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In preparation for MPEL's 4Q earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.

MCE FINANCE LIMITED ANNOUNCES PRICING OF SENIOR NOTES OFFERING Jan 29

  • US$1,000 million aggregate principal amount of 5.00% senior notes due 2021 priced at 100.00% of par
  • Use of proceeds (i) to repurchase in full MCE Finance's US$600 million 10.25% senior notes due 2018 issued on May 17, 2010 and fund the related redemption costs, and (ii) the entire remainder of the net proceeds thereafter for the partial repayment of RMB2.3 billion (equivalent to US$364.9 million) 3.75% bonds due 2013 issued by Melco Crown Entertainment on May 9, 2011.

YOUTUBE FROM Q3 CONFERENCE CALL

  • "City of Dreams continues to maintain its market-leading mass market yields when compared to all other major mass-focused properties in Macau, while at the same time, it has delivered strong improvements in rolling chip table yields over the prior period."
  • "Altira Macau has also delivered substantially improved per table operating metrics compared to the previous quarter, which we are confident can be further built from here."
  • "Studio City is moving ahead on its expected timetable, with the majority of the piling and foundation work now complete. We have also recently engaged on a fixed price lump sum contract basis, our main contractor, providing us greater clarity and certainty around Studio City's design and construction costs. We remain on track to open this property around mid-2015."
  • [Manila] "With our current expected investment upon opening of both Phase 1 and 2 of the project expected to be around US$600 million, we believe this venture offers the company an opportunity to deliver strong returns on invested capital while also providing us with a platform for future expansion throughout Asia. We currently expect those Phases to open together by the first half of 2014."
  • "Total depreciation and amortization expense is expected to be approximately $90 million to $95 million. Corporate expense is expected to come in at $18 million to $20 million, and net interest expense on MCE's existing debt is expected to be approximately $23 million to $25 million."
  • "So heading into next year and hoping that some of the global headwinds like the European – people get used to the European debt crisis and there's less headwinds, and eventually, I think the Chinese leadership, they've had a very tight grip on the various sectors such as the real estate sector which has impacted asset prices. But once those things are behind and with the new leadership in place, I'm quite optimistic about next year."
  • "We feel no pressure in terms of the credit as well as the liquidity."
  • "We do need more rooms at City of Dreams, and Macau in general. We continue to believe it's a supply-driven market."
  • "City of Dreams, Phase 3, the additional tower – we're going through the formal government approvals because we have upgraded the building and included more amenities. So assuming it gets approved, we are hoping that we could get started on that project, probably the middle or the later half of next year."
  • "In terms of the yield on the VIP side... we are a little bit discount to the leading property at the moment. So I guess we have put plans in the optimizing process during the last three quarters in both Altira and CoD. This is a ongoing process, and we hope that we could be able to stabilize Altira at the moment, but we are still continuing to put the effort in CoD. So you will see some improvement in the next few quarters."
  • "We would love a dividend, but at the same time, I think the Board concluded that recently that we do want a very exciting development pipeline with Manila, Studio City, City of Dreams, Phase 3, to be on its way first....But I think for the next year, it's really about getting built-up on Studio City and Manila as quickly as possible and also getting City of Dreams Phase 3 started."
  • "In terms of the mass and VIP mix, I think it's a ongoing process and you'll see some margin-based improvement if we are doing this new performance in the next few quarters."
  • "In addition to the Studio City numbers that we've already discussed, we anticipate spending approximately $600 million in Manila upon opening. And as we said, we anticipate having $325 million of that funded through a local loan. So, you can back into our equity component there. And you're correct on Phase 3 of City of Dreams, that will be funded by cash and internally generated cash flow."