Wynn Resorts earns $127M in 3rd quarter
Thursday, October 20, 2011
LAS VEGAS (AP) — Casino operator Wynn Resorts Ltd. said Wednesday that its third-quarter net income was $127.1 million, compared with a loss of $33.5 million a year earlier when it paid off debt.
But its adjusted results fell short of Wall Street forecasts, and Wynn’s shares fell more than 5 percent after hours.
The company led by billionaire Chief Executive Steve Wynn credited a busy period in Macau, which is the world’s top gambling market and was the source of three-quarters of the company’s revenue.
Revenue in Macau climbed 41.7 percent to $951.4 million.
“Our bottom line keeps climbing,” Wynn told investors on a conference call.
The company said Wednesday that it earned $1.01 per share, compared with a loss of 27 cents per share a year earlier, when its results included a loss of $64.2 million due to paying off debt.
Its adjusted earnings of $1.05 per share fell short of Wall Street’s average estimate for $1.18 per share, according to data from FactSet. The company’s $1.3 billion in revenue, up from $1 billion a year earlier, was in line with analysts’ average estimate of $1.29 billion.
The shares fell $6.79 after hours after ending the day down $7.38, or 5.4 percent, at $130.27.
In Macau, Wynn said high rollers and regular customers gambled more on table games and slots, and the company’s hotels were fuller and more expensive to stay in.
The company did not update the timeline for its pending casino-resort project in Macau’s Cotai area, though Chief Financial Officer Matt Maddox said Wynn expects to work out the financing next year.
Steve Wynn said his company is mindful that government officials in Macau are very deliberate in allowing developers to plan and build casinos.
“You don’t get to rush it or change it. You live with it and you respect that process,” Wynn said. “We are encouraged, but we’re part of that choreography. We’re part of that schedule and that march to completion.”
Investors following the gambling industry have been salivating at the prospect of companies adding still more casinos in Macau, given high demand in the market. When asked whether demand in Macau might subside soon, Maddox said he thought gambling in the region was roughly one-third of the way toward its potential.
Wynn said its two casinos in Las Vegas generated revenue of $346.9 million, 3.7 percent more than they did during the third quarter last year.
But the company’s revenue from gambling in Sin City fell 8.3 percent to $126.9 million. Non-gambling revenue, which includes hotel rooms, restaurants, bars and other amenities at the company’s two resorts there, rose 11.1 percent to $265.9 million.
The company said it had $1.8 billion in cash and $3.1 billion in total debt as of the quarter’s end, Sept. 30. The company also declared a cash dividend of 50 cents per share for stockholders of record as of Nov. 2.
Wynn said the company is considering whether to build casinos in Florida and Massachusetts, should those states allow commercial casino gambling.
Wynn said he thought the Miami area could potentially become a gambling market worth $3 billion a year.
“Hopefully there will be a business opportunity there,” he said.
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