Wynn Resorts, Limited Reports Second Quarter Results
|
Wynn Resorts, Limited Reports Second Quarter Results
|
Category: North America & West Indies / Carribean islands
This is a press release selected by our editorial committee and published online for free on 2006-08-02
Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the quarter ended June 30, 2006.
Net Revenues for the quarter were $273.4 million and adjusted net loss (excluding $15.2 million in pre-opening expenses, property charges and increase in swap fair value) was $4.9 million, or $0.05 per share (adjusted EPS) (1). On a US GAAP (Generally Accepted Accounting Principles) basis, net loss was $20.1 million, or $0.20 per share.
Wynn Las Vegas Second Quarter Results
For the quarter ended June 30, 2006, Wynn Las Vegas generated adjusted EBITDA (2) of $73.2 million, representing a 26.8% margin on second quarter net revenues. The lower margins in the quarter resulted primarily from low hold percentage in the casino in June.
Net gaming revenues in the second quarter of 2006 were $113.5 million. Table games drop was $466.1 million, with win per table per day (before discounts) of $7,187 for the quarter. Table games win percentage of 19.8% was on the lower-end of the property's expected range of 19% to 22%. Slot machine win per unit per day was $240 on handle (volume) of $907 million in the quarter. Although slot handle maintained its pace with historical levels, win percentage was lower than in previous quarters (but within the normal expected range of 5% to 6%), resulting in the decline in win per unit per day for the quarter.
Gross non-gaming revenues for the quarter were $196.3 million, a 2.4% increase from the first quarter of 2006. Wynn Las Vegas' room revenues were $69.2 million with an Average Daily Rate (ADR) of $293 and occupancy of 95.7%, generating revenue per available room (REVPAR) of $280 for the period. Other non-gaming revenues for the second quarter of 2006 included food and beverage revenues of approximately $77.7 million, retail revenues of approximately $19.3 million, entertainment revenues of approximately $17.1 million, and other revenues from outlets, including the spa and salon, of approximately $13.0 million.
Wynn Macau
Wynn Macau is being constructed and will open in phases, with a total project budget of $1.2 billion. The first phase will open in September 2006 and will utilize approximately 11 acres of a total site area of 16 acres of land and features 600 hotel rooms and suites, approximately 210 table games and 380 slot machines in approximately 100,000 square feet of casino gaming space, seven restaurants, approximately 26,000 square feet of retail space, a spa, a salon, entertainment lounges and meeting facilities. The second phase will include approximately 135,000 square feet of additional casino space, one restaurant, retail space, a theater, and a dramatic front feature attraction. The second phase is expected to be completed and open to the public by the end of 2007.
The construction of Phase I of Wynn Macau is nearing completion and the majority of the areas has been finished and is being turned over to operations. Hotel room and banquet facility reservations are being accepted and online reservations can be made through www.wynnmacau.com. There are currently 3,500 employees on staff and the remaining 1,500 employees will start by the second week of August. The employees who are on staff are undergoing training by 250 supervisors who are leading the efforts. Several areas such as information technology, security and surveillance and the employee cafeteria, are fully functional.
As of June 30, 2006, the Company has incurred approximately $716.0 million of a total project budget of approximately $1.2 billion (including the expansion of the second phase).
We continue to make progress on our land concession discussions for a 54 acre site on Cotai in Macau and expect to finalize those discussions in the third quarter of 2006.
Encore at Wynn Las Vegas
We are constructing Encore at Wynn Las Vegas ("Encore") on approximately 20 acres on the Strip, immediately adjacent to Wynn Las Vegas. On March 31, 2006, our lenders approved the $1.74 billion project budget and the related plans and specifications for Encore. Encore includes a 2,042-room hotel tower fully integrated with Wynn Las Vegas, consisting of 132 suites and 1,910 guest rooms, as well as an approximately 54,000 square foot casino, additional convention and meeting space, as well as restaurants, a nightclub, swimming pools, a spa and salon and retail outlets. We commenced construction of Encore on April 28, 2006 and expect it to be completed by the end of 2008. The project budget for Encore includes approximately $70.0 million to be incurred for construction of a new employee parking garage on our Koval property, a related pedestrian bridge and costs to be incurred in connection with preparing the Broadway Theater to host "Monty Python's Spamalot." We expect "Monty Python's Spamalot" to begin performances at Wynn Las Vegas in the first quarter of 2007.
Other Factors Affecting Earnings
Depreciation and amortization expenses were $40.5 million during the second quarter. Interest expense, net of $8.6 million in capitalized interest, was $35.3 million for the second quarter of 2006. Pre-opening expenses, primarily related to Wynn Macau, totaled $17.0 million during the quarter. Corporate expenses and other was $11.5 million, including $2.9 million of stock option expenses.
Balance Sheet and Capital Expenditures
Our total cash balances at the end of the quarter were $833.5 million, including unrestricted cash balances of $379.0 million and cash balances restricted for our construction and development projects of $454.5 million. Total debt outstanding at the end of the quarter was $2.3 billion, including $224.7 million of Convertible Debentures and $306.0 million of Wynn Macau related debt. Capital expenditures during the second quarter of 2006, net of changes in construction payables and retention, totaled approximately $110 million, of which approximately $80 million was related to Wynn Macau and the remaining was mostly associated with Encore.
Conference Call Information
The Company will hold a conference call to discuss its results on Tuesday, August 1st, 2006 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).
|
|
