Wynn Resorts’ Macau operations saw a lackluster first quarter of the year, with operating income falling by 38.27 percent, and overall revenue down by 13.3 percent.
In results published by Wynn Resorts on Wednesday, the company indicated that its Macau operations brought in some $127.15 million, a steep drop from the $205.98 recorded in 1Q24, while revenue from its Wynn Palace and Wynn Macau operations brought in some $865.89 million (from $998.64 million in 1Q24).
Casino revenue across the two properties fell by 12.2 percent yearly, totaling $720.05 million. The group’s peninsula property, Wynn Macau, saw a larger hit – with casino revenue down by 20.4 percent yearly to $275.55 million.
Wynn Palace, in Cotai, brought in $444.5 million in casino revenue during the quarter down by 6.2 percent yearly.
The casino revenue results had a strong impact on income from each property, with Wynn Macau’s income down by 47.8 percent yearly to $52.74 million. Meanwhile, Wynn Palace saw a drop of 27.3 percent in income for the quarter, totaling just $82.56 million.
Similarly Property EBITDAR was down by 25.76 percent across the two properties, totaling $252.08 million, as Wynn Macau fell by 34.3 percent (to $90.2 million) and Wynn Palace dropped by 20 percent (to $161.88 million).
The group also saw a significant reduction in VIP table games win, with that of Wynn Palace down by 19.2 percent, to $104.53 million and Wynn Macau down by 70.8 percent yearly, to $15.71 million.
Speaking of the results, Wynn Resorts CEO Craig Billings noted that “VIP hold negatively impacted results” in Macau, with VIP table games win as a percentage of turnover at 2.61 percent at Wynn Palace (below the expected range of 3.1 percent to 3.4 percent) and was 1.09 percent at Wynn Macau (below the expected range of 3.1 percent to 3.4 percent).
Earnings call
During the group’s earnings call, CEO Billings indicated that its Macau business is “holding up quite well”, noting that “mass drop in April was in line with 2024, and direct VIP turnover was up nicely”. Looking at Golden week, the executive indicated that mass drop was “up from last year”.
Speaking of the first quarter, Billings indicated that “other than hold, the business in Q1 felt very good”, despite poor VIP holding costing the company “nearly $40 million of EBITDA”. Adjusting for VIP hold, the group “grew market share sequentially”.
“While the market in Macau continues to be highly competitive, we remain disciplined in our focus on maximizing EBITDA and generating a healthy margin profile,” noted Billings.
The group’s results have encouraged the Wynn Macau board to recommend an increase in the final dividend for 2024 to $125 million, up from $50 million in the previous period. This is subject to shareholder approval in a May 23rd meeting.
Speaking of the market overall after COVID, Billings acknowledged that there is now a “very, very competitive dynamic”, furthering that “the promotional environment is actually quite stable, but it’s day-to-day, hand-to-hand combat in order to be competitive in that market”.
