Wynn Resorts Misses Q2 Earnings & Rev - Analyst Blog
31 7월 2013 - 3:00AM
Zacks
Wynn Resorts
Ltd.’s (WYNN) second-quarter 2013 adjusted earnings of
$1.51 per share missed the Zacks Consensus Estimate of $1.55 by
2.6% but beat the prior-year earnings of $1.38 per share by 9.4%.
Earnings in the quarter received a boost from a 10.8% rise in the
company’s adjusted property EBITDA.
Net revenue grew 6.3% year over
year to nearly $1.33 billion, driven by the company’s growing Las
Vegas business. However, revenues were lower than the Zacks
Consensus Estimate of $1.34 billion by 0.7%.
Adjusted EBITDA increased 10.8%
year over year to $425.7 million, driven by a 65.6% rise in the
EBITDA in Las Vegas operations.
Macau
Operations
Wynn reports its Macau table games
results under two categories: the VIP segment and the mass market
segment.
Wynn Macau’s revenues were up 2.6%
year over year to $930.9 million in the quarter, benefitting from
the strong mass market business. Table games win in the mass market
category was $217 million, up 8.5%. Moreover, the mass market table
games win rate was 34.6%, higher than the year-earlier rate of
29.8%.
The table games turnover in the VIP
segment plunged 1.6% from the prior-year period to $29.9 billion
due to the sluggish VIP market. However, VIP table games win rate
as a percentage of turnover was 2.94%, higher than the year-ago
level of 2.79%. It has also exceeded management’s expected range of
2.7%–3.0%.
Revenue per available room (RevPAR)
was up 5% to $300 in the second quarter, gaining from the 500 basis
points (bps) improvement in the occupancy rate to 95.5%, offset by
a 1% decline in average daily rate (ADR). Gross non-casino revenues
came in at $99.9 million, up 3.3% year over year.
Wynn Resorts is engaged in
developing a full-scale integrated resort on the Cotai land in
Macau, which is slated for a 2016 opening. Currently, the company
expects the project to cost around $4.0 billion. The company spent
around $113.3 million on the Cotai project in the quarter.
Las Vegas
Operations
Wynn Resorts’ revenues from Las
Vegas operations witnessed an upside of 16.2% year over year to
$401.4 million as net casino revenues increased 44.7% from the
prior-year period to $142.6 million. Moreover, gross non-casino
revenues climbed 3.9% annually to $302.1 million, benefited from
the higher revenue gains from the hotel, food and beverage as well
as retail segments, offset somewhat by lower entertainment
sales.
During the quarter, RevPAR was up
4.7% benefitting from a 5.6% increase in ADR, partially offset by a
70 bps decline in occupancy rate. In the second quarter, EBITDA
margin expanded 10.1 percentage points to 33.8%.
Our Take
Although the company’s earnings
increased year over year, it failed to meet the estimates.
Moreover, weak VIP business in Macau is a huge matter of
concern.
Further, the company’s upcoming
project at Cotai is expected to face extreme peer pressure from the
U.S.-based casino operator, Las Vegas Sands Corp.
(LVS), which has already established its business in Cotai
Strip.
However, this Zacks Rank #3 (Hold)
company has gained from its flourishing business in Las Vegas in
the recent times and the strong mass market category in Macau.
Some other casino operators worth
looking at the current level include Monarch Casino &
Resort Inc. (MCRI) and Full House Resorts
Inc. (FLL). While Monarch Casino & Resort carries a
Zacks Rank #1 (Strong Buy), Full House Resorts holds a Zacks Rank
#2 (Buy).
FULL HOUSE RESO (FLL): Free Stock Analysis Report
LAS VEGAS SANDS (LVS): Free Stock Analysis Report
MONARCH CASINO (MCRI): Free Stock Analysis Report
WYNN RESRTS LTD (WYNN): Free Stock Analysis Report
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Full House Resorts (AMEX:FLL)
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Full House Resorts (AMEX:FLL)
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