Wynn Macau’s fourth-quarter adjusted property earnings before interest, taxes, depreciation and amortization fell 36% year on year to US$241.2 million. That compared with the $249 million median estimate of nine analysts surveyed by Bloomberg News.
“We think negative earnings revision will continue; management sounded downbeat on the near-term outlook for Macau,” wrote Morgan Stanley analysts led by Praveen Choudhary.
The delay of Wynn Resort’s US$4.1 billion resort on Macau’s Cotai Strip is also a concern. The company was told this week by its construction contractor that the project won’t be finished in time for the Lunar New Year in February 2016 because of the timing of permits. Wynn said the company hasn’t been able to hire all the construction workers it wanted.
“I do believe that for all of Chinese businessmen, there is at the moment a bit of uncertainty as to what the future will hold, because so much of everything in China depends upon the policy of the central government,” Steve Wynn, the company’s chairman and chief executive officer, said on a conference call after the earnings announcement.
Wynn Resorts reported fourth-quarter profit and sales that missed analysts’ estimates as revenue in Macau declined. The Macau unit contributed two-thirds of the group’s revenue in the fourth quarter.
Table games turnover in the VIP segment dropped 40% year on year to $20.7 billion for the fourth quarter. Mass-table win—or revenue from mass-market gamblers—fell 15% to $249 million in the quarter. The company’s January mass business in Macau rose 26% year on year.
“The changes in China have had a negative effect on all of the top-end business, whether that means retail top-end like Rolex and Louis Vuitton or whether we’re talking about the high-end gaming and junkets in the VIP section,” Mr Wynn said.
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