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Wynn Resorts Ltd. Reports Q4 Profit of $114.2 million, Compared to a
Loss of $5.2 million, in Q4 2009

Net revenue for Wynn Las Vegas and Encore Came in at $325.1 million, up 8%

LAS VEGAS--February 10, 2011--Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the fourth quarter and year ended December 31, 2010.

Net revenues for the year ended 2010 increased 37.4% to $4,184.7 million, compared to $3,045.6 million in 2009. The revenue increase was driven by a 59.1% increase in revenues at Wynn Macau and a 5.4% revenue increase from our Las Vegas operations. Adjusted property EBITDA (1) in 2010 increased 55.9% to $1,163.0 million, compared to $746.2 million for the year ended 2009. The EBITDA increase was driven by a 77.8% increase in EBITDA at Wynn Macau and a 10.7% EBITDA increase from our Las Vegas operations.

Net revenues for the fourth quarter of 2010 were $1,237.2 million, compared to $809.3 million in the fourth quarter of 2009. The revenue increase was driven by a 79.4% increase in revenues at Wynn Macau and an 8.0% revenue increase from our Las Vegas operations. Adjusted property EBITDA was $365.2 million for the fourth quarter of 2010, compared to $196.8 million in the fourth quarter of 2009.

On a US GAAP (Generally Accepted Accounting Principles) basis, net income attributable to Wynn Resorts for the year ended 2010 was $160.1 million, or $1.29 per diluted share, compared to net income attributable to Wynn Resorts of $20.7 million, or $0.17 per diluted share in 2009. Adjusted net income attributable to Wynn Resorts in 2010 was $261.0 million, or $2.11 per diluted share (adjusted EPS)(2) compared to an adjusted net income attributable to Wynn Resorts of $31.7 million, or $0.26 per diluted share in 2009.

On a US GAAP basis, net income attributable to Wynn Resorts for the fourth quarter of 2010 was $114.2 million, or $0.91 per diluted share, compared to a net loss attributable to Wynn Resorts of $5.2 million, or ($0.04) per diluted share in the fourth quarter of 2009. Adjusted net income attributable to Wynn Resorts in the fourth quarter of 2010 was $113.7 million, or $0.91 per diluted share (adjusted EPS)(2) compared to an adjusted net income attributable to Wynn Resorts of $10.3 million, or $0.08 per diluted share in the fourth quarter of 2009.

Wynn Macau Fourth Quarter Results

In the fourth quarter of 2010 net revenues were $912.1 million compared to $508.4 million in the fourth quarter of 2009. EBITDA in the fourth quarter of 2010 was $296.8 million, up 108.9% from $142.1 million in the fourth quarter of 2009.

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 $27.7 billion for the 2010 quarter, a 63.7% increase from $16.9 billion in the fourth quarter of 2009. VIP table games win as a percentage of turnover (calculated before discounts and commissions) for the quarter was 3.15%, above the expected range of 2.7% to 3.0% and the 2.7% experienced in the fourth quarter of 2009.

Table games drop in the mass market category was $663.3 million during the period, a 29.5% increase from $512.2 million in the fourth quarter of 2009. Mass market table games win percentage (calculated before discounts) of 26.0% was above our expected range of 19% to 21% and above the 22.9% generated in the 2009 quarter.

Slot machine handle increased 37.3% to $1.2 billion as compared to the prior year quarter. Win per unit per day was 72.3% higher at $608, compared to $353 in the fourth quarter of 2009.

Encore at Wynn Macau, with its intimate atmosphere and higher-limit tables, has been very well received by Wynn customers and has greatly contributed to the growth in revenues at Wynn Macau.

Wynn Macau achieved an Average Daily Rate (ADR) of $303 for the fourth quarter of 2010, compared to $271 in the 2009 quarter. The 2010 results include the addition of 414 rooms and villas with the opening of Encore on April 21, 2010. The property’s occupancy was 92.3%, compared to 90.6% during the prior year period and revenue per available room (REVPAR) was $280 in the 2010 quarter, 13.8% above 2009 levels of $246.

Gross non-gaming revenues at Wynn Macau increased 58.6% during the quarter to $92.6 million, driven primarily by hotel and retail revenues which were up 92.7% and 41.8%, respectively. Room revenues increased as a result of the addition of the Encore rooms and retail revenues benefited from strong same-store sales growth and the addition of three new boutiques at Encore.

Including Encore, we currently have 479 tables (243 VIP tables, 225 mass market tables and 11 poker tables) and 1,015 slot machines at Wynn Macau.

Wynn Las Vegas Fourth Quarter Results

For the fourth quarter ended December 31, 2010, net revenues for our Las Vegas operations were $325.1 million, which was 8.0% higher than in the fourth quarter of 2009. Property EBITDA of $68.3 million (with a 21.0% EBITDA margin on net revenue) was up 25.0% versus the $54.7 million generated in the comparable period in 2009, primarily due to higher gaming revenues.

Net casino revenues in the fourth quarter of 2010 were $139.2 million, up 16.0% from the fourth quarter of 2009. Table games drop was $564.8 million, compared to drop of $548.5 million in the 2009 quarter and table games win percentage of 22.5% was within the property’s expected range of 21% to 24% and above the 18.7% reported in the 2009 quarter. Slot machine handle of $698.1 million was 5.9% below the comparable period of 2009, however net slot win was up 2.1%.

Gross non-casino revenues for the quarter were $230.9 million, a 2.6% increase from the fourth quarter of 2009, driven primarily by higher revenues from our nightclub operations, specifically, the recently opened Surrender.

Room revenues were down 1.7% to $76.4 million during the quarter, versus $77.7 million in the fourth quarter of 2009. Even though Average Daily Rate (ADR) was up 7.1% to $235 and occupancy of 81.8% was slightly higher than the 81.0% for the fourth quarter of 2009, revenues declined as we had 9.0% fewer room nights available for sale during the quarter due to our remodel of the rooms at Wynn Las Vegas. This room remodel is expected to be completed in the second quarter of 2011.

Food and beverage revenues increased 6.4% to $98.0 million in the quarter as we opened the new Surrender nightclub in May 2010. Retail revenues were $22.0 million in the quarter, 5.1% below last year’s levels. Entertainment revenues increased 30.3% to $20.2 million from the fourth quarter of 2009 primarily due to the Garth Brooks performances (started in December 2009).

Other Factors Affecting Earnings

Interest expense was $59.7 million for the fourth quarter of 2010 compared to $50.5 million for the fourth quarter of 2009. Depreciation and amortization expense was $100.3 million during the quarter compared to $104.4 million for the three months ended December 31, 2009.

Balance Sheet and Capital Expenditures

Our total cash balances at December 31, 2010 were $1.3 billion. Total debt outstanding at the end of the quarter was $3.3 billion, including approximately $2.6 billion of Wynn Las Vegas debt and $651 million of Wynn Macau debt.

Capital expenditures during the fourth quarter of 2010, net of changes in construction payables and retention, totaled approximately $55 million primarily related to the Wynn Las Vegas room remodel.

Conference Call Information

The Company will hold a conference call to discuss its results on Thursday, February 10, 2011 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 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 dependence on existing management, levels of travel, leisure and casino spending, general economic conditions, and changes in gaming laws or regulations. 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, 2009 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 property EBITDA” is earnings before interest, taxes, depreciation, amortization, pre-opening costs, property charges and other, corporate expenses, 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.

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

(2) Adjusted net income (loss) attributable to Wynn Resorts is net income before pre-opening costs, property charges 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 (“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.


 
 

WYNN RESORTS, LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share data)

(unaudited)





 


Three Months Ended
Year Ended


December 31,
December 31,


2010   2009
2010   2009








 
Operating revenues:







Casino
$ 998,920

$ 591,758

$ 3,245,104

$ 2,206,829
Rooms

105,306


92,748


400,291


377,520
Food and beverage

119,512


106,068


488,108


436,361
Entertainment, retail and other
  98,524  
  84,328  
  354,332  
  288,432  
Gross revenues

1,322,262


874,902


4,487,835


3,309,142
Less: promotional allowances
  (85,074 )
  (65,573 )
  (303,137 )
  (263,531 )
Net revenues
  1,237,188  
  809,329  
  4,184,698  
  3,045,611  








 
Operating costs and expenses:







Casino

632,551


399,938


2,100,050


1,460,130
Rooms

28,897


28,891


122,260


111,596
Food and beverage

65,993


62,985


272,747


252,687
Entertainment, retail and other

56,739


46,954


204,558


166,636
General and administrative

105,555


101,242


391,254


365,070
Provision for doubtful accounts

13,575


727


28,304


13,707
Pre-opening costs

425


1,448


9,496


1,817
Depreciation and amortization

100,299


104,441


405,558


410,547
Property charges and other
  2,845  
  17,186  
  25,219  
  28,458  
Total operating costs and expenses

1,006,879


763,812


3,559,446


2,810,648








 
Operating income
  230,309  
  45,517  
  625,252  
  234,963  








 
Other income (expense):







Interest income

686


495


2,498


1,740
Interest expense, net of capitalized interest

(59,663 )

(50,524 )

(222,863 )

(211,385 )
Increase (decrease) in swap fair value

4,749


(1,270 )

(880 )

(2,258 )
Gain (loss) on extinguishment of debt/exchange offer

(623 )

(3,779 )

(67,990 )

18,734
Equity in income from unconsolidated affiliates

183


197


801


121
Other
  671  
  (17 )
  225  
  191  
Other income (expense), net
  (53,997 )
  (54,898 )
  (288,209 )
  (192,857 )








 
Income (loss) before income taxes

176,312


(9,381 )

337,043


42,106








 
(Provision) benefit for income taxes
  (4,438 )
  22,613  
  (20,447 )
  (2,999 )








 
Net income

171,874


13,232


316,596


39,107








 
Less: Net income attributable to noncontrolling interests
  (57,632 )
  (18,453 )
  (156,469 )
  (18,453 )








 
Net income (loss) attributable to Wynn Resorts, Limited
$ 114,242  
$ (5,221 )
$ 160,127  
$ 20,654  








 
Basic and diluted income (loss) per common share:







Net income (loss) attributable to Wynn Resorts, Limited:







Basic
$ 0.93

$ (0.04 )
$ 1.30

$ 0.17
Diluted
$ 0.91

$ (0.04 )
$ 1.29

$ 0.17
Weighted average common shares outstanding:







Basic

123,436


122,301


122,787


119,840
Diluted

124,899


122,301


123,939


120,185








 
Dividends declared per common share
$ 8.00

$ 4.00

$ 8.50

$ 4.00

 
 
 
 
WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO WYNN RESORTS, LIMITED

TO ADJUSTED NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED
(amounts in thousands)
(unaudited)








 


Three Months Ended
Year Ended


December 31,
December 31,


2010
2009
2010
2009








 
Net income (loss) attributable to Wynn Resorts, Limited
$ 114,242

$ (5,221 )
$ 160,127

$ 20,654
Pre-opening costs

425


1,448


9,496


1,817
(Gain) loss on extinguishment of debt/exchange offer

623


3,779


67,990


(18,734 )
(Increase) decrease in swap fair value

(4,749 )

1,270


880


2,258
Property charges and other

2,845


17,186


25,219


28,458
Adjustment for taxes on above

-


(7,486 )

-


(2,113 )
Adjustment for noncontrolling interest
  276  
  (636 )
  (2,689 )
  (636 )
Adjusted net income attributable to Wynn Resorts, Limited(2)
$ 113,662  
$ 10,340  
$ 261,023  
$ 31,704  








 








 
Adjusted net income attributable to Wynn Resorts, Limited per diluted share
$ 0.91  
$ 0.08  
$ 2.11  
$ 0.26  

 


 

WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED PROPERTY EBITDA

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

(amounts in thousands)

(unaudited)







 


Three Months Ended December 31, 2010


Wynn Las
Vegas

 

Wynn
Macau, Ltd.

 

Corporate and
Other


Total








 
Operating income (loss)
$ (13,412 )
$ 214,515
$ 29,206

$ 230,309








 
Pre-opening costs

425


-

-


425
Depreciation and amortization

64,466


35,237

596


100,299
Property charges and other

729


2,116

-


2,845
Management and royalty fees

4,878


36,142

(41,020 )

-
Corporate expense and other

8,686


7,347

8,646


24,679
Stock-based compensation

2,478


1,484

2,485


6,447

Equity in income from unconsolidated affiliates



96


-

87


183


 
 
 
 
Adjusted Property EBITDA (1)
$ 68,346  
$ 296,841
$ -  
$ 365,187  








 


Three Months Ended December 31, 2009


Wynn Las
Vegas


Wynn
Macau, Ltd.


Corporate and
Other


Total








 
Operating income (loss)
$ (56,664 )
$ 89,403
$ 12,778

$ 45,517








 
Pre-opening costs

346


1,102

-


1,448
Depreciation and amortization

80,079


23,611

751


104,441
Property charges and other

17,015


169

2


17,186
Management and royalty fees

4,563


20,279

(24,842 )

-
Corporate expense and other

8,076


6,265

7,993


22,334
Stock-based compensation

1,298


1,268

3,073


5,639

Equity in income/(loss) from unconsolidated affiliates



(48 )

-

245


197


 
 
 
 
Adjusted Property EBITDA (1)
$ 54,665  
$ 142,097
$ -  
$ 196,762  








 






Three Months Ended






December 31,






2010
2009
Adjusted Property EBITDA (1)




$ 365,187

$ 196,762








 
Pre-opening costs





(425 )

(1,448 )
Depreciation and amortization





(100,299 )

(104,441 )
Property charges and other





(2,845 )

(17,186 )
Corporate expenses and other





(24,679 )

(22,334 )
Stock-based compensation





(6,447 )

(5,639 )
Interest income





686


495
Interest expense, net of capitalized interest





(59,663 )

(50,524 )
Increase (decrease) in swap fair value





4,749


(1,270 )
Loss on extinguishment of debt





(623 )

(3,779 )
Other





671


(17 )
(Provision) benefit for income taxes




  (4,438 )
  22,613  








 
Net income





171,874


13,232








 
Less: Net income attributable to noncontrolling interests




  (57,632 )
  (18,453 )








 
Net income (loss) attributable to Wynn Resorts, Limited




$ 114,242  
$ (5,221 )

 


 

WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED PROPERTY EBITDA

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

(amounts in thousands)

(unaudited)







 


Year Ended December 31, 2010


Wynn Las
Vegas

 

Wynn
Macau, Ltd.

 

Corporate and
Other


Total








 
Operating income (loss)
$ (81,314 )
$ 604,443
$ 102,123

$ 625,252








 
Pre-opening costs

2,479


7,017

-


9,496
Depreciation and amortization

274,305


128,519

2,734


405,558
Property charges and other

19,017


6,038

164


25,219
Management and royalty fees

19,459


114,904

(134,363 )

-
Corporate expense and other

24,766


26,668

18,057


69,491
Stock-based compensation

11,278


5,097

10,793


27,168

Equity in income from unconsolidated affiliates



309


-

492


801


 
 
 
 
Adjusted Property EBITDA (1)
$ 270,299  
$ 892,686
$ -  
$ 1,162,985  


 


 







Year Ended December 31, 2009


Wynn Las
Vegas


Wynn
Macau, Ltd.


Corporate and
Other


Total








 
Operating income (loss)
$ (144,279 )
$ 315,017
$ 64,225

$ 234,963








 
Pre-opening costs

346


1,471

-


1,817
Depreciation and amortization

313,759


93,794

2,994


410,547
Property charges and other

24,468


2,478

1,512


28,458
Management and royalty fees

18,434


71,538

(89,972 )

-
Corporate expense and other

23,394


12,760

9,756


45,910
Stock-based compensation

8,370


5,029

10,937


24,336

Equity in income/(loss) from unconsolidated affiliates



(427 )

-

548


121


 
 
 
 
Adjusted Property EBITDA (1)
$ 244,065  
$ 502,087
$ -  
$ 746,152  








 






Year Ended






December 31,






2010
2009
Adjusted Property EBITDA (1)




$ 1,162,985

$ 746,152








 
Pre-opening costs





(9,496 )

(1,817 )
Depreciation and amortization





(405,558 )

(410,547 )
Property charges and other





(25,219 )

(28,458 )
Corporate expense and other





(69,491 )

(45,910 )
Stock-based compensation





(27,168 )

(24,336 )
Interest income





2,498


1,740
Interest expense, net of capitalized interest





(222,863 )

(211,385 )
Decrease in swap fair value





(880 )

(2,258 )
Gain (loss) on extinguishment of debt





(67,990 )

18,734
Other





225


191
Provision for income taxes




  (20,447 )
  (2,999 )








 
Net income





316,596


39,107








 
Less: Net income attributable to noncontrolling interests




  (156,469 )
  (18,453 )








 
Net income attributable to Wynn Resorts, Limited




$ 160,127  
$ 20,654  

 
 

WYNN RESORTS, LIMITED AND SUBSIDIARIES

SUPPLEMENTAL DATA SCHEDULE





 


Three Months Ended   Twelve Months Ended


December
31, 2010

 

December
31, 2009

 

December
31, 2010

 

December
31, 2009

Room Statistics for Las Vegas operations:

 


 
Occupancy %

81.8%

81.0%

88.0%

85.2%
Average Daily Rate (ADR)1
$ 235
$ 219
$ 210
$ 217
Revenue per available room (REVPAR)2
$ 192
$ 178
$ 185
$ 185








 
Other information for Las Vegas operations:







Table games win per unit per day3
$ 6,585
$ 5,188
$ 5,846
$ 5,099
Table Win %

22.5%

18.7%

22.2%

20.2%
Slot machine win per unit per day4
$ 179
$ 165
$ 164
$ 169
Average number of table games

210

215

224

226
Average number of slot machines

2,585

2,742

2,649

2,767








 
Room Statistics for Macau:







Occupancy %

92.3%

90.6%

87.8%

87.5%
Average Daily Rate (ADR)1
$ 303
$ 271
$ 291
$ 266
Revenue per available room (REVPAR)2
$ 280
$ 246
$ 256
$ 233








 
Other information for Macau:







Table games win per unit per day3
$ 24,769
$ 16,379
$ 20,563
$ 14,846
Slot machine win per unit per day4
$ 608
$ 353
$ 513
$ 386
Average number of table games

459

383

439

371
Average number of slot machines

1,127

1,190

1,167

1,195

(1) ADR is Average Daily Rate and is calculated by dividing total room revenue (less service charges, if any) by total rooms occupied.

(2) REVPAR is Revenue per Available Room and is calculated by dividing total room revenue (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 calculated as gross slot win minus progressive accruals and free play.



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



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