Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial
results for the fourth quarter and year ended December 31,
2013.
Net revenues for the fourth quarter of 2013 were $1,519.9
million, compared to $1,289.1 million in the fourth quarter of
2012. The growth was driven by a 24.6% revenue increase from our
Macau operations and 2.4% higher net revenues from our Las Vegas
operations. Adjusted property EBITDA (1) was $498.4 million for the
fourth quarter of 2013, a 25.1% increase from $398.5 million in the
fourth quarter of 2012.
For the full year, net revenues were $5,620.9 million in 2013,
up 9.1% from $5,154.3 million in 2012. Adjusted property EBITDA
grew 14.9% to reach an annual record of $1,810.8 million in 2013, a
result of record annual performances at both Wynn Macau and Wynn
Las Vegas. For 2013, adjusted property EBITDA at Wynn Macau rose
13.4% to $1,324.1 million and increased 19.1% to $486.7 million at
Wynn Las Vegas.
On a US GAAP basis, net income attributable to Wynn Resorts for
the fourth quarter of 2013 was $213.9 million, or $2.10 per diluted
share, compared to a net income attributable to Wynn Resorts of
$111.4 million, or $1.10 per diluted share, in the fourth quarter
of 2012. Such figures for the full year were $728.7 million, or
$7.17 per diluted share, in 2013 and $502.0 million, or $4.82 per
diluted share, in 2012.
Adjusted net income attributable to Wynn Resorts (2) in the
fourth quarter of 2013 was $231.2 million, or $2.27 per diluted
share (adjusted EPS), compared to an adjusted net income
attributable to Wynn Resorts of $118.2 million, or $1.17 per
diluted share, in the fourth quarter of 2012. For the full year,
adjusted net income attributable to Wynn Resorts rose significantly
in 2013 to $776.8 million, or $7.64 per diluted share. This amount
compares to $558.4 million, or $5.36 per diluted share, in
2012.
Wynn Resorts also announced today that the Company has approved
a cash dividend for the quarter of $1.25 per common share. This
dividend will be payable on February 27, 2014, to stockholders of
record on February 13, 2014.
Macau Operations
In the fourth quarter of 2013, net revenues were $1,119.9
million, a 24.6% increase from the $898.7 million generated in the
fourth quarter of 2012. Adjusted property EBITDA in the fourth
quarter of 2013 reached a record $374.2 million, up 32.1% from
$283.2 million in the fourth 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 $34.4 billion for
the fourth quarter of 2013, a 23.9% increase from $27.7 billion in
the fourth quarter of 2012. VIP table games win as a percentage of
turnover (calculated before commissions) for the quarter was 2.92%,
within the expected range of 2.7% to 3.0% and below the 2.96%
experienced in the fourth quarter of 2012.
Table games win in the mass market segment increased by 34.6% in
the fourth quarter to $292.9 million. Mass market table games win
per unit per day increased by 22.5% to $14,552 from $11,875 in the
fourth quarter of 2012. Drop in the mass market segment was $691.8
million in the fourth quarter of 2013, down 1.1% from the December
2012 quarter, while the segment’s win percentage of 42.3% compares
to 31.1% in last year’s fourth quarter and sequentially to 38.0% in
the third quarter of 2013. 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. With the increased
purchases at the casino cage, we believe the relevant indicator of
volumes in the mass market segment should be table games win.
Slot machine handle of $1.4 billion for the fourth quarter of
2013 was 28.3% above the prior-year quarter, and slot win increased
26.8% compared to the prior-year period. Win per unit per day was
38.5% higher at $879, compared to $635 in the fourth quarter of
2012. The average number of slots in the 2013 fourth quarter
declined by 81 machines versus the 2012 period due to various
changes designed to enhance the comfort of the casino floor.
As of January 26, 2014, we have 513 tables (283 VIP tables, 220
mass market tables and 10 poker tables) and 866 slot machines at
Wynn Macau.
For the fourth quarter of 2013, we achieved an average daily
rate (ADR) of $315, modestly above the $314 reported in the 2012
fourth quarter. Occupancy at Wynn Macau of 96.7% compares to 96.5%
in the prior-year period, and revenue per available room (REVPAR)
rose 0.6% to $304 in the 2013 quarter from $303 in last year’s
fourth quarter. Gross non-casino revenues increased 3.9% during the
quarter to $108.5 million.
During the first half of 2013, we began a renovation of the
approximately 600 guestrooms in the original Wynn Macau tower,
resulting in an approximate 3% reduction in the number of available
room-nights in the 2013 fourth quarter versus the prior-year
period. We completed the guestroom renovation in mid-December.
Wynn Palace Project in Macau
The Company is currently constructing Wynn Palace, a full-scale
integrated resort containing a 1,700-room hotel, performance lake,
meeting space, casino, spa, retail offerings, and food and beverage
outlets on Cotai in Macau. In July 2013, we signed a $2.6 billion
guaranteed maximum price (GMP) contract for the project’s
construction. The total project budget, including construction
costs, capitalized interest, pre-opening expenses, land costs and
financing fees, is $4.0 billion. We expect to open our resort on
Cotai in the first half of 2016.
During the fourth quarter of 2013, we invested approximately
$184.9 million in our Cotai project, taking the total investment to
date to $704 million.
Las Vegas Operations
For the quarter ended December 31, 2013, net revenues were
$400.0 million, a 2.4% increase from $390.4 million in the fourth
quarter of 2012. Adjusted property EBITDA was $124.2 million, up
7.7% from the $115.3 million generated in the comparable period in
2012. EBITDA margin on net revenues rose to 31.0% in the fourth
quarter of 2013, from 29.5% in the fourth quarter of 2012.
Net casino revenues in the fourth quarter of 2013 were $202.3
million, a 12.1% increase from the fourth quarter of 2012. Table
games drop of $724.4 million was up 6.6% compared to $679.4 million
in the 2012 quarter. Table games win percentage was 28.8%, above
both the property’s expected range of 21% to 24% and the 26.8%
reported in the 2012 quarter. Slot machine handle of $731.9 million
was 3.5% below the $758.4 million in the comparable period of 2012,
while net slot win was down 6.3% due in part to lower hold in the
2013 quarter.
Room revenues were up 2.3% to $89.8 million during the quarter,
versus $87.8 million in the fourth quarter of 2012. Average daily
rate (ADR) modestly improved to $256 from $254, and occupancy
increased to 80.8% from 79.2% in the fourth quarter of 2012.
Revenue per available room (REVPAR) was $207 in the 2013 fourth
quarter, 3.0% above the $201 reported in the prior-year
quarter.
Food and beverage revenues in the fourth quarter of 2013 were
$98.1 million, down 11.7% from the 2012 fourth quarter primarily
due to declines in nightclub and catering revenues. Retail revenues
improved 6.9% from last year’s quarter to $23.6 million, a result
of reconfigurations to our retail area in the first half of 2013.
Entertainment revenues declined to $18.0 million in the 2013 fourth
quarter from $21.0 million due to a show that ended its run at the
Encore Theater in November 2012.
Balance Sheet and Other
Our total cash and investments balance at December 31, 2013 was
$2.9 billion. Total debt outstanding at the end of the quarter was
$6.6 billion, including $3.1 billion of Wynn Las Vegas debt, $1.5
billion of Wynn Macau debt and $1.9 billion at the parent company.
Note that, during the 2013 fourth quarter, Wynn Macau, Limited
issued $600.0 million of new 5.25% senior notes due in 2021.
Additionally, Wynn Las Vegas, LLC redeemed the remaining $225.3
million of its 7.875% first mortgage notes due in 2017.
Conference Call Information
The Company will hold a conference call to discuss its results
on January 30, 2014 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.
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, Limited is
net income before pre-opening costs, property charges and other,
and certain other non-operating income and expenses. Adjusted net
income attributable to Wynn Resorts, Limited and adjusted net
income per share attributable to Wynn Resorts, Limited (“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, Limited and adjusted net income
attributable to Wynn Resorts, Limited 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, Limited to adjusted net income attributable to Wynn
Resorts, Limited, and (ii) operating income to adjusted property
EBITDA and adjusted property EBITDA to net income attributable to
Wynn Resorts, Limited.
WYNN RESORTS, LIMITED AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except per share data) (unaudited)
Three Months Ended Year Ended December 31,
December 31, 2013 2012 2013 2012
Operating revenues: Casino $ 1,262,391 $ 1,019,249 $
4,490,637 $ 4,034,759 Rooms 119,299 117,965 492,230 479,983 Food
and beverage 125,198 135,592 586,672 588,437 Entertainment, retail
and other 108,967 108,811
418,705 417,209 Gross revenues 1,615,855
1,381,617 5,988,244 5,520,388 Less: promotional allowances
(95,958 ) (92,533 ) (367,308 ) (366,104 ) Net
revenues 1,519,897 1,289,084
5,620,936 5,154,284 Operating costs and
expenses: Casino 783,982 652,615 2,846,489 2,626,822 Rooms 32,483
31,334 133,503 126,527 Food and beverage 70,115 72,824 323,573
308,394 Entertainment, retail and other 46,497 45,185 175,257
189,832 General and administrative 116,472 120,187 448,788 441,699
Provision for doubtful accounts 4,773 12,023 11,877 18,091
Pre-opening costs 1,577 466 3,169 466 Depreciation and amortization
91,990 93,057 371,051 373,199 Property charges and other
3,567 3,431 17,138 39,978
Total operating costs and expenses 1,151,456
1,031,122 4,330,845 4,125,008
Operating income 368,441 257,962
1,290,091 1,029,276 Other
income (expense): Interest income 4,118 4,736 15,713 12,543
Interest expense, net of capitalized interest (76,332 ) (77,742 )
(299,022 ) (288,759 ) Increase (decrease) in swap fair value 1,104
(3,939 ) 14,235 991 Loss on extinguishment of debt (13,857 ) (660 )
(40,435 ) (25,151 ) Equity in income from unconsolidated affiliates
206 175 1,085 1,086 Other 471 2,076
4,856 3,012 Other income (expense), net
(84,290 ) (75,354 ) (303,568 ) (296,278
) Income before income taxes 284,151 182,608 986,523 732,998
Benefit (provision) for income taxes 6,335
(16,782 ) 17,634 (4,299 ) Net
income 290,486 165,826 1,004,157 728,699 Less: Net income
attributable to noncontrolling interests (76,602 )
(54,453 ) (275,505 ) (226,663 ) Net income
attributable to Wynn Resorts, Limited $ 213,884 $ 111,373
$ 728,652 $ 502,036 Basic and diluted
income per common share: Net income attributable to Wynn Resorts,
Limited:
Basic $ 2.12 $ 1.11 $ 7.25 $ 4.87 Diluted $ 2.10 $ 1.10 $ 7.17 $
4.82 Weighted average common shares outstanding: Basic 100,748
100,080 100,540
103,092 Diluted 101,807 101,122 101,641 104,249 Dividends
declared per common share $ 4.00 $ 8.00 $ 7.00 $ 9.50
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 Year Ended December
31, December 31, 2013
2012 2013 2012 Net
income attributable to Wynn Resorts, Limited $ 213,884 $ 111,373 $
728,652 $ 502,036 Pre-opening costs 1,577 466 3,169 466 Loss on
extinguishment of debt 13,857 660 40,435 25,151 (Increase) decrease
in swap fair value (1,104 ) 3,939 (14,235 ) (991 ) Property charges
and other 3,567 3,431 17,138 39,978 Adjustment for noncontrolling
interest (547 ) (1,625 ) 1,680
(8,263 ) Adjusted net income attributable to Wynn Resorts,
Limited(2) $ 231,234 $ 118,244 $ 776,839 $
558,377 Adjusted net income attributable to Wynn
Resorts, Limited per diluted share $ 2.27 $ 1.17 $
7.64 $ 5.36
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 December 31, 2013
Macau
Operations
Las Vegas
Operations
Corporate
and Other
Total Operating income $ 285,555 $ 47,981 $
34,905 $ 368,441 Pre-opening costs 1,577 - - 1,577
Depreciation and amortization 30,762 59,694 1,534 91,990 Property
charges and other 1,500 2,067 - 3,567 Management and royalty fees
44,445 6,001 (50,446 ) - Corporate expense and other 9,259 8,653
10,208 28,120 Stock-based compensation 1,116 (232 ) 3,582 4,466
Equity in income (loss) from
unconsolidated affiliates
- (11 ) 217 206
Adjusted Property
EBITDA (1) $ 374,214 $ 124,153 $ - $
498,367
Three Months Ended December 31,
2012
Macau
Operations
Las Vegas
Operations
Corporate
and Other
Total Operating income $ 206,374 $ 37,749 $
13,839 $ 257,962 Pre-opening costs 466 - - 466 Depreciation
and amortization 30,248 61,540 1,269 93,057 Property charges and
other 1,458 1,973 - 3,431 Management and royalty fees 36,094 5,856
(41,950 ) - Corporate expense and other 7,513 7,162 22,765 37,440
Stock-based compensation 1,043 1,044 3,857 5,944
Equity in income (loss) from
unconsolidated affiliates
- (45 ) 220 175
Adjusted Property
EBITDA (1) $ 283,196 $ 115,279 $ - $
398,475
Three Months Ended December
31, 2013 2012 Adjusted Property EBITDA
(1) $ 498,367 $ 398,475 Pre-opening costs (1,577 )
(466 ) Depreciation and amortization (91,990 ) (93,057 ) Property
charges and other (3,567 ) (3,431 ) Corporate expenses and other
(28,120 ) (37,440 ) Stock-based compensation (4,466 ) (5,944 )
Interest income 4,118 4,736 Interest expense, net of capitalized
interest (76,332 ) (77,742 ) Increase (decrease) in swap fair value
1,104 (3,939 ) Loss on extinguishment of debt (13,857 ) (660 )
Other 471 2,076 Benefit (provision) for income taxes 6,335
(16,782 ) Net income 290,486 165,826
Less: Net income attributable to noncontrolling interests
(76,602 ) (54,453 ) Net income attributable to Wynn
Resorts, Limited $ 213,884 $ 111,373
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)
Year
Ended December 31, 2013
Macau
Operations
Las Vegas
Operations
Corporate
and Other
Total Operating income $ 1,002,463 $ 167,050 $
120,578 $ 1,290,091 Pre-opening costs 3,169 - - 3,169
Depreciation and amortization 119,597 245,119 6,335 371,051
Property charges and other 5,003 12,162 (27 ) 17,138 Management and
royalty fees 160,923 23,721 (184,644 ) - Corporate expense and
other 28,593 32,026 28,110 88,729 Stock-based compensation 4,371
6,397 28,770 39,538
Equity in income from unconsolidated
affiliates
- 207 878 1,085
Adjusted Property
EBITDA (1) $ 1,324,119 $ 486,682 $ - $ 1,810,801
Year Ended December 31, 2012
Macau
Operations
Las Vegas
Operations
Corporate
and Other
Total Operating income $ 858,131 $ 74,027 $
97,118 $ 1,029,276 Pre-opening costs 466 - - 466
Depreciation and amortization 119,620 250,153 3,426 373,199
Property charges and other 10,382 29,563 33 39,978 Management and
royalty fees 147,101 22,318 (169,419 ) - Corporate expense and
other 29,177 26,809 56,173 112,159 Stock-based compensation 2,463
5,291 11,894 19,648
Equity in income from unconsolidated
affiliates
- 311 775 1,086
Adjusted Property
EBITDA (1) $ 1,167,340 $ 408,472 $ - $ 1,575,812
Year Ended December 31,
2013 2012 Adjusted Property EBITDA (1)
$ 1,810,801 $ 1,575,812 Pre-opening costs (3,169 ) (466 )
Depreciation and amortization (371,051 ) (373,199 ) Property
charges and other (17,138 ) (39,978 ) Corporate expense and other
(88,729 ) (112,159 ) Stock-based compensation (39,538 ) (19,648 )
Interest income 15,713 12,543 Interest expense, net of capitalized
interest (299,022 ) (288,759 ) Increase in swap fair value 14,235
991 Loss on extinguishment of debt (40,435 ) (25,151 ) Other 4,856
3,012 Benefit (provision) for income taxes 17,634
(4,299 ) Net income 1,004,157 728,699 Less:
Net income attributable to noncontrolling interests (275,505
) (226,663 ) Net income attributable to Wynn Resorts,
Limited $ 728,652 $ 502,036
WYNN RESORTS, LIMITED AND
SUBSIDIARIES
SUPPLEMENTAL DATA SCHEDULE
Three Months Ended Year Ended December
31, December 31, 2013
2012 2013 2012 Room
Statistics for Macau operations: Occupancy % 96.7 % 96.5 % 95.5 %
93.0 % Average Daily Rate (ADR)(a) $ 315 $ 314 $ 313 $ 315
Revenue per available room (REVPAR)(b)
$ 304 $ 303 $ 299 $ 293 Other information for Macau
operations: Table games win per unit per day(c) $ 28,663 $ 23,210 $
26,188 $ 23,654 Slot machine win per unit per day(d) $ 879 $ 635 $
777 $ 718 Average number of table games 492 486 491 489 Average
number of slot machines 874 955 866 941 Room Statistics for
Las Vegas operations: Occupancy % 80.8 % 79.2 % 84.6 % 82.9 %
Average Daily Rate (ADR)(a)
$ 256 $ 254 $ 258 $ 252
Revenue per available room (REVPAR)(b)
$ 207 $ 201 $ 218 $ 209 Other information for Las Vegas
operations: Table games win per unit per day(c) $ 9,849 $ 8,896 $
7,729 $ 7,031 Table Win % 28.8 % 26.8 % 25.1 % 21.9 % Slot machine
win per unit per day(d) $ 258 $ 225 $ 239 $ 206 Average number of
table games 230 222 233 220 Average number of slot machines 1,877
2,296 2,030 2,358
(a) 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.
(b) 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.
(c) Table games win per unit per day is shown before discounts
and commissions, as applicable.
(d) Slot machine win per unit per day is calculated as gross
slot win minus progressive accruals and free play.
Wynn Resorts, LimitedLewis Fanger, Vice
President702-770-7555investorrelations@wynnresorts.com
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