SEARCH NEWS:

 

Wynn Resorts, Limited Reports Q2 Results

LAS VEGAS -- (PRESS RELEASE) -- Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the second quarter ended June 30, 2005. Second quarter results include Wynn Las Vegas' first 64 days of operations.

Adjusted earnings (excluding $43.4 million in pre-opening expenses for Wynn Las Vegas, Wynn Macau, and Encore) were $8.2 million, or $0.08 per diluted share (Adjusted EPS) (1). On a US GAAP (Generally Accepted Accounting Principles) basis, net loss was $35.2 million, or a net loss of $0.36 per diluted share.

Wynn Las Vegas

On June 2, 2005, Wynn Resorts reported operating results for Wynn Las Vegas' first 34 days of operations. The property continued to perform strongly throughout June. For the first 64 days of operations, Wynn Las Vegas generated Net Revenues of $201.1 million.

Net gaming revenues for the period were $98.7 million. The slot segment produced net revenues of $34.2 million, with win per unit per day of $273. The table games segment generated net revenues of $62.0 million, representing win per table per day of $7,117 for the period. Table games win percentage was 21.1% (before discounts), which is within the property's expected range of 18 to 22%.

Since opening on April 28, 2005, Wynn Las Vegas' average daily rate (ADR) per room was $284 and occupancy of available guestrooms was 90.1%, generating revenue per available room (REVPAR) of $255 for the period. Gross non-gaming revenues for the period were $127.3 million and net non-gaming revenues were $102.4 million. The food and beverage, retail and entertainment operations generated gross revenues of $48.1 million, $16.9 million and $9.6 respectively.

Wynn Las Vegas generated adjusted EBITDA (2) of $58.7 million during the quarter, representing a 29.2% margin on net revenues. The adjusted EBITDA margin reflects high staffing levels and other costs related to the opening of Wynn Las Vegas. Wynn Las Vegas' pre-opening costs during the quarter were $36.9 million, including expenses associated with hiring and training employees, marketing expenses, and various other costs incurred prior to the property's opening on April 28, 2005. The pre-opening costs associated with the opening of Wynn Las Vegas are included in the $2.7-$2.75 billion project budget.

Steve Wynn, Chairman and Chief Executive Officer of Wynn Resorts commented, "The initial response from customers and employees has been very gratifying. In our first two months of operations, we achieved outstanding revenue numbers in various departments including slots, tables and retail. We deliberately and substantially overstaffed in order to offset our expected initial disadvantages in productivity: we had more than 9,000 employees working with approximately 58 newly integrated operating systems. In the upcoming months, our main focus will be on raising margins through increased operational efficiencies."

Wynn Macau

The Company broke ground for Wynn Macau in June 2004 and expects to open to the public in September 2006. Construction of Wynn Macau is progressing on schedule and within budget. Detailed interior design work continues, with the majority of architectural and structural design work now complete. Superstructure works are well underway with the hotel tower reaching the 23rd floor level. As of June 30, 2005, the Company had funded approximately $205.7 million of project costs and estimates that approximately $498.3 million will be spent to complete Wynn Macau.

Plans are also underway for a $345.0 million expansion. The Company expects construction of the expansion to commence in the third quarter of 2005, with completion slated for the first half of 2007. An increase in Wynn Macau's credit facilities to fund the development and construction of the expansion is expected to close in the third quarter of 2005.

Other Factors Affecting Earnings

Interest expense net of $10.5 million in capitalized interest was $26.3 million for the second quarter of 2005. Depreciation and amortization expenses were $26.1 million and pre-opening expenses totaled $43.4 million during the quarter, of which $4.1 million were related to Wynn Macau. Corporate expense in the quarter was $5.0 million.

Balance Sheet and Capital Expenditures

Unrestricted cash balances at June 30, 2005 were $485.8 million, while restricted cash balances were $592.0 million. Total debt outstanding at the end of the quarter was $2.0 billion, of which $250 million is our Convertible Debentures. Capital expenditures during the second quarter of 2005 totaled $268.2 million.

< Gaming News