The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from Business Wire

Wynn Resorts, Limited Reports First Quarter 2013 Results

Thursday, April 25, 2013

Wynn Resorts, Limited Reports First Quarter 2013 Results

16:02 EDT Thursday, April 25, 2013

LAS VEGAS (Business Wire) -- Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the first quarter ended March 31, 2013.

Net revenues for the first quarter of 2013 were $1,378.7 million, compared to $1,313.5 million in the first quarter of 2012. The revenue increase was driven by 4.4% higher revenues from our Macau Operations coupled with a 6.6% increase in revenues from our Las Vegas Operations. Adjusted property EBITDA (1) was $451.1 million for the first quarter of 2013, up 15.5% compared to $390.7 million in the first quarter of 2012.

On a US GAAP basis, net income attributable to Wynn Resorts for the first quarter of 2013 was $203.0 million, or $2.00 per diluted share, compared to net income attributable to Wynn Resorts of $140.6 million, or $1.23 per diluted share in the first quarter of 2012. Adjusted net income attributable to Wynn Resorts in the first quarter of 2013 was $205.6 million, or $2.03 per diluted share (adjusted EPS) (2) compared to adjusted net income attributable to Wynn Resorts of $151.9 million, or $1.33 per diluted share in the first quarter of 2012. In the first quarter of 2013, EPS was based on 101.4 million diluted shares compared to 114.0 million diluted shares outstanding in the first quarter of 2012, largely due to the redemption of Aruze USA, Inc.'s 24.5 million shares on February 18, 2012.

Wynn Resorts also announced today that it has approved a cash dividend for the quarter of $1.00 per common share. This dividend will be payable on May 23, 2013, to stockholders of record on May 9, 2013.

Macau Operations

In the first quarter of 2013, net revenues were $992.1 million, a 4.4% increase from the $950.7 million generated in the first quarter of 2012. Adjusted property EBITDA in the first quarter of 2013 was $330.7 million, up 14.1% from $289.8 million in the first quarter of 2012.

Table games results in Macau are segregated into two distinct reporting categories, the VIP segment and the mass market segment.

Table games turnover in the VIP segment was $28.4 billion for the first quarter of 2013, a 15.3% decrease from $33.5 billion in the first quarter of 2012. VIP table games win as a percentage of turnover (calculated before discounts and commissions) for the quarter was 3.14%, which was higher than our expected range of 2.7% to 3.0% and the 2.59% experienced in the first quarter of 2012.

Table games win in the mass market category was $243.1 million during the period, a 13.6% increase from $214.0 million in the first quarter of 2012. Mass market table games win percentage (calculated before discounts) of 35.5% was higher than the 30.3% generated in the 2012 quarter. Note that customers purchase mass market gaming chips at either the gaming tables or the casino cage. Chips purchased at the casino cage are excluded from table games drop and will increase the expected win percentage.

Slot machine handle was $1.1 billion for the first quarter of 2013, a 23.4% decline compared to the prior year quarter. Win per unit per day was 7.1% lower at $809, compared to $871 in the first quarter of 2012.

We achieved an Average Daily Rate (ADR) of $315 for the first quarter of 2013, 2.7% below the $324 reported in the first quarter of 2012 while the property's occupancy was 93.8%, compared to 91.3% during the prior year period, and revenue per available room (REVPAR) was $296 in the 2013 quarter, which was flat with the first quarter of 2012. Gross non-casino revenues decreased 0.9% during the quarter to $105.3 million from $106.3 million in the prior year quarter.

We currently have 503 tables (288 VIP tables, 205 mass market tables and 10 poker tables) and 834 slot machines.

Cotai

The Company is constructing a full scale integrated resort containing a casino, hotel, convention, retail, entertainment and food and beverage offerings on the Cotai land and currently estimates the project budget to be in the range of $3.5 billion to $4.0 billion. The Company expects to enter into a guaranteed maximum price contract for the project construction costs in the first half of 2013. We started foundation work in February 2013 and expect to open our resort in Cotai during the first half of 2016.

During the first quarter of 2013, we spent approximately $76.3 million on our Cotai project.

Las Vegas Operations

For the first quarter ended March 31, 2013, net revenues were $386.6 million, a 6.6% increase from the first quarter of 2012. Adjusted property EBITDA of $120.4 million was up 19.3% versus the $100.9 million generated in the comparable period in 2012. EBITDA margin on net revenues was 31.1% in the first quarter of 2013 compared to 27.8% in the first quarter of 2012.

Net casino revenues in the first quarter of 2013 were $176.3 million, up 11.8% from the first quarter of 2012. Table games drop of $668.9 million was up 2.2% compared to $654.5 million in the 2012 quarter and table games win percentage of 26.7% was higher than the property's expected range of 21% to 24% and above the 22.8% reported in the 2012 quarter. Slot machine handle of $696.6 million was 3.1% below the $718.9 million in the comparable period of 2012 and net slot win was down 1.7% to $42.3 million.

Gross non-casino revenues for the quarter were $256.4 million, 1.6% higher than in the first quarter of 2012 due to increases in hotel and food and beverage, which were partially offset by lower entertainment revenues.

Room revenues were up 4.8% to $91.5 million during the quarter, versus $87.4 million in the first quarter of 2012. Average Daily Rate (ADR) was up 1.4% to $258 while occupancy of 82.9% was higher than the 79.3% experienced in the first quarter of 2012. Revenue per available room (REVPAR) was $214 in the 2013 quarter, 6.0% above the $202 reported in the prior year quarter.

Food and beverage revenues increased 6.0% to $115.4 million primarily due to the strength in our restaurant, night club and beach club businesses. Retail revenues were $19.7 million in the quarter, down 0.9% from last year's quarter. Entertainment revenues were down 28.3% due to a show that ended its run at the Encore theater in November 2012.

Balance Sheet and other

Our total cash and investments at March 31, 2013 were $2.3 billion. Total debt outstanding at the end of the quarter was $5.8 billion, including $3.1 billion of Wynn Las Vegas debt, $749 million of Wynn Macau debt and $1.9 billion at the parent company.

Corporate expense was down $7.0 million as we incurred significant expenses associated with the redemption of the Aruze USA, Inc.'s shares during the first quarter of 2012.

Conference Call Information

The Company will hold a conference call to discuss its results on Thursday, April 25, 2013 at 1:30 p.m. PT (4:30 p.m. ET). Interested parties are invited to join the call by accessing a live audio webcast at http://www.wynnresorts.com (Investor Relations).

Forward-looking Statements

This release contains forward-looking statements regarding operating trends and future results of operations. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those we express in these forward-looking statements, including, but not limited to, our dependence on existing management, results of regulatory or enforcement actions and probity investigations, pending or future legal proceedings, uncertainties over the development and success of new gaming and resort properties, adverse tourism trends, general global macroeconomic conditions, changes in gaming laws or regulations, volatility and weakness in world-wide credit and financial markets, and our substantial indebtedness and leverage. Additional information concerning potential factors that could affect the Company's financial results is included in the Company's Annual Report on Form 10-K for the year ended December 31, 2012 and the Company's other periodic reports filed with the Securities and Exchange Commission. The Company is under no obligation to (and expressly disclaims any such obligation to) update or revise its forward-looking statements as a result of new information, future events or otherwise.

Non-GAAP financial measures

(1) “Adjusted property EBITDA” is earnings before interest, taxes, depreciation, amortization, pre-opening costs, property charges and other, corporate expenses, intercompany golf course and water rights leases, stock-based compensation, and other non-operating income and expenses, and includes equity in income from unconsolidated affiliates. Adjusted property EBITDA is presented exclusively as a supplemental disclosure because management believes that it is widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses adjusted property EBITDA as a measure of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors. The Company also presents adjusted property EBITDA because it is used by some investors as a way to measure a company's ability to incur and service debt, make capital expenditures and meet working capital requirements. Gaming companies have historically reported EBITDA as a supplement to financial measures in accordance with U.S. generally accepted accounting principles (“GAAP”). In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including Wynn Resorts, Limited, have historically excluded from their EBITDA calculations pre-opening expenses, property charges, corporate expenses and stock-based compensation, that do not relate to the management of specific casino properties. However, adjusted property EBITDA should not be considered as an alternative to operating income as an indicator of the Company's performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure determined in accordance with GAAP. Unlike net income, adjusted property EBITDA does not include depreciation or interest expense and therefore does not reflect current or future capital expenditures or the cost of capital. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other non-recurring charges, which are not reflected in adjusted property EBITDA. Also, Wynn Resorts' calculation of adjusted property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

(2) Adjusted net income attributable to Wynn Resorts is net income before pre-opening costs, property charges and other, and other non-cash non-operating income and expenses. Adjusted net income attributable to Wynn Resorts and adjusted net income per share attributable to Wynn Resorts (“adjusted EPS”) are presented as supplemental disclosures because management believes that these financial measures are widely used to measure the performance, and as a principal basis for valuation, of gaming companies. These measures are used by management and/or evaluated by some investors, in addition to income and EPS computed in accordance with GAAP, as an additional basis for assessing period-to-period results of our business. Adjusted net income attributable to Wynn Resorts and adjusted net income attributable to Wynn Resorts per share may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

The Company has included schedules in the tables that accompany this release that reconcile (i) net income attributable to Wynn Resorts to adjusted net income attributable to Wynn Resorts, and (ii) operating income to adjusted property EBITDA and adjusted property EBITDA to net income attributable to Wynn Resorts.

   
WYNN RESORTS, LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except per share data)
(unaudited)
     
 
Three Months Ended
March 31,
2013 2012
 
Operating revenues:
Casino $ 1,106,503 $ 1,049,279
Rooms 120,480 117,503
Food and beverage 139,701 135,140
Entertainment, retail and other   101,548     105,909  
Gross revenues 1,468,232 1,407,831
Less: promotional allowances   (89,578 )   (94,333 )
Net revenues   1,378,654     1,313,498  
 
Operating costs and expenses:
Casino 697,188 674,656
Rooms 33,390 29,984
Food and beverage 73,873 70,396
Entertainment, retail and other 40,326 51,658
General and administrative 94,909 105,950
Provision for doubtful accounts 7,004 18,064
Pre-opening costs 452 -
Depreciation and amortization 92,518 92,405
Property charges and other   5,346     10,286  
Total operating costs and expenses 1,045,006 1,053,399
 
Operating income   333,648     260,099  
 
Other income (expense):
Interest income 4,222 1,565
Interest expense, net of capitalized interest (75,377 ) (62,061 )
Increase in swap fair value 3,144 2,284
Loss on retirement of debt - (4,828 )
Equity in income from unconsolidated affiliates 200 465
Other   1,165     768  
Other income (expense), net   (66,646 )   (61,807 )
 
Income before income taxes 267,002 198,292
 
Benefit for income taxes   5,142     117  
 
Net income 272,144 198,409
 
Less: Net income attributable to noncontrolling interest   (69,181 )   (57,845 )
 
Net income attributable to Wynn Resorts, Limited $ 202,963   $ 140,564  
 
 
Basic and diluted income per common share:
Net income attributable to Wynn Resorts, Limited:
Basic $ 2.02 $ 1.25
Diluted $ 2.00 $ 1.23
Weighted average common shares outstanding:
Basic 100,237 112,704
Diluted 101,373 114,008
 
Dividends declared per common share $ 1.00 $ 0.50
 
 
         
WYNN RESORTS, LIMITED AND SUBSIDIARIES
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED
TO ADJUSTED NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED
(amounts in thousands, except per share data)
(unaudited)
 
 
Three Months Ended
March 31,
2013 2012
 
Net income attributable to Wynn Resorts, Limited $ 202,963 $ 140,564
Pre-opening costs 452 -
Increase in swap fair value (3,144 ) (2,284 )
Property charges and other 5,346 10,286

Loss on retirement of debt

- 4,828
Adjustment for noncontrolling interest   20     (1,455 )
Adjusted net income attributable to Wynn Resorts, Limited(2) $ 205,637   $ 151,939  
 
 
Adjusted net income attributable to Wynn Resorts, Limited per diluted share $ 2.03   $ 1.33  
 
 
               
WYNN RESORTS, LIMITED AND SUBSIDIARIES
RECONCILIATION OF OPERATING INCOME TO ADJUSTED PROPERTY EBITDA

AND ADJUSTED PROPERTY EBITDA TO NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED

(amounts in thousands)
(unaudited)
 
Three Months Ended March 31, 2013

Macau
Operations

Las Vegas
Operations

Corporate
and Other

Total
 
Operating income $ 251,526 $ 40,419 $ 41,703 $ 333,648
 
Pre-opening costs 452 - -

 

452
Depreciation and amortization 29,297 61,610 1,611 92,518
Property charges and other 2,619 2,754 (27 ) 5,346
Management and royalty fees 39,196 5,795 (44,991 ) -
Corporate expense and other 6,618 7,603 3,561 17,782
Stock-based compensation 1,003 2,227 (2,108 ) 1,122

Equity in income (loss) from unconsolidated affiliates

-

(51

)

251 200
       
Adjusted Property EBITDA (1) $ 330,711   $ 120,357   $ -   $ 451,068  

 

 

 

Three Months Ended March 31, 2012

Macau
Operations

Las Vegas
Operations

Corporate
and Other

Total
 
Operating income $ 211,723 $ 20,426 $ 27,950 $ 260,099
 
Depreciation and amortization 28,288 63,418 699 92,405
Property charges and other 6,568 3,718 - 10,286
Management and royalty fees 38,059 5,451 (43,510 ) -
Corporate expense and other 6,548 6,387 11,819 24,754
Stock-based compensation (1,413 ) 1,371 2,690 2,648

Equity in income from unconsolidated affiliates

- 113 352 465
       
Adjusted Property EBITDA (1) $ 289,773   $ 100,884   $ -   $ 390,657  
 
Three Months Ended
March 31,
2013 2012
Adjusted Property EBITDA (1) $ 451,068 $ 390,657
 
Pre-opening costs (452 ) -
Depreciation and amortization (92,518 ) (92,405 )
Property charges and other (5,346 ) (10,286 )
Corporate expenses and other (17,782 ) (24,754 )
Stock-based compensation (1,122 ) (2,648 )
Interest income 4,222 1,565
Interest expense, net of capitalized interest (75,377 ) (62,061 )
Increase in swap fair value 3,144 2,284

Loss on retirement of debt

- (4,828 )
Other 1,165 768
Benefit for income taxes   5,142     117  
 
Net income 272,144 198,409
 
Less: Net income attributable to noncontrolling interest   (69,181 )   (57,845 )
 
Net income attributable to Wynn Resorts, Limited $ 202,963   $ 140,564  

 

 

 
   

WYNN RESORTS, LIMITED AND SUBSIDIARIES

SUPPLEMENTAL DATA SCHEDULE
     
Three Months Ended

March 31,
2013

   

March 31,
2012

 
Room Statistics for Macau Operations:
Occupancy %

93.8%

91.3%

Average Daily Rate (ADR)1 $ 315 $ 324
Revenue per available room (REVPAR)2 $ 296 $ 296
 
Other information for Macau Operations:
Table games win per unit per day3 $ 25,550 $ 24,337
Slot machine win per unit per day4 $ 809 $ 871
Average number of table games 494 490
Average number of slot machines 843 927
 
Room Statistics for Las Vegas Operations:
Occupancy %

82.9%

79.3%

Average Daily Rate (ADR)1 $ 258 $ 255
Revenue per available room (REVPAR)2 $ 214 $ 202
 
Other information for Las Vegas Operations:
Table games win per unit per day3 $ 8,519 $ 7,436
Table Win %

26.7%

22.8%

Slot machine win per unit per day4 $ 215 $ 198
Average number of table games 233 221
Average number of slot machines 2,187 2,391
 

(1) ADR is Average Daily Rate and is calculated by dividing total room revenue including the retail value of promotional allowances (less service charges, if any) by total rooms occupied, including complimentary rooms.

(2) REVPAR is Revenue per Available Room and is calculated by dividing total room revenue including the retail value of promotional allowances (less service charges, if any) by total rooms available.

(3) Table games win per unit per day is shown before discounts and commissions.

(4) Slot machine win per unit per day is calculated as gross slot win minus progressive accruals and free play.

Wynn Resorts, Limited
Samanta Stewart, 702-770-7555
investorrelations@wynnresorts.com

Products
  • Globe Unlimited

    Digital all access pass across devices. subscribe

  • The Globe and Mail Newspaper

    Newspaper delivered to your doorstep. subscribe

  • Globe2Go

    The digital replica of our newspaper. subscribe

  • Globe eBooks

    A collection of articles by the Globe. subscribe

See all Globe Products

Advertise with us

GlobeLink.ca

Your number one partner for reaching Canada's Influential Achievers. learn more

The Globe at your Workplace
Our Company
Customer Service
Globe Recognition
Mobile Apps
NEWS APP
INVESTING APP
Other Sections