Studio City, COD Manila boost Melco results

Melco Crown Entertainment posted a 13 percent gain in Q4 revenue as an improved performance at Studio City and City of Dreams Manila offset declines at its older properties.

Revenue came in at $1.19 billion, up from $1.05 billion a year earlier, in line with consensus estimates.

Adjusted property EBITDA was $304.3 million as compared to $236.4 million in the fourth quarter of 2015, representing an increase of 29 percent. Net income gained to $43.3 million, or $0.09 per ADS, compared with a net loss of $12.3 million, or $0.02 per ADS a year earlier.

“We delivered a strong set of results in the fourth quarter of 2016, highlighted by record mass table gross gaming revenues in Macau and a 29 percent year-on-year increase in group-wide adjusted property EBITDA,” said Chairman and CEO Lawrence Ho.

“Studio City’s mass table games revenues continued to expand, increasing almost 10 percent from the prior quarter which, combined with the rolling chip operations that began in November 2016, delivered a strong improvement in underlying earnings.”

Ho said Macau shows signs of a broader recovery going into 2017.

Net revenue at City of Dreams Macau was $661.1 million compared to $669.0 million in the fourth quarter of 2015, while adjusted EBITDA was $188.7 million, a decrease of 2%.

At Studio City revenue doubled to $246.2 million compared to US$123.2 million, while adjusted EBITDA gained to $56.7 million from $12.6 million.

City of Dreams Manila saw revenue jump to $144.7 million compared to $80.9 million, with adjusted EBITDA reaching $50.2 million from $15.5 million.

“City of Dreams performed slightly weaker than expected, largely due to low VIP hold,” said Bernstein in a note on Friday. “Studio City's ramp up is weaker than expected with Property EBITDA up 8 percent quarter-on-quarter to $57 million, largely because of a low 1.4 percent VIP hold rate.  Both of Mocha and Altira showed decline in revenue and EBITDA, which was not unexpected,” it added.

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