GGRAsia – Wynn Macau Ltd avoids dividend amid Covid-19 crisis

Wynn Macau Ltd avoids dividend amid Covid-19 crisis

Mar 31, 2020 Newsdesk Latest News, Macau, Top of the deck

The board of Macau casino operator Wynn Macau Ltd says it has not recommended a final dividend for calendar year 2019. The announcement was made in its 2019 annual report, filed after Hong Kong stock trading hours on Monday.

The firm – which runs the Wynn Palace casino resort (pictured) on Cotai, and the Wynn Macau property in downtown Macau – said its directors had deliberated over the issue before reaching such a decision.

The firm stated in its results filing, referring to the human infection associated with the novel coronavirus pandemic: “During this unprecedented Covid-19 crisis, the board’s primary focus is on safeguarding its Macau operations and most importantly the well-being of its over 13,000 employees.”

The company added: “The board will be continuously monitoring the situation and market conditions in Macau and Greater China and may consider a special dividend in the future when such conditions have stabilised.”

During the fourth-quarter earnings call in early February of the parent, United States-based Wynn Resorts Ltd – which occurred amid a 15-day closure of all Macau gaming floors as part of efforts to control the spread locally of the coronavirus – the group’s chief executive Matt Maddox had said the Macau pause in operations had cost between US$2.4 million to US$2.6 million a day.

All Macau’s operators have so far reportedly resisted major redundancies among local workers as a way of cutting costs.

The Macau casinos are currently operating, but a succession of travel restrictions by the Macau authorities and other jurisdictions has narrowed the potential customer base for gaming operations, say a number of investment analysts.

A Friday memo from brokerage JP Morgan Securities (Asia Pacific) Ltd had noted that Guangdong, the mainland China province neighbouring Macau, had imposed a 14-day quarantine for all people entering the province “including mainlanders returning from overseas and [from] the Hong Kong/Macau SARs”.

“For Macau, this is effectively the same as casino shutdown,” said analysts DS Kim, Derek Choi and Jeremy An, referring to the importance of the mainland tourism segment, which had already been constrained by a suspension of individual visit scheme visas and package tour visas to Macau.

On Thursday the board of Macau-based casino operator MGM China Holdings Ltd – a firm controlled by U.S.-based MGM Resorts International – recommended the payment of a final dividend of HKD0.083 per share (US$0.01) to the company’s shareholders.