GGRAsia – Wynn Macau Ltd loss down 28pct sequentially in 2Q

Wynn Macau Ltd loss down 28pct sequentially in 2Q

Aug 05, 2021 Newsdesk Latest News, Macau, Top of the deck

Wynn Macau Ltd posted a net loss of US$116.6 million in the second quarter, 27.7 percent lower than in the first three months of 2021, it said on Thursday. The announcement followed United States-based parent company Wynn Resorts Ltd disclosing its second quarter results.

The Macau unit saw adjusted property earnings before interest, taxation, depreciation and amortisation (EBITDA) grow by 54 percent sequentially to US$67.6 million, Wynn Resorts said in a filing.

The second-quarter figure was also a major improvement from the negative EBITDA of US$193.6 million posted a year earlier.

Wynn Macau Ltd posted positive adjusted property EBITDA for a third consecutive quarter, following two quarters of negative results.

Combined second-quarter operating revenues from casino business at the firm’s Wynn Macau venue on Macau peninsula and Wynn Palace venue (pictured in a file photo) on Cotai, rose by 9.1 percent sequentially, to US$354.5 million.

Brokerage Sanford C. Bernstein stated in a note following the results announcement that Wynn Macau Ltd had “lost overall gross gaming revenue market share in the quarter (due to VIP), to 13.6 percent (from 14.1 percent in first quarter) but mass share improved.”

Wynn Macau and Wynn Palace posted in aggregate mass-market table drop of US$1.38 billion in the second quarter, up by 14.8 percent sequentially.

The trend was not as rosy for Wynn Macau Ltd in the VIP segment, where combined turnover hit US$3.3 billion for the April to June period, down by 17.5 percent from the previous quarter. Nonetheless, the company won just under US$111 million from its VIP table games, down by 28.5 percent sequentially.

Travel restrictions between Macau and mainland China have been increased since late July, due to new Covid-19 infections. Earlier this week, a family of four living in Macau was confirmed as being infected with the Delta variant of the coronavirus that causes Covid-19.

“We are currently unable to determine when and what additional measures may be introduced” by the local authorities in order to curb a potential Covid-19 outbreak in Macau, Wynn Resorts noted in its results announcement.

Macau’s Chief Executive, Ho Iat Seng, affirmed on Wednesday that the government was for now not ordering the closure of the city’s casinos.

Analysts at JP Morgan Securities (Asia Pacific) Ltd stated that Wynn Macau Ltd’s second quarter results, “despite EBITDA beat (US$68 million versus consensus US$52 million), appear backward-looking and have little impact on forward estimates, in our view, given recent travel restrictions in the region amid the COVID flare-ups.”

Wynn Macau Ltd had outstanding long-term debt of US$5.94 billion at the end of June, down from just under US$6 billion three months earlier. The firm had US$1.72 billion in cash or equivalents – down from US$1.80 billion at the end of March – as well as available borrowing capacity of US$293.2 million.

Wynn Resorts as a whole – which includes the Wynn Las Vegas resort in Nevada and the Encore Boston Harbor property in Massachusetts, both in the U.S. – recorded a quarterly net loss of US$131.4 million, down from US$281 million for the January to March period.