The upcoming opening of Wynn Al Marjan Island is a strong component of Wynn Resorts’ portfolio diversification, aiming to focus on wealth concentration in global hubs: the US, China and “portions of the Middle East”.
“We’re moving toward a portfolio where we expect over 55 percent of our revenues will be generated in non-US dollar-denominated markets from assets we developed and operate, each meticulously designed around the most valuable consumers in these key markets,” highlighted CEO Craig Billings on a Thursday earnings call.
“Anticipation of those changes is already fueling substantial business formation and wealth creation,” noted the executive. “That expanding wealth creation will continue to drive demand for what Wynn Resorts has always delivered,” indicated Billings.
“The opening of Wynn Al Marjan and the free cash flow inflection that it will bring reinforces our confidence that our best days lie ahead”.
Rooms on sale in “late Q3, early Q4”
On the earnings call, the CEO indicated that rooms at Wynn Al Marjan could go on sale in “late Q3, early Q4”. However, the executive notes that “We are not dependent on that incremental room capacity to meet our base case”.
However, “meeting the outperformance numbers or beyond would certainly require incremental hotel capacity”.
The executive notes that the group’s strategy is to have a “very strong transportation program and effectively utilize adjacent cities as a source of day-to-day visitation”.
Strong non-gaming demand expected
“On the gaming side, the market is extremely supply constrained,” indicated Billings, noting that that the company expects the market to have “many attributes that are consistent with Las Vegas, which is, very, very strong non-gaming demand. So the balance there really is how we utilize our room base.”
The executive anticipates a “healthy balance of non-gaming revenues reflecting substantial ADRs and a substantial willingness to spend in that market for food and beverage”.
Hosting
Wynn’s CEO highlights that the group already began building its hosting infrastructure over a year ago, by bringing on “very senior folks with regional experience”.
Billings notes that “one-to-one relationship marketing has been well underway”.
“I would say that general awareness among high-value players regionally is extremely high. I mean, we’ve been getting approached by people in pretty far-flung places asking when the property will be open”.
For mass market, the group has mostly been building its digital database and creating awareness.
“We’re feeling pretty good about people showing up the day we open the doors,” indicated the executive.
