Wynn Resorts, Limited (WYNN) 8 Feb 232022 Q4 Earnings call transcript

Welcome to the Wynn Resorts Fourth Quarter 2022 Earnings Call. All participants are in a listen-only mode until the question-and-answer session of today’s conference. [Operator Instructions] This call is being recorded.

If you have any objections, you may disconnect at this time.

I will now turn the line over to Julie Cameron-Doe, Chief Financial Officer. ahead. go Please

and operator, everyone. Thank good you, afternoon,

or Frederic the Gullbrants, securities and and with on remind line Linda you may today want may those Holaday. Las under me Brian Billings, the safe Chen, come Coughlan, true. Ian forward-looking Craig that are are and Steve to laws, not may Also Jenny I On Vegas. call Luvisutto make Whiteman statements we in [ph] federal harbor statements

to Craig I turn will call over now Billings. the

Good Julie. joining and us. for Thanks, afternoon, thanks everyone,

we I note As that published looked an old EBITDA earnings. prepared QX The XXXX in our Vegas was was that $XXX at Wynn for this Las for expectation million. call, analyst after XXXX note

and and on adjusted Vegas of Vegas mind is stand-alone power. Here did our Vegas $XXX reducing million in The it by strip EBITDA, absolutely printed great in on and it to property and an Wynn best. a And share Las by confident did we years all-time XXXX. pandemic are three that normalized just Las team property. million. in not drive result Las operating $XXX focusing I'm leverage. programming, nickel the for standards this deliver we products, staff great service showed Great The service, it do Wynn market pricing this what we record and later team you, global diming crushed

quarter I'll in Vegas is outlook stronger more in in Vegas relevant fourth it moment. ever Our more in a talk business than has about the and been. our

signing Macau. three going quarantine, as proposed for of of in our the the part our that renewal believe And concession. our would proud the Macau the like I'd will Macau to December. And the plan fortunate for three programming other new required and their faith put ceremony and nearly I Turning thank to weeks significant events, business of us. we in to their the the then was like be attend additive for CapEx years. of that our forward reopening was on over we to I'm thank concession government very I there over I Macau through after touch and for dedication difficult the I to team to to past business the Wynn coming concession years. the importantly, in renewal like would several

us brighter. Fortunately, the actions give and Macau and authorities the recent difficulties behind Mainland the both great to that much there by future reopen are us confidence market near-term

back guests a past weeks, has an welcomed of way. Over and region increasing as travel the number we've in several the to reopened meaningful tourism

the are mass. drop In premium levels from to with positioned strong product mass spectrum and period. the Macau, Chinese core we mass post-COVID our New to strengths XXXX recent across New reached service Year play recovery premium our holiday were With of XX% evident well in the during the levels, lead table Chinese and casino, Year

January levels. incorrectly in who the VIP solely was In XXXX above that environment, organization. that despite New estimate direct of the VIP, GGR of believe define continue And expectations the we to our market Year importantly, during consistent Chinese all was turnover pre-COVID a XX% those are hold-normalized junket the changes month share we with levels focused

million New retail period, New On Year of increased sales onset since delivered compared Chinese our the of occupancy performance EBITDA day. EBITDA Year XX%, normalized XXXX. our the approximately side, hotel the tenant the $X Overall, pandemic, per non-gaming we and during was strongest XX% Chinese to

with difficult across $XXX We million above levels, XXXX retail, back in the entertainment all saw Las quarter Vegas. F&B, Turning The turned strength hotel, EBITDA. well at broad-based team despite a fourth Wynn and to QX Las casino, Vegas of year-over-year record comps.

and programming our and business in personal investment continue growth. sense team's of facilities of to deep Our our drive ownership people,

that strength experienced as trends encouraged forward-looking continue Vegas. Las economic quarters indicators despite We're pre-COVID-XX at macro to quite and have on monitor bookings Similarly, into strong well-known bookings at/or also over we forward higher remain room has are the ADRs. concerns our substantially continued Wynn pacing the QX. levels We past several above

the revenue, driven have day by we strength Like a with revenue quarters. and strong Turning January, strength in largely Vegas, past per and with to side first with quarter Boston. both the million EBITDA into strong The has the few with Encore gross We hotel $XX quarter, trends generating EBITDAR. on gaming casino experienced ADR occupancy. across non-gaming continued consistent saw the had of over record

sports were We day average little last retail first a the about week, over in daily XX% at which over the X.X handle Boston Harbor Encore at a days, million also betting Wynn of pleased to six is Las launch Vegas. averaging handle

also up days, than During we Rewards about XX% normal. signed those six more Wynn members

for We be to acquisition time. new continue customer to over the driver expect a significant book

for entertainment our street that also incremental across upcoming plans development property amenities. our advance and the We beverage include the and to project from food will parking, continue

flat. our burn in well-publicized a million single the that ticked rate us. quarter Interactive, bet, to up overall World bet Series Adjusted Wynn due for At $XX burn was that went EBITDA sequentially to roughly against

of of WynnBET We're potential driving the Our in launch efficiency. stay for for betting. while team upcoming with recently disciplined the retail a to online continues significant forward catalyst sports improved marketing looking book expected our and combination Massachusetts launched the on to cost

programming expect in are year. we resort, the planning The our in quickly publicly advancing months. also We're be more by and plans of and of will next middle Island, the spend confident foundation project. the Al I few the in our expect Wynn the Lastly, UAE. in we are over will of I we piles the time property for stages Marjan resort the market, for late share we more integrated we the for the driving programming renderings, that the

Julie to the it to over now additional run With turn through Julie? that, details on some I will quarter.

Thank you, Craig.

in million in quarter million QX. on million $XXX.X fourth EBITDA EBITDA quarter, operating $XXX.X generated $XX.X around lower-than-normal we impacted adjusted of negatively during record of revenue hold by Vegas, the property Las At a

in the Our quarter, year-over-year XX QX hotel basis was up points occupancy XXX basis versus and points XXXX. up XX.X%

Importantly, we've luxury and XXXX to to our on brand experience of XXXX record QX and $XXX versus ADR and with compete our product a QX reaching up overall stayed service QX XX% continued quality above XX.X% true levels. during XXXX,

which and well Our F&B, broad-based pre-pandemic also other retail, across and non-gaming businesses year-over-year up nicely strength saw above levels. entertainment were

guest our In levels, international despite XXXX play and during year-over-year suppressed was XX.X% in QX experience, slot X,XXX year-over-year increased above Similarly, adjusted job up a points table XX% XX.X% travel has Vegas compared above quarter was team property still impacting up the to the XXXX COVID-related our X.X% negatively XX% margin basis to great handle The drop in the without was margin quarter. costs of EBITDA a QX and approximately levels. QX controlling delivering XXXX XXXX. done On due hold-normalized our casino, QX challenges. of EBITDA basis, was the

gaming tax in to QX QX up in per excluding increase below million revenue. but operating was $X.X day XXXX well OpEx, XX% XXXX, levels the XX% compared

for December business. into closing to X, of before the the EBITDAR this Boston, point on sale adjusted following that property getting transaction leaseback we're the like out now reporting I'd details, In

generated we of broad-based quarter. nongaming strength In tables a of million we during strength adjusted EBITDA across property with saw property XXXX, In the QX We EBITDA and with casino casino, the $XXX margin record in $XX.X XX%. slots. and million both GGR, generated of

ADR. XX% $XXX by grew with revenue XX.X% a $XX.X particular nongaming record the hotels, Our a occupancy year-over-year and driven to million strength in

in very stayed per up million per on relative $X.XX a to million disciplined XXXX. We've side decrease tax the OpEx, with was XXXX excluding modestly QX cost XXXX. day QX X% of to over QX gaming This of in compared approximately day and $X.X

day beginning XXXX, with the a time. year. QX continue grow on line of leverage added As of to labor along as OpEx and we've last EBITDA a in prior calls, discussed were $XX,XXX by impacted million We're QX around our we to strong OpEx base, comps to nonrecurring which top benefit year-over-year positioned in late contractual agreements, the operating drive combination per well over $X

Lower operations million in delivered the by an around on EBITDA EBITDA Macau of million impacted $XX.X loss normal negatively million operating QX. in $XX than Our quarter revenues. of $XXX.X hold

region While QX, encouraged was we uptick and challenging visitation Chinese by in demand in the holiday period. during were as the we the recent the Craig noted, meaningful situation COVID during experienced

in excluding in was Our strong recovers a time. QX, approximately per well gaming OpEx, XXXX. QX operating done we costs are positioned difficult Longer million a in drive environment. million has as a day over $X remaining business the $X.X leverage on to operating tax, compared disciplined team to great job term, The decrease

shareholders advancing a our of balancing approvals carefully the the design stages, wide term. of terms responsibilities currently the position. in potential and process to of to new our these we liquidity number very of prudently, In approached a government We're tender the require projects range creating our commitments near CapEx but course, our the with concession, very government planning through and,

between As such, $XXX million. concession CapEx million related range XXXX, $XX for to to we commitments to our expect

to home of a Our future center. an non-gaming be innovative spectacle and show new entertainment including and food investments, center and set events unique halls

we shareholder as innovative introducing drive believe increased investments returns. these noted, a and non-gaming ultimately, we demonstrated play into strength our strong investments of track As tourism record Craig that have

Interactive. Turning Wynn to

QX XXXX. Our increased EBITDA million rate $XX.X burn in sequentially to

burn it flat However, $XX.X of rate with million. driving team that adjusting efficiencies. was QX costs mentioned, to for continues the bet well-publicized control our World marketing improved XXXX Series while Craig roughly The

sheet. the to balance on Moving

This liquidity total revolver revolving Macau $X.X These of facility the billion XX. entered billion December in U.S. exclude global with the $XXX $X.X remains numbers was very Resorts $XXX and with as Macau. available intercompany Wynn approximately into of strong million undrawn of of liquidity comprised Our in availability Wynn million credit position and cash and cash

close Encore proceeds on $X.X strong gross billion, We leaseback already with to liquidity the bolstering of position. estate transaction real were for December the Boston pleased our of X further sale Harbor

the very liquidity, our profile a the in Las leverage with adjusted of Importantly, Vegas with strong performance together XXXX and properties very property Boston, $X.XX generating billion U.S. the during healthy robust of creates in EBITDA combination

and performing of to markets domestic from our properties Wynn note upcoming XXXX, our bond I'd maturity With our balance million. each May to gross liquidity, intention reducing by Las sheet, well the like robust $XXX our our leverage our with repay in cash Vegas

With call $XX that, Finally, up now our normal maintenance. we'll Q&A. open course to the primarily CapEx to the was quarter in related million,

from [Operator Santarelli Instructions] Our question with comes Bank. Deutsche Carlo first

what Craig, know you're the you whoever holiday, a Macau bit on wants this kind that to take extent Year. you've Julie, I of in Chinese the and the comment kind to Craig, willing of little New would about kind following of of one. be weeks seen in To what saw aftermath kind you guys spoke the during great.

to want color Sure. Thanks, pretty a Frederic, do been actually. little that? good, want you more to It's take do provide you Carlo. -- on

Craig. you, Carlo. Thank Sure,

post with business to the We very, the than retail New seen see in we But typically see have Chinese a very mass remaining after better very have strong period the Year past. slowdown. past, encouraged period the direct sales gaming, similar in VIP and previously been does

of post we Year, that. business resilience Chinese encouraged So, the very with seen New have the I'm

Thank to you XX% said direct That's on in what what a you at there levels. Craig, That experience comment saw New Chinese And about, side. so. you been then, Great. has market all the VIP the talked today? whatever Can VIP bit as was or obviously, believe you is helpful. VIP above junket was you. the XXXX Year little with I

situation of the the Chinese There the changed Yes. New a has Year. lot junket some course Obviously, was period. from over pre-COVID activity

it's early call some market, and to the there little gaming the out activity. will bit certainly what role promoters think but actually was the in play I too a junkets

JPMorgan. Our next caller Greff with is Joe

back migrating what of mass -- maybe so you what into mass about premium you business? coming business do on How Since you saw of New on direct of Carlo's and you the you the in Years think migration your have -- what the been the yet? can quite not into junket following do Sort versus talk the in of otherwise is would think question, period. Chinese percentage then, component junket, VIP do the that

We I Remember, think you're to talking reopened now. too about into talking and be into credit percentages seeing extension. early mass is junket it's -- the certainly both, way migrate think really just January month given former there tricky direct. Joe, are about so on Xth, direct premium because market really it's customers fully I a

direct early. And Year competed quite results We had. pretty business. so strong. proves that came Chinese VIP back, The would period, too I of during to manage narrative the New that the false. unfortunately, What we're just a and how we're you the think, is it's in very proud to we I focused, say strongly be incredibly be volumes prudent have you came back little But volumes

XX% XXXX, we total that? look And that? the was when you around thought component of VIP something Are VIP back that in the you picking we in remind always us to fair of Can XX% direct turnovers.

You are.

You are.

That’s Okay. Thank all for you. me.

Kelley Bank caller with America. of is Shaun next Our

Just more in the it remarks, bit was from back $X.X Macau. things quarter the if in down Macau, Julie, margin million picture down were color little you think hoping to on get cost prepared a correctly, you maybe and start called the in I to a day in rebound fourth as around XXXX. $X mentioned I million in

put United together and to leverage out of we was I leaves sort mean, for going how think you're that may some certain amount in States, underappreciated in the I Macau. re-ramping, this as of around happen of tea really kind of Just all trying to operating the the markets play

any just expenses and begins here? on thoughts margins kind the recovery So as of

Sure. per We cash we with and million, We our in Yes, really which to manage hard year you're $X closed. while year worked did the talk down last to correct, $X.X day to million prior. were Shaun. OpEx down OpEx preserve from QX was

of representative moving things not be necessarily that's forward. obviously, will how So

and As you open staffing on. time know, and now we're so different in F&B outlets fully full

That's dependent. going margin very and in that we asked our focused centers of in on on We appropriately, very very, don't on we shakes brand, staff that tight it's outcome. delivery but accordingly. comes we to answer the We're our very mix the And It's we're terms service margin, much when really staffing. and much same It's back out pretty -- on mix business well. margin. to very focused manage really give of And where Vegas. the we're focused So, market. business doing manage about as our we're of terms very that on we're in in depend that

mass just mix it's add, a primarily would I And now.

COVID that's So, a of you're we -- the savings have cost which, God And thank behind period, we going maintain. that portion higher margin. inherently to long us, during the is will implemented

margin should the profile healthy. be So,

again, about weeks here. it's we're -- of a talking couple So really

start early a little it's forecasting to So, margins. bit specific

follow-up. the Understood. Great. And then just maybe

pretty just would Another thing about up in range. prepared Macau, came What that the that outcome could of I Can maybe wide talk dictate that and kind of the gave sort low? you outlook the CapEx discussed? or things was you in of remarks of underway you kind a some the high what that projects different versus impact either get the are think could the range of the

Sure.

strong that the we're obviously, very drive from returns to quickly that's So, I billion And years. concession commitment our think CapEx back, we've we OpEx. when committed think you just through to total a taking of But getting our -- about a as if $X.X mix on XX possible that's proposal, it. put focused over CapEx step as so and can done start we

that factor to need ground is break anything. we limiting The locally really and build the approval

That's our such we given our not getting perspective, everything, range our to why construction anything really approvals for go but through wide because towards it's government we've we're in a through have from that's pacing and D&D hands. related. So, designing

the we range $XXX million. was So, million gave $XX to

Thank you.

Our is with Jefferies. David Katz next caller

of This Hi. behalf on David. is Cassandra

discuss you whether to quarter, resorts. business nearly year? broke You profit digital was to even in the expect the the Can fourth -- excluding should we and launches this mentioned the that upcoming inflect

market and have of upcoming obviously, in -- we as other that will and would launch have the have Massachusetts, Boston that our expect a we -- that most markets. property I presence because The of upcoming competitors the Sure. is reasonable share Encore significant Harbor, hope where

strategy would inflection before, is business driving the user can for do burn as Massachusetts really, control. much hard make the good the iGaming, accretive ourselves under on at have while point, positioning point which long-term would this talked some user again, about I we as how we being land-based our well resorts. we late upon as to really are business really We expect and depending the prudent. acquisition of focused in And Massachusetts, but in XXXX, we money --

up. Great. thoughts any some If the weeks? may market your you now seen about capital maturity? to last activity in upcoming the I talk follow Can tapping since we And about few have

remarks pay just in cash to going sheet. Julie think I down mentioned the upcoming we're that maturity with prepared the balance our on

next Our UBS. Robin caller is with Farley

really chatter little holiday. I the wonder strong numbers There's more just circling trending back are to overall, the Year, than it New was how obviously a been seasonal. post in that drop-off the bit market Chinese through things

Is your of So, of I post it volatility you think for reasonable holiday? normal give be take seasonal would how maybe just that that. that sort or increased kind than I shoulder of more kind of on wonder if frame you could drop-off around guess, the to kind there'll periods, the

Hi Robin. Frederic Yes, that to, I'm performing what we drop-off during period. been been we've talking you've not that normally just sure see mentioned would above actually

didn’t say know down, could of about a if it EBITDA. just above, you you when But talked I that on overall was But wondering performing be expenses being so the... and your combination

No. He was business talking volumes.

Okay.

you your sort what's a assume market that share? that's take sounds in, volatility in take like In it that other maybe growth share you're of on that words, the period, would gaining So, on your this. but overall just market in then

It's it's a things, a right? the week, of week. In grand scheme

it's that, just during and New occupancy and expectations Anything shortly outperformed a lull read. read the side, on side, our week. the the market leaves direct side was would So, rager mass to any too on VIP side for retail I What Year, a that is it's beyond in the back, roared to it on hard the Macau thereafter. tea Chinese say period early the on

your a for off was to it seen you just it better meant sequential your 'XX but what that in clarify, specifically And better you'd just outperformed say were when than year? than what Okay. expectations, this you expectations drop or

The former.

is may Politzer, go you from Our question Daniel ahead, next Fargo. Wells

the I into it Is Week or periods? other wanted back mentioned. million there circle could I $X during you you put know any New EBITDA that in New Golden or on per Chinese historical that for to don't was XXXX Year what Chinese day way context, York

it would remember we've have quoted -- if don't it been Yes, I previously.

it's I not because disclosure. that million So, there certainly peak. of we to wasn't call prior prior you in a periods. where way, to it it's careful EBITDA contribution junket in that substantial year. of $XXX terms million -- not relative the want New this to Year. be But I'll put it, was, It's to Chinese $X normal And

that the think given really XXXX point remainder the beyond. in the is, it's and substantial and at opened us of gives January, number, confidence the I a market it beginning of

kind Understood. to of what resurface seen Vegas effectively Asia high-end Las And pivoting have I Vegas. just mean, extent China then, your business property? since to you is reopened, that

Too in early to [ph] drop quarter the box I was say. pretty fourth mean, our strong.

business. pretty that So, out out over back on folks -- here. those it box fact, we've COVID the been doing region in of sit And to sit chose [ph] well from the domestic

So again, a little bit early to say.

in You visitation arrange Latin and that the have visa, certainly, some only America. et through was from et international -- Europe is getting hope of see But it really to XXXX, only have real we inbound cetera, to that travel, go travel a was in given process XXXX tailwind in a the from to Vegas cetera. you

Operator, the last question next the one. will be

Morgan Grambling from comes Stephen our Stanley. And question with last

we I missed the provide guess, even of expectations quarter I just in out mix? relates particularly But not seeing, only may of Las convention but seeing the you're to over strong, of in you're what any should year, -- be bookings, kind forward additional on as Vegas, terms in what color it can course first as this. have the you and look any

comment. Sure. to I'll and then start, I'll ask Brian

how So in first our we've been and business have and we really over intentional foremost, Las past the year Vegas. approached

best relevant customers than ever before. is here business Our the more with

playbook environment with for any even we yet a interest outperformed, number from economic prices layoffs, XXXX And gas economic tailwinds, the we've have to the rates aware of we're of broader scenarios. so keenly to and

to about want more into talk on XXXX and then dig perhaps little view Brian, bit convention? your do you a

Absolutely.

has in forward were pace you excited As we of 'XX accelerated. look business. to I'm group, in best the got teams got we In When about coming 'XX, into going business. only the into we we've not strong Vegas, look at strong pacing assets the look in coming then the even particularly 'XX. got what got so it, we've we've as just 'XX, We've beyond. of 'XX and best out

QX done for a just be record well. us. may really It's

got new show pricing at kicked have And November. every channel. that in exciting. we coming FX the launched of are We 'XX notch really with got up with Awakening. power we kind We We've then in a several strong projects end, just in a things

now. So pending what looks our good impacts good. outlook can other year, no feeling We're macroeconomic we for pretty about right pretty the see

So strong. very group on side, the

We're really That's doing can well fact. control. We don't on a what economy. macro the control we

I here. that how flows, So, our we're know. about good don't But feeling business

sneak in if Macau. on enough. just can Fair I a quick Then follow-up

target the there think grow VIP thinking any you an that both Is business as to and customer? big maybe as you're grow? customers about way about that, who’re to opportunity. could market the how business, the a mass through way is VIP And used one of segment some how to to As frame in think that direct

is customer Every unique.

it's share wouldn't difficult. really had I a playbook, is strokes If it every And broad call. a on unique. so, customer I probably But public

comprised subsegment now, ability different, is us, to which of us junkets ecosystem customers. the of those the junket so, it and but promoters a gives And address

going figure those them, to years our to direct -- it's of Some out. take migrate portion to a they're But certainly, into will business. of going

Year. New Chinese over it saw You

migrate don't there's mass. a them talk we that playbook But into broad of can some think I swath will And premium about.

Thank look support all now that, Okay. today Wynn the and for Well, time your Resorts. We call. your close you we'll very to you soon. of forward with updating

everybody. Thanks,

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