Published Tuesday, May 5, 2009 | 7:33 a.m.
Updated Tuesday, May 5, 2009 | 9:41 a.m.
Wynn Resorts Financial Information
|2Q 2009||2Q 2008||% Change||1Q 2009|
|Revenue||$723.3 million||$825.2 million||-12.4%||$740 million|
|Net income||$25.5 million||$272 million||-90.6%||($33.8 million)|
|Net income per share||21 cents||$2.42||-98.7%||(30 cents)|
Wynn Resorts Ltd. today reported first-quarter losses and lower revenue over last year, but company executives say they’re cautiously optimistic that business is starting to pick up.
The Las Vegas-based company, which operates Wynn Las Vegas and Encore on the Strip and Wynn Macau in Asia, reported a loss of $33.8 million, 30 cents a share, on revenue of $740 million for the quarter ending March 31. That compared with earnings of $46.7 million, 41 cents a share, on revenue of $778.7 million in the same quarter a year ago.
The company attributed most of the falloff to an 8.7 percent decline in revenue at Wynn Macau. The property’s occupancy fell from 88.5 percent last year to 83.3 percent in 2009 and revenue per available room fell from $244 to $223. The company still plans to open the 400-suite Encore at Wynn Macau in May 2010.
In Las Vegas, net casino revenue in the first quarter was $117.5 million, compared with $125.1 million for the first quarter of 2008. Occupancy at the Wynn properties in Las Vegas was 89.5 percent for the quarter, compared with 95.8 percent in 2008, and revenue per available room fell from $285 to $199 in the same period.
Food and beverage revenue increased 25.6 percent to $96.9 million, primarily due to the opening of Encore, but retail sales were off 13.5 percent to $19.6 million because of reduced consumer spending.
Despite the weaker results, Wynn Chairman and CEO Steve Wynn said he was “cautiously optimistic that we have seen the bottom” of the tanking economy.
Wynn based his optimism on booking windows that have expanded since the middle of last year. He explained that the typical booking window is 70-90 days, but last year that dropped to around 30. But in April, he said it went back to 60-90.
“I’m still going to be a little reticent,” Wynn said in a conference call with investors this morning. “I think the economy is bounding around. I don’t know whether the stimulus package has taken effect or whether it is effective.”
He said he isn’t quite as ebullient as his competitors at MGM Mirage, who reported results Monday and expressed similar optimism.
“If (MGM Mirage executives) Jim Murren and Bobby Baldwin think it’s bottoming out, maybe it’s true. I hope it is,” he said.
Wynn said there also have been indications of a return to more traditional consumer behavior after months of sitting on the sidelines.
“People will resist change and want to go back to their normal behavior,” Wynn said. “They want to do what they always did.”
He cited recent weekends in Macau and Las Vegas that had robust activity and spending.
Wynn also said the company is starting to see some of the benefits of its cost-cutting measures on the bottom line, noting that the company took a “share-the-pain approach” by trimming salaries and bonuses instead of laying employees off.
Wynn also took time in the call to get political, urging President Obama to address travel and tourism issues and chiding inexperienced government officials for making statements that led to the downturn of travel to several U.S. cities, including Las Vegas. He praised Obama for his quick reaction to stimulating the economy, but said he needs to be more efficient in heading off the jobless rate.
“Consumer confidence a very important factor in the way people plan trips and meetings and travel,” Wynn said. “As long as people remain frightened, the money stays on the sideline.”
Wynn also downplayed reports that he is interested in acquiring the Bellagio from MGM Mirage. He said he would be a buyer only if the price and opportunity is right and that he hasn’t even made an offer for the property he built and gave up when MGM and Mirage Resorts merged in May 2000.
Wynn Resorts at a glance
+ Wynn Resorts operates the Wynn Las Vegas and Encore on the Las Vegas Strip and Wynn Macau in Asia.
- Encore opened in December so first-quarter 2008 results do not include those revenues and expenses.
- The average daily room rate for the quarter was $222 compared with $298 for the first quarter of 2008.
- In Las Vegas, net casino revenue in the first quarter was $117.5 million, compared with $125.1 million for the first quarter of 2008.
- In Macau, net revenue was $448.7 million compared with $491.5 million in the first quarter of 2008.
- Wynn stock hit 52-week lows March 2 ($17.65), March 3 ($16.93) and March 4 ($15.61).
+ May 4 stock price: $42.81 (52-week range: $14.50-$119.74)
With world-class dining, shopping, spas, golf and entertainment, there's no shortage of things to do at Wynn. The resort’s aquatic acrobatic show, “Le Reve—The Dream,” a creation by Cirque Du Soleil veteran Franco Dragone and Steve Wynn, will leave guests wanting more with its breathtaking performances that conjure an imaginary world. The Wynn Esplanade offers a unique shopping experience with stores including Chanel, Manolo Blahnik, Christian Dior, Oscar de la Renta and many more. Tryst is its signature nightclub, offering a secluded lagoon inside the club and spacious dance floor. Blush, the Wynn’s ultra lounge, draws swanky party-goers. Tryst, Wynn’s signature nightclub, is situated along a private lagoon under a 90-foot waterfall and plays host to some of the world’s most renown DJs.
Encore is nearly a mirror image of the Wynn Las Vegas, from the brown glass exterior to the style and placement of the logo — and it's just as luxurious as the original. Some call Encore the younger, hipper sister of Wynn.
Located steps from Wynn Las Vegas, yet under the same roof, Encore's fanciful and intimate atmosphere is unlike anything anywhere, with an environment that is uniquely Wynn and distinctly Encore.
Steve Wynn spared no detail in his newest property when designing Encore. The casino floor is decorated in rich reds, browns and purples with mosaic butterflies embedded into the marble floors and fresh flowers greeting guests in the casino atrium.
Luxury doesn't end of the casino floor. Encore boasts 2,034 impeccable guest rooms and suites. The standard suites resort accommodations are 700 square feet with the larger suites measuring in at 5,800 square feet. Standard suites guest rooms feature plasma screen TVs, high-end bath products, spectacular views of the Strip, and also plush linens and mattresses, which can be purchased in the Encore store, in case you can't get enough.
Dining options include Chef Theo Schoenegger's fine Italian cuisine at Chef Theo Schoenegger's, Sinatra's and the pan-Asian café creations of Chef Jet Tila at Wazuzu.
Guests can also dine on steaks and chops at star Botero Steak. At Switch, Encore's French restaurant, the walls come to life mid-meal and your surroundings appear to change before your eyes. For decadent, hip Asian dining before or after a night at one of resort’s ultra-chic nightclubs, visit Andrea’s, the newest dining experience at Encore.
XS headlines Encore's nightlife and pool party scene while Danny Gans takes care of humor and entertainment. Encore also features two of the most celebrated nightlife experiences in Vegas, XS Nightclub and Surrender. Both feature main room dance floors that flow outside to pools, patio spaces and gaming areas.
When the temperature rises, don’t miss Encore Beach Club, the premier daylife destination that features three tiered pools and luxurious cabanas and bungalows with private infinity pools.
Encore Esplanade features 11 high-end retail stores, with brands like Hermes, Chanel, Loro Piana and Rock, and Republic Piaget luxury watches. The resort also has a Forbes Five-Star spa, a salon and an 18-hole, on-site golf course, which is adjacent to the Wynn.