Net revenues for the first quarter of 2013 were $1,378.7 million, compared to $1,313.5 million in the first quarter of 2012. The revenue increase was driven by 4.4% higher revenues from our Macau Operations coupled with a 6.6% increase in revenues from our Las Vegas Operations. Adjusted property EBITDA (1) was $451.1 million for the first quarter of 2013, up 15.5% compared to $390.7 million in the first quarter of 2012.
On a US GAAP basis, net income attributable to Wynn Resorts for the first quarter of 2013 was $203.0 million, or $2.00 per diluted share, compared to net income attributable to Wynn Resorts of $140.6 million, or $1.23 per diluted share in the first quarter of 2012. Adjusted net income attributable to Wynn Resorts in the first quarter of 2013 was $205.6 million, or $2.03 per diluted share (adjusted EPS) (2) compared to adjusted net income attributable to Wynn Resorts of $151.9 million, or $1.33 per diluted share in the first quarter of 2012. In the first quarter of 2013, EPS was based on 101.4 million diluted shares compared to 114.0 million diluted shares outstanding in the first quarter of 2012, largely due to the redemption of Aruze USA, Inc.’s 24.5 million shares on February 18, 2012.
Wynn Resorts also announced today that it has approved a cash dividend for the quarter of $1.00 per common share. This dividend will be payable on May 23, 2013, to stockholders of record on May 9, 2013.
Macau Operations
In the first quarter of 2013, net revenues were $992.1 million, a 4.4% increase from the $950.7 million generated in the first quarter of 2012. Adjusted property EBITDA in the first quarter of 2013 was $330.7 million, up 14.1% from $289.8 million in the first quarter of 2012.
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 $28.4 billion for the first quarter of 2013, a 15.3% decrease from $33.5 billion in the first quarter of 2012. VIP table games win as a percentage of turnover (calculated before discounts and commissions) for the quarter was 3.14%, which was higher than our expected range of 2.7% to 3.0% and the 2.59% experienced in the first quarter of 2012.
Table games win in the mass market category was $243.1 million during the period, a 13.6% increase from $214.0 million in the first quarter of 2012. Mass market table games win percentage (calculated before discounts) of 35.5% was higher than the 30.3% generated in the 2012 quarter. Note that customers purchase mass market gaming chips at either the gaming tables or the casino cage. Chips purchased at the casino cage are excluded from table games drop and will increase the expected win percentage.
Slot machine handle was $1.1 billion for the first quarter of 2013, a 23.4% decline compared to the prior year quarter. Win per unit per day was 7.1% lower at $809, compared to $871 in the first quarter of 2012.
We achieved an Average Daily Rate (ADR) of $315 for the first quarter of 2013, 2.7% below the $324 reported in the first quarter of 2012 while the property’s occupancy was 93.8%, compared to 91.3% during the prior year period, and revenue per available room (REVPAR) was $296 in the 2013 quarter, which was flat with the first quarter of 2012. Gross non-casino revenues decreased 0.9% during the quarter to $105.3 million from $106.3 million in the prior year quarter.
We currently have 503 tables (288 VIP tables, 205 mass market tables and 10 poker tables) and 834 slot machines.
Cotai
The Company is constructing a full scale integrated resort containing a casino, hotel, convention, retail, entertainment and food and beverage offerings on the Cotai land and currently estimates the project budget to be in the range of $3.5 billion to $4.0 billion. The Company expects to enter into a guaranteed maximum price contract for the project construction costs in the first half of 2013. We started foundation work in February 2013 and expect to open our resort in Cotai during the first half of 2016.
During the first quarter of 2013, we spent approximately $76.3 million on our Cotai project.
Las Vegas Operations
For the first quarter ended March 31, 2013, net revenues were $386.6 million, a 6.6% increase from the first quarter of 2012. Adjusted property EBITDA of $120.4 million was up 19.3% versus the $100.9 million generated in the comparable period in 2012. EBITDA margin on net revenues was 31.1% in the first quarter of 2013 compared to 27.8% in the first quarter of 2012.
Net casino revenues in the first quarter of 2013 were $176.3 million, up 11.8% from the first quarter of 2012. Table games drop of $668.9 million was up 2.2% compared to $654.5 million in the 2012 quarter and table games win percentage of 26.7% was higher than the property’s expected range of 21% to 24% and above the 22.8% reported in the 2012 quarter. Slot machine handle of $696.6 million was 3.1% below the $718.9 million in the comparable period of 2012 and net slot win was down 1.7% to $42.3 million.
Gross non-casino revenues for the quarter were $256.4 million, 1.6% higher than in the first quarter of 2012 due to increases in hotel and food and beverage, which were partially offset by lower entertainment revenues.
Room revenues were up 4.8% to $91.5 million during the quarter, versus $87.4 million in the first quarter of 2012. Average Daily Rate (ADR) was up 1.4% to $258 while occupancy of 82.9% was higher than the 79.3% experienced in the first quarter of 2012. Revenue per available room (REVPAR) was $214 in the 2013 quarter, 6.0% above the $202 reported in the prior year quarter.
Food and beverage revenues increased 6.0% to $115.4 million primarily due to the strength in our restaurant, night club and beach club businesses. Retail revenues were $19.7 million in the quarter, down 0.9% from last year’s quarter. Entertainment revenues were down 28.3% due to a show that ended its run at the Encore theater in November 2012.
Balance Sheet and other
Our total cash and investments at March 31, 2013 were $2.3 billion. Total debt outstanding at the end of the quarter was $5.8 billion, including $3.1 billion of Wynn Las Vegas debt, $749 million of Wynn Macau debt and $1.9 billion at the parent company.
Corporate expense was down $7.0 million as we incurred significant expenses associated with the redemption of the Aruze USA, Inc.'s shares during the first quarter of 2012.
Conference Call Information
The Company will hold a conference call to discuss its results on Thursday, April 25, 2013 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 statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those we express in these forward-looking statements, including, but not limited to, our dependence on existing management, results of regulatory or enforcement actions and probity investigations, pending or future legal proceedings, uncertainties over the development and success of new gaming and resort properties, adverse tourism trends, general global macroeconomic conditions, changes in gaming laws or regulations, volatility and weakness in world-wide credit and financial markets, and our substantial indebtedness and leverage. 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, 2012 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 or revise 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, intercompany golf course and water rights leases, 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.
(2) Adjusted net income attributable to Wynn Resorts is net income before pre-opening costs, property charges and other, 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 (“adjusted 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.
The Company has included schedules in the tables that accompany this release that reconcile (i) net income attributable to Wynn Resorts to adjusted net income attributable to Wynn Resorts, and (ii) operating income to adjusted property EBITDA and adjusted property EBITDA to net income attributable to Wynn Resorts.
| |
|
||||||||||
| WYNN RESORTS, LIMITED AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
| (amounts in thousands, except per share data) | |||||||||||
| (unaudited) | |||||||||||
| |
|
|
|||||||||
| |
|||||||||||
| Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2013 | 2012 | ||||||||||
| |
|||||||||||
| Operating revenues: | |||||||||||
| Casino | $ | 1,106,503 | $ | 1,049,279 | |||||||
| Rooms | 120,480 | 117,503 | |||||||||
| Food and beverage | 139,701 | 135,140 | |||||||||
| Entertainment, retail and other | |
101,548 | |
|
105,909 | |
|||||
| Gross revenues | 1,468,232 | 1,407,831 | |||||||||
| Less: promotional allowances | |
(89,578 | ) | |
(94,333 | ) | |||||
| Net revenues | |
1,378,654 | |
|
1,313,498 | |
|||||
| |
|||||||||||
| Operating costs and expenses: | |||||||||||
| Casino | 697,188 | 674,656 | |||||||||
| Rooms | 33,390 | 29,984 | |||||||||
| Food and beverage | 73,873 | 70,396 | |||||||||
| Entertainment, retail and other | 40,326 | 51,658 | |||||||||
| General and administrative | 94,909 | 105,950 | |||||||||
| Provision for doubtful accounts | 7,004 | 18,064 | |||||||||
| Pre-opening costs | 452 | - | |||||||||
| Depreciation and amortization | 92,518 | 92,405 | |||||||||
| Property charges and other | |
5,346 | |
|
10,286 | |
|||||
| Total operating costs and expenses | 1,045,006 | 1,053,399 | |||||||||
| |
|||||||||||
| Operating income | |
333,648 | |
|
260,099 | |
|||||
| |
|||||||||||
| Other income (expense): | |||||||||||
| Interest income | 4,222 | 1,565 | |||||||||
| Interest expense, net of capitalized interest | (75,377 | ) | (62,061 | ) | |||||||
| Increase in swap fair value | 3,144 | 2,284 | |||||||||
| Loss on retirement of debt | - | (4,828 | ) | ||||||||
| Equity in income from unconsolidated affiliates | 200 | 465 | |||||||||
| Other | |
1,165 | |
|
768 | |
|||||
| Other income (expense), net | |
(66,646 | ) | |
(61,807 | ) | |||||
| |
|||||||||||
| Income before income taxes | 267,002 | 198,292 | |||||||||
| |
|||||||||||
| Benefit for income taxes | |
5,142 | |
|
117 | |
|||||
| |
|||||||||||
| Net income | 272,144 | 198,409 | |||||||||
| |
|||||||||||
| Less: Net income attributable to noncontrolling interest | |
(69,181 | ) | |
(57,845 | ) | |||||
| |
|||||||||||
| Net income attributable to Wynn Resorts, Limited | $ | 202,963 | |
$ | 140,564 | |
|||||
| |
|||||||||||
| |
|||||||||||
| Basic and diluted income per common share: | |||||||||||
| Net income attributable to Wynn Resorts, Limited: | |||||||||||
| Basic | $ | 2.02 | $ | 1.25 | |||||||
| Diluted | $ | 2.00 | $ | 1.23 | |||||||
| Weighted average common shares outstanding: | |||||||||||
| Basic | 100,237 | 112,704 | |||||||||
| Diluted | 101,373 | 114,008 | |||||||||
| |
|||||||||||
| Dividends declared per common share | $ | 1.00 | $ | 0.50 | |||||||
| |
|||||||||||
| |
|||||||||||
| |
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|
|
|
|||||||
| WYNN RESORTS, LIMITED AND SUBSIDIARIES | |||||||||||
| RECONCILIATION OF NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED | |||||||||||
| TO ADJUSTED NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED | |||||||||||
| (amounts in thousands, except per share data) | |||||||||||
| (unaudited) | |||||||||||
| |
|||||||||||
| |
|||||||||||
| Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2013 | 2012 | ||||||||||
| |
|||||||||||
| Net income attributable to Wynn Resorts, Limited | $ | 202,963 | $ | 140,564 | |||||||
| Pre-opening costs | 452 | - | |||||||||
| Increase in swap fair value | (3,144 | ) | (2,284 | ) | |||||||
| Property charges and other | 5,346 | 10,286 | |||||||||
|
Loss on retirement of debt |
- | 4,828 | |||||||||
| Adjustment for noncontrolling interest | |
20 | |
|
(1,455 | ) | |||||
| Adjusted net income attributable to Wynn Resorts, Limited(2) | $ | 205,637 | |
$ | 151,939 | |
|||||
| |
|||||||||||
| |
|||||||||||
| Adjusted net income attributable to Wynn Resorts, Limited per diluted share | $ | 2.03 | |
$ | 1.33 | |
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||||||||||||||
| WYNN RESORTS, LIMITED AND SUBSIDIARIES | |||||||||||||||||||||
| RECONCILIATION OF OPERATING INCOME TO ADJUSTED PROPERTY EBITDA | |||||||||||||||||||||
|
AND ADJUSTED PROPERTY EBITDA TO NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED |
|||||||||||||||||||||
| (amounts in thousands) | |||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||
| |
|||||||||||||||||||||
| Three Months Ended March 31, 2013 | |||||||||||||||||||||
|
Macau |
Las Vegas |
Corporate |
Total | ||||||||||||||||||
| |
|||||||||||||||||||||
| Operating income | $ | 251,526 | $ | 40,419 | $ | 41,703 | $ | 333,648 | |||||||||||||
| |
|||||||||||||||||||||
| Pre-opening costs | 452 | - | - |
|
452 | ||||||||||||||||
| Depreciation and amortization | 29,297 | 61,610 | 1,611 | 92,518 | |||||||||||||||||
| Property charges and other | 2,619 | 2,754 | (27 | ) | 5,346 | ||||||||||||||||
| Management and royalty fees | 39,196 | 5,795 | (44,991 | ) | - | ||||||||||||||||
| Corporate expense and other | 6,618 | 7,603 | 3,561 | 17,782 | |||||||||||||||||
| Stock-based compensation | 1,003 | 2,227 | (2,108 | ) | 1,122 | ||||||||||||||||
|
Equity in income (loss) from unconsolidated affiliates |
- |
(51 |
) |
251 | 200 | ||||||||||||||||
| |
|
|
|
||||||||||||||||||
| Adjusted Property EBITDA (1) | $ | 330,711 | |
$ | 120,357 | |
$ | - | |
$ | 451,068 | |
|||||||||
|
|
|
|
|||||||||||||||||||
| Three Months Ended March 31, 2012 | |||||||||||||||||||||
|
Macau |
Las Vegas |
Corporate |
Total | ||||||||||||||||||
| |
|||||||||||||||||||||
| Operating income | $ | 211,723 | $ | 20,426 | $ | 27,950 | $ | 260,099 | |||||||||||||
| |
|||||||||||||||||||||
| Depreciation and amortization | 28,288 | 63,418 | 699 | 92,405 | |||||||||||||||||
| Property charges and other | 6,568 | 3,718 | - | 10,286 | |||||||||||||||||
| Management and royalty fees | 38,059 | 5,451 | (43,510 | ) | - | ||||||||||||||||
| Corporate expense and other | 6,548 | 6,387 | 11,819 | 24,754 | |||||||||||||||||
| Stock-based compensation | (1,413 | ) | 1,371 | 2,690 | 2,648 | ||||||||||||||||
|
Equity in income from unconsolidated affiliates |
- | 113 | 352 | 465 | |||||||||||||||||
| |
|
|
|
||||||||||||||||||
| Adjusted Property EBITDA (1) | $ | 289,773 | |
$ | 100,884 | |
$ | - | |
$ | 390,657 | |
|||||||||
| |
|||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||
| March 31, | |||||||||||||||||||||
| 2013 | 2012 | ||||||||||||||||||||
| Adjusted Property EBITDA (1) | $ | 451,068 | $ | 390,657 | |||||||||||||||||
| |
|||||||||||||||||||||
| Pre-opening costs | (452 | ) | - | ||||||||||||||||||
| Depreciation and amortization | (92,518 | ) | (92,405 | ) | |||||||||||||||||
| Property charges and other | (5,346 | ) | (10,286 | ) | |||||||||||||||||
| Corporate expenses and other | (17,782 | ) | (24,754 | ) | |||||||||||||||||
| Stock-based compensation | (1,122 | ) | (2,648 | ) | |||||||||||||||||
| Interest income | 4,222 | 1,565 | |||||||||||||||||||
| Interest expense, net of capitalized interest | (75,377 | ) | (62,061 | ) | |||||||||||||||||
| Increase in swap fair value | 3,144 | 2,284 | |||||||||||||||||||
|
Loss on retirement of debt |
- | (4,828 | ) | ||||||||||||||||||
| Other | 1,165 | 768 | |||||||||||||||||||
| Benefit for income taxes | |
5,142 | |
|
117 | |
|||||||||||||||
| |
|||||||||||||||||||||
| Net income | 272,144 | 198,409 | |||||||||||||||||||
| |
|||||||||||||||||||||
| Less: Net income attributable to noncontrolling interest | |
(69,181 | ) | |
(57,845 | ) | |||||||||||||||
| |
|||||||||||||||||||||
| Net income attributable to Wynn Resorts, Limited | $ | 202,963 | |
$ | 140,564 | |
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|
WYNN RESORTS, LIMITED AND SUBSIDIARIES |
|||||||||
| SUPPLEMENTAL DATA SCHEDULE | |||||||||
| |
|
|
|||||||
| Three Months Ended | |||||||||
|
March 31, |
|
|
March 31, |
||||||
| |
|||||||||
| Room Statistics for Macau Operations: | |||||||||
| Occupancy % |
93.8% |
91.3% |
|||||||
| Average Daily Rate (ADR)1 | $ | 315 | $ | 324 | |||||
| Revenue per available room (REVPAR)2 | $ | 296 | $ | 296 | |||||
| |
|||||||||
| Other information for Macau Operations: | |||||||||
| Table games win per unit per day3 | $ | 25,550 | $ | 24,337 | |||||
| Slot machine win per unit per day4 | $ | 809 | $ | 871 | |||||
| Average number of table games | 494 | 490 | |||||||
| Average number of slot machines | 843 | 927 | |||||||
| |
|||||||||
| Room Statistics for Las Vegas Operations: | |||||||||
| Occupancy % |
82.9% |
79.3% |
|||||||
| Average Daily Rate (ADR)1 | $ | 258 | $ | 255 | |||||
| Revenue per available room (REVPAR)2 | $ | 214 | $ | 202 | |||||
| |
|||||||||
| Other information for Las Vegas Operations: | |||||||||
| Table games win per unit per day3 | $ | 8,519 | $ | 7,436 | |||||
| Table Win % |
26.7% |
22.8% |
|||||||
| Slot machine win per unit per day4 | $ | 215 | $ | 198 | |||||
| Average number of table games | 233 | 221 | |||||||
| Average number of slot machines | 2,187 | 2,391 | |||||||
| |
|||||||||
(1) ADR is Average Daily Rate and is calculated by dividing total room revenue including the retail value of promotional allowances (less service charges, if any) by total rooms occupied, including complimentary rooms.
(2) REVPAR is Revenue per Available Room and is calculated by dividing total room revenue including the retail value of promotional allowances (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 is calculated as gross slot win minus progressive accruals and free play.