on June 29, 2023.
The company said it repaid part of its outstanding loan, plus interest, on March 28, “increasing the availability under the 2020 credit facilities to HKD7.80 billion”.
Melco Resorts Finance’s 2023 annual report, also issued on Monday via the U.S., outlined that as of December 31, its long-term net debt had decreased 11.8 percent year-on-year, to just under US$4.99 billion, from nearly US$5.66 billion in 2022.
As of December 31, Melco Resorts Finance had US$3.00-billion worth of long-term debt due in the “one to three years” category.
The 2023 annual report stated, referring to post-pandemic recovery in group operations: “With improving free cash flows, we are focused on debt repayment and continued deleveraging and continue to actively manage our debt maturity profile and liquidity availability.”
Melco Resorts Finance added: “We repaid US$850 million of our credit facilities in 2023 and an additional US$149.5 million in the first quarter of 2024.
“This month, we extended the maturity date of the 2020 credit facilities maturity date from April 2025 to April 2027.”
The Melco Resorts group is yet to reinstate dividends, having suspended such payments during the Covid-19 pandemic.
Lawrence Ho Yau Lung, chairman and chief executive of Melco Resorts, said on a call with investment analysts in late February that his company’s “number one goal continues to be debt reduction”.
Melco Resorts runs casinos in Macau, a property in the Philippine capital Manila, and gaming venues on the Mediterranean island of Cyprus. Net loss attributable to Melco Resorts for full-year 2023 was US$326.9 million, an improvement on the US$930.5-million loss recorded in 2022.
