| LAS VEGAS - Feb. 23, 2006 -- Wynn Resorts, Limited (Nasdaq: WYNN) today
reported financial results for the fourth quarter and year ended December
31, 2005.
Highlights from 2005
-
Successfully opened Wynn Las Vegas on time and on budget on April 28, 2005
-
Generated adjusted EBITDA (footnote 1) of $212.0 million at Wynn Las Vegas
for the 248 days the property was operating in 2005
-
Wynn Las Vegas generated win/table/day of $8,244, win/slot/day of $254,
and average daily rate of $274 since its opening
-
Continued construction of Wynn Macau on time and on budget
-
Refinanced the Macau Credit Facilities
-
Broke ground on the second phase of Wynn Macau
"2005 was a very important year for Wynn Resorts" said Steve Wynn, Chairman
and CEO. "We opened Wynn Las Vegas in April and have achieved great results.
We continue to work on Wynn Macau and look forward to having our second
property operating in the next seven months".
Net Revenues for the quarter were $269.4 million and adjusted net income
(excluding $16.5 million in pre-opening expenses and property charges for
Wynn Las Vegas, Wynn Macau and Encore) was $5.0 million or $0.05 per diluted
share (adjusted EPS)(2).
For the full-year 2005, Net Revenues were $722.0 million and adjusted
net income (excluding $111.2 million in pre-opening expenses and property
charges for Wynn Las Vegas, Wynn Macau and Encore) was $12.8 million, or
$0.13 per diluted share (adjusted EPS). On a US GAAP (Generally Accepted
Accounting Principles) basis, net loss for the quarter was $11.4 million,
or a net loss of $0.12 per diluted share, and net loss for 2005 was $98.4
million, or a net loss of $1.00 per diluted share.
Wynn Las Vegas Fourth Quarter Results
For the quarter ended December 31, 2005, Wynn Las Vegas generated adjusted
EBITDA of $80.1 million, representing a 29.7% margin on fourth quarter
net revenues.
Net gaming revenues in the fourth quarter of 2005 were $131.9 million.
Table games drop was $499.5 million, with win per table per day (before
discounts) of $8,842 for the period. Table games win percentage was 21.3%,
which is within the property's expected range of 18% to 22%. Slot machine
win per unit per day was $252 on handle (volume) of $882.7 million.
Gross non-gaming revenues for the period were $177.2 million and net
non-gaming revenues were $137.5 million. Wynn Las Vegas' room revenues
were $64.3 million. Average daily rate (ADR) was $278 and occupancy was
92.7%, generating revenue per available room (REVPAR) of $258 for the period.
The food and beverage, retail, entertainment and other operations generated
gross revenues of $64.4 million, $17.3 million, $19.5 million and $11.7
million, respectively.
Wynn Las Vegas Full year 2005 Operating Results
In the 248 days since its April 28th opening, Wynn Las Vegas generated
adjusted EBITDA of $212.0 million, representing a 29.4% margin on net revenues.
Net gaming revenues from April 28, 2005 to December 31, 2005 were $353.7
million. Table games drop was $1,275.4 million and table games win percentage
was 21.5%. Slot machine win per unit per day was $254 on handle (volume)
of $2,405.7 million.
Gross non-gaming revenues for the period were $469.2 million and net
non-gaming revenues were $368.3 million. Wynn Las Vegas' room revenues
were $170.3 million. Average daily rate (ADR) was $274 and occupancy was
92.1%, generating revenue per available room (REVPAR) of $253 for the period.
The food and beverage, retail, entertainment and other operations generated
gross revenues of $173.7 million, $51.2 million, $41.8 million and $32.2
million, respectively.
Wynn Macau
In June 2004, the Company broke ground on Wynn Macau, its destination
casino resort in Macau, China. The first phase of the project will utilize
approximately 11 of a total site area of 16 acres of land and includes
600 hotel rooms and suites, 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. We
expect the first phase to open to the public in the third quarter of 2006.
The second phase will include an additional 136,000 square feet of casino
space, two restaurants, retail, a theater, and a dramatic front feature
attraction. The second phase will be built on the remaining five acres
of the Wynn Macau site and will be integrated into the first phase of Wynn
Macau. The second phase is expected to be completed and open to the public
by the third quarter of 2007.
Construction of Wynn Macau is progressing on time and within budget
as the first phase is expected to open to the public in the third quarter
of 2006. Superstructure works are complete for the podium and tower. Certain
areas in the first phase of the project, namely retail and the information
technology data center, have been handed over to operations. Final design
work on the second phase is rapidly moving from the foundations to the
structure.
Wynn Macau will also add an additional 150 table games in the second
phase. The second phase will now include 300 table games taking the total
table count in the overall facility from 350 tables to 500 tables. The
addition to the casino in the second phase is expected to cost approximately
$70 million and is anticipated to be funded through bank facilities. The
second phase, including the additional 150 tables, remains on target to
open by the third quarter of 2007.
As of December 31, 2005, the Company has incurred approximately $427.2
million of a total project budget of approximately $1.2 billion (including
the expansion of the second phase), with approximately $748.4 million to
be spent to complete Wynn Macau.
Encore at Wynn Las Vegas
We have refined the design of Encore to currently feature a 2,054-room
hotel tower fully integrated with Wynn Las Vegas, consisting of 144 suites
and 1,910 guest rooms, as well as an approximately 44,000 square feet casino,
additional convention and meeting space, plus restaurants, nightclubs,
swimming pools, a spa and salon, and retail outlets. Once the Company has
finalized the budget and plans for Encore, it will seek the necessary approvals
from its Board of Directors and lenders. We expect Encore to open by the
end of 2008.
Other Factors Affecting Earnings
Interest expense, net of $5.4 million in capitalized interest, was $36.1
million for the fourth quarter of 2005. For the full year 2005, interest
expense was $99.5 million, net of $50.0 million in capitalized interest.
Depreciation and amortization expenses were $35.8 million, and pre-opening
expenses, primarily related to Wynn Macau, totaled $8.3 million during
the quarter. For the full year, Depreciation and amortization expenses
were $103.3 million and pre-opening expenses were $96.9 million. Corporate
expense in the fourth quarter was $10.8 million, and $24.6 million for
the full year 2005.
The Company is evaluating the appropriate hedge accounting interpretation
under FAS 133 as it relates to $200.0 million of existing interest rate
swaps. Depending upon the final outcome of this research, net income for
2005 may increase up to $5.0 million.
Balance Sheet and Capital Expenditures
Our total cash balances at the end of the quarter were $876.9 million,
including unrestricted cash balances of $434.3 million and restricted cash
balances of $442.6 million. Total debt outstanding at the end of the quarter
was $2.1 billion, including $250 million of Convertible Debentures and
$78.9 million of Wynn Macau related debt. Capital expenditures during the
fourth quarter of 2005, net of changes in construction payables and retention,
totaled $121.8 million, of which $83.1 million was related to Wynn Macau.
WYNN RESORTS, LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
-------------------- --------------------
2005 2004
2005 2004
--------- ---------- --------- ----------
Operating revenues:
Casino
$131,899 $- $353,663
$-
Rooms
64,290 -
170,315 -
Food and beverage
64,433 -
173,700 -
Entertainment, retail and
other
48,522 -
125,230 195
--------- ---------- --------- ----------
Gross revenues
309,144 -
822,908 195
Less promotional
allowances
(39,724) - (100,927)
-
--------- ---------- --------- ----------
Net revenues
269,420 -
721,981 195
Operating costs and
expenses:
Casino
59,407 -
155,075 -
Rooms
16,271 -
44,171 -
Food and beverage
42,487 -
118,670 -
Entertainment, retail and
other
31,220 -
80,185 68
General and administrative 45,789
36 121,618 335
Provision for doubtful
accounts
5,564 -
16,206 -
Pre-opening costs
8,324 28,779 96,940
81,321
Depreciation and
amortization
35,839 3,252 103,344
6,979
Property charges and other 8,144
(10) 14,297 1,290
--------- ---------- --------- ----------
Total operating
costs
and expenses
253,045 32,057 750,506
89,993
Equity in income from
unconsolidated affiliates
617 -
1,331 -
--------- ---------- --------- ----------
Operating income (loss)
16,992 (32,057) (27,194) (89,798)
--------- ---------- --------- ----------
Other income/(expense):
Interest income
7,635 3,658 28,267
8,633
Interest expense, net
(36,066) (2,154) (99,491) (2,687)
Loss on early
extinguishment of debt
- (97,160)
- (122,788)
--------- ---------- --------- ----------
Other income
(expense),
net (28,431) (95,656)
(71,224) (116,842)
--------- ---------- --------- ----------
Minority interest
- -
- 1,054
--------- ---------- --------- ----------
Net loss
$(11,439) $(127,713) $(98,418) $(205,586)
========= ========== ========= ==========
Basic and diluted earnings
per common share:
Net loss:
Basic
$(0.12) $(1.37) $(1.00)
$(2.37)
Diluted
$(0.12) $(1.37) $(1.00)
$(2.37)
Weighted average common
shares outstanding:
Basic
98,494 93,433 98,308
86,778
Diluted
98,494 93,433 98,308
86,778
WYNN RESORTS, LIMITED AND SUBSIDIARIES
RECONCILIATION
OF NET LOSS AND NET LOSS PER SHARE TO
ADJUSTED NET LOSS AND ADJUSTED NET LOSS PER SHARE
(In thousands)
(Unaudited)
Three Months Ended
Year Ended
December 31
December 31
----------------------- -----------------------
2005 2004
2005 2004
----------- ----------- ----------- -----------
Net income / (loss) $(11,439)
$(127,713) $(98,418) $(205,586)
Pre-opening costs
8,324 28,779
96,940 81,321
Property charges and
other
8,144 (10)
14,297 1,290
Adjusted net income /
(loss)
$5,029 $(98,944) $12,819
$(122,975)
Per diluted share of
common stock
Net loss
$(0.12) $(1.37) $(1.00)
$(2.37)
Pre-opening costs
0.08 0.31
0.99 0.94
Property charges and
other
0.08 (0.00)
0.15 0.01
Adjusted net income /
(loss)
$0.05 $(1.06)
$0.13 $(1.42)
Weighted average
diluted common
shares outstanding 98,494,421
93,432,556 98,307,788 86,777,567
WYNN RESORTS, LIMITED AND SUBSIDIARIES
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA
(In thousands)
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
-------------------- --------------------
2005 2004
2005 2004
--------- ---------- --------- ----------
Net loss
$(11,439) $(127,713) $(98,418) $(205,586)
Add/(Deduct):
Minority interest
- -
- (1,054)
Interest income
(7,635) (3,658) (28,267) (8,633)
Interest expense, net
36,066 2,154 99,491
2,687
Loss on early
extinguishment of debt
- 97,160
- 122,788
--------- ---------- --------- ----------
Total
28,431 95,656 71,224
116,842
--------- ---------- --------- ----------
Operating loss
16,992 (32,057) (27,194) (89,798)
Add/(Deduct):
Preopening expenses:
Wynn Las Vegas
27 14,418 67,454
41,073
Wynn Macau
8,197 4,920 20,402
15,970
Corporate and other
100 9,441 9,084
24,278
Depreciation and
amortization:
Wynn Las Vegas
33,115 1,502 94,297
3,793
Wynn Macau
1,969 1,347 6,429
1,704
Corporate and other
755 403
2,618 1,482
Property charges and
other:
Wynn Las Vegas
8,144 100 14,183
1,290
Wynn Macau
- -
- -
Corporate and other
- (110)
114 -
Corporate expenses and
other
10,768 -
24,620 -
--------- ---------- --------- ----------
Total
63,075 32,021 239,201
89,590
--------- ---------- --------- ----------
Wynn Las Vegas adjusted
EBITDA (1)
$80,067 $(36) $212,007
$(208)
========= ========== ========= ==========
WYNN RESORTS, LIMITED AND SUBSIDIARIES
SUPPLEMENTAL DATA SCHEDULE
Three Months Ended April 28, 2005 to
December 31, 2005 December 31, 2005
-------------------------------------
Room Statistics for
Wynn Las Vegas:
Occupancy %
92.7%
92.1%
Average Daily Room
Rate (ADR)(1)
$278
$274
Average Paying Rate (APR)(2)
273
264
Revenue per available room
(REVPAR)(3)
258
253
Other information:
Table games win per unit
per day(4)
$8,842
$8,244
Table Hold %
21.3%
21.5%
Slot Machine win per unit
per day(5)
$252
$254
Average number of table games
131
134
Average number of slot machines
1,950
1,955
(1) ADR is Average Daily Rate and is calculated by dividing
total room
revenue by total rooms occupied.
(2) APR is Average Paying Rate and is calculated by dividing
cash room
revenue by cash rooms occupied.
(3) REVPAR is Revenue per Available Room and is calculated
by dividing
total room revenue by total rooms
available.
(4) Table games win per unit per day shown before discounts
and
commissions.
(5) Slot machine win per unit per day net of participation
fees and
progressive accruals. |
Forward-looking Statements
This release contains forward-looking statements regarding
operating trends and future results of operations. Such forward-looking
information involves important risks and uncertainties that could significantly
affect anticipated results in the future and, accordingly, such results
may differ from those expressed in any forward-looking statements made
by us. The risks and uncertainties include, but are not limited to, competition
in the casino/hotel and resorts industries, the Company's brief operating
history, the Company's dependence on existing management, levels of travel,
leisure and casino spending, general domestic or international economic
conditions, and changes in gaming laws or regulations. Additional information
concerning potential factors that could affect the Company's financial
results are included in the Company's Annual Report on Form 10-K for the
year ended December 31, 2004 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 its forward-looking
statements as a result of new information, future events or otherwise.
Non-GAAP financial measures
(1) Adjusted EBITDA is earnings before interest, taxes,
depreciation, amortization, pre-opening expenses, property charges, corporate
expenses, earnings or losses from unconsolidated affiliates and other non-operating
income and expenses. Adjusted EBITDA is presented exclusively as a supplemental
disclosure because management believes that it is widely used to measure
the performance, and as a principal basis for valuation, of gaming companies.
Management uses adjusted EBITDA as the primary measure of the operating
performance of Wynn Las Vegas and to compare the operating performance
of its properties with those of its competitors. The Company also presents
adjusted 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 supplemental performance measure to GAAP financial
measures. In order to view the operations of their casinos on a more stand-alone
basis, gaming companies, including Wynn Resorts, Limited, have historically
excluded pre-opening expense, property charges and corporate expense, which
do not relate to the management of specific casino properties from their
EBITDA calculations. However, adjusted EBITDA should not be considered
as an alternative to operating income as an indicator of operating 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 generally accepted accounting principles in the United States ("GAAP").
The Company has significant uses of cash flow, including capital expenditures,
interest payments, debt principal repayments and taxes, which are not reflected
in adjusted EBITDA.
(2) Adjusted net income (loss) and adjusted EPS are presented
exclusively as a supplemental disclosure 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 considered by many to be a better indicator on which to base expectations
of future results than income computed in accordance with GAAP.
Wynn Resorts' calculation of adjusted earnings, adjusted
EPS and adjusted EBITDA 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 loss and net loss per share to adjusted net loss and adjusted net
loss per share, and (ii) net loss to adjusted EBITDA. |
