Melco Resorts & Entertainment managed to taper its loss in the second quarter to $23.44 million, down from $251.49 million in the same period of 2022, related to its Studio City, City of Dreams Manila and City of Dreams Mediterranean properties.
The figures come despite a 239 percent increase in casino revenue yearly, to $768.45 million, with the first six-month figure topping $1.36 billion, up 118 percent yearly.
The group generated adjusted property EBITDA of some $267.3 million, a strong increase from the loss of $13.8 million in the second quarter of 2022.
Speaking of the results, Lawrence Ho – CEO and Chairman of Melco noted that “We’ve seen mass drop increase month-to-month and turnover in our premium direct VIP segment continued to exceed 2019 during the second quarter.”.
Furthering the results announcement, the businessman noted that ““Labor supply issues in Macau have been largely resolved […] We expect to add another 560 hotel rooms to our portfolio with the opening of W Macau at Studio City in September and are well positioned to support the continuing increase of customers in Macau.”
The group notes that it has lost some 2,000 employees since 2019 but that the move is “expected to translate into continued cost savings”, according to the group’s CFO.
The group also notes that air traffic to Macau has only recovered to roughly 50 percent of pre-pandemic levels, despite overall tourism return exceeding expectations, “driven really by premium mass”, states Lawrence Ho.
The CEO notes that July has been the “best month since reopening”, despite starting out slow in the first quarter, and facing “aggressive” competition “in terms of the reinvestment and the referral fees that they pay”.
The group is now looking for the mass segment to truly augment its offerings, noting that its lower-end property Studio City is now capturing roughly 4 percent of market share.
Revenue at Studio City rose to $236 million during the quarter, up from $35.9 million in 2Q22, while adjusted EBITDA hit $31.1 million (from a loss of $41.1 million in 2Q22) – due to its ‘better performance in the mass market table games segment and non-gaming operations’.
City of Dreams saw some $506.2 milllion in revenue, up from $97.3 million in 2Q23, while adjusted EBITDA hit $161.2 million, reversing the $28.5 million loss from the same quarter of last year.
Altira Macau made just $29.3 million in revenue, up from $7.2 million in 2Q23, while adjusted EBITDA was $4.3 million (compared to negative $11.3 million in 2Q22)
City of Dreams Manila
Looking to the Philippines, the group notes that its property is “continuing to outperform 2019 in the second quarter of 2023”, according to the group Chairman, with revenues at $116.4 million – a slight increase from $111.7 million in 2Q22. The group’s adjusted EBITDA for the property actually shrank year-on-year, to $47 million from $49 million in 2Q22.
This was partially due to a drop in rolling chip – to $520.2 million from $771.3 million in the same quarter last year. Mass market drop also fell, to $194.5 million from $178.4 million in 2Q22. However, the gaming machine handle increased to $1.01 billion, from $925.5 million.
Non-gaming revenue at the property rose by roughly $1.4 million, to $28.7 million in the quarter compared to the same period last year.
Looking at the group’s new property in Cyprus – City of Dreams Mediterranean which opened on July 10th, the group recorded some $30.9 million in revenue during the quarter, up from $21.7 million in 2Q22. Adjusted EBITDA totaled $6.9 million, up from $5.6 million in 2Q22, due to ‘better performance in the mass market segment’.
Non-gaming revenue rose sharply as the group opened its property fully, reaching $1.9 million from $100,000 in 2Q22.