Melco Resorts Chairman and CEO Lawrence Ho says the company has no plans to push its new luxury hotel tower Morpheus further into the VIP segment once it opens in early 2018.
His comments were made during the company’s 3Q17 earnings call after Melco last week announced a 19% year-on-year revenue boost to US$1.38 billion for the quarter, driven primarily by VIP at its City of Dreams and Studio City properties in Macau.
The results prompted questions about future plans for Morpheus, which Melco has previously stated would target premium mass, but Ho said the mix would not change despite the improved performance of VIP in 2017.
“Of course VIP has pleasantly surprised everyone and … so far this year we’ve seen an outsized increase in VIP business,” he said. “We’re happy to take that. It’s a great opportunity and we’ll continue to capitalize on that, but I think the long-term development of the market will continue to be based on premium mass.
“We’re really excited about the opening of Morpheus because that will really launch a new face of City of Dreams, a re-imagined City of Dreams. We’ve done a lot of work to improve City of Dreams over the last few years and it’s all going to be the big moment to make a big launch that will really help us realize our dreams.
“So with all the hard work and investments over the years with Morpheus leading the way next year, we think there is a great chance for us to capture again an outsized growth in the market in both the premium mass and also the premium direct side of the business.”
Ho also denied suggestions that Melco Resorts may look to offload its original Macau property Altira, which suffered a significant decline in 3Q17 with net revenue falling from US$128.8 million in 3Q16 to US$89.3 million and Adjusted EBITDA from US$14 million to US$5.6 million.
“Altira was our first property,” he added. “Where I’m extremely proud of it is … I think of it as really my first child. And I think with … some [of the] significant efforts in terms of rejuvenating Altira, I’m happy with where it’s heading.
“I know that somehow there is always this notion in the market that Altira is on the selling block. There is absolutely no truth to it whatsoever. Altira is a phenomenal property that is critical to our portfolio of assets.”