Shares in Wynn Resorts tanked 10 percent in after hours trading Tuesday after the company posted much lower-than-expected 15Q1 adjusted earnings as revenue from its Macau operations fell 37.7 percent.
The company reported overall net revenue of $1.1 billion, missing estimates for $1.2 billion, according to Capital IQ. Las Vegas revenue gained 1.6 percent.
Adjusted earnings for the quarter were $70.7 million, or $0.70 a diluted share, slumping from $236.7 million, or $2.32 a share in the year earlier quarter. That’s significantly below the $1.33 analysts had been looking for.
Wynn also announced Tuesday that it was slashing its dividend to $0.50 a share from the $1.50 paid the prior quarter.
In Macau, adjusted property EBITDA dropped almost 45 percent to $212.3 million, mainly due to a drop in VIP revenue. Table games turnover in the VIP segment fell by half to $17.1 billion. The decline in revenue was exacerbated by a drop in VIP tables in the quarter to 252 units, from 279 in the same quarter a year earlier due to a renovation of the casino floor.
The company also reported weakness in the mass market segment, which although slowing has been less badly affected by China’s crackdown on corruption and some of the other issues that have dented gross gambling revenue in Macau.
Drop in the mass segment was $591.9 million, down 14.5 percent.
Occupancy at the Wynn Macau slipped slightly to 97.5 percent compared with 98.1 percent a year earlier, while revenue per available room slipped 2.4 percent.
Wynn said in Q1 it invested about $374.3 million in its new Cotai property, the Wynn Palace, taking the total investment to date to $2.2 billion. The total cost of the project once completed will be $4.1 billion.
The company said it plans to open the resort, which will feature a 1,700-room hotel, a performance lake, casino, spa, retail and other outlets, in the first half of 2016.
The shares fell as low as $114.52, the weakest level in more than two years.