Melco Q3 revenue gains, with mass at record

Melco Resorts & Entertainment reported a 16 percent gain in Q3 revenue helped by a strong performance at City of Dreams Macau and a record level in the mass market and slots.

Total operating revenue was $1.44 billion, while adjusted property EBITDA gained 39 percent to $418.2 million. Net income was US$83.2 million, or US$0.17 per ADS, compared with US$11.3 million, or US$0.02 per ADS, in the third quarter of 2018. 

“During the third quarter of 2019, Melco’s mass market table games drop and gaming machine handle both reached all-time-record-highs,” Chairman and CEO Lawrence Ho said. “The third quarter of 2019 also marked the 16th consecutive quarter of positive year-over-year growth in mass market table games drop, highlighting the strength in Macau’s mass gaming market and Melco’s leadership position in the city’s mass and premium mass gaming segments.”

At the group’s flagship, City of Dreams Macau, the company reported rolling chip volume of $17.2 billion, up from $12.3 billion despite weakness in the broader VIP market. The win rate was 2.69 percent compared with 2.45 percent. 

“Broadly the VIP market has started to stabilise, at least at the beginning of Q4, and ultimately the VIP market in Macau is driven by the Chinese economy and policies. The sooner the trade war has some resolution and the RMB stops devaluing it will have a positive impact on Macau gaming,” Ho said. “There will be a moderation in the pace of decline.”

Mass market table games drop at City of Dreams increased to$1.41 billion, compared with US$1.34 billion in the third quarter of 2018. 

Revenue was higher at Altira, driven by the mass market, though revenue at Studio City slipped in the quarter to $337.7 million compared to US$345.2 million.

Studio City’s rolling chip volume was $2.77 billion down sharply from $5.09 billion in the third quarter of 2018. The rolling chip win rate was also below the normal range at 2.71 percent versus 3.12 percent.

Mass market table games drop increased to $880.6 million from $807.9 million in the third quarter of 2018.

At the City of Dreams Manila, Melco said it continued to suffer from increased competition in the market.

Total operating revenues in Manila were $130.5 million compared to $141.7 million in the third quarter of 2018. While adjusted EBITDA of $49.9 million compared to $55.2 million in the comparable period of 2018.

Rolling chip volume fell to $2.44 billion from $2.98 billion, while mass market table drop was down at $202.1 million from $204.9 million.