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Wynn Resorts Reports a 4th Qtr Net Loss of $11.4 million; Opened Wynn Las Vegas
on Time and on Budget on April 28, 2005, Wynn Macau Expected
to Open in the 3rd Qtr 2006
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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. 

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Contact:

Wynn Resorts, Limited, Las Vegas
Samanta Stewart, 702-770-7555
investorrelations@wynnresorts.com
www.wynnresorts.com
www.wynnlasvegas.com

Also See: Wynn Resorts Ltd. Withdraws from Bidding for Gaming Resort Sites in Singapore; Company's Development Plate Full with Macau and Wynn Las Vegas Expansion / December 2005
Steve Wynn Planning Second Full-scale, $1.4 billion Megaresort Adjacent to the Wynn Las Vegas; Dubbed Encore, Will Have Over 2,000 Suites / March 2005

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