Yes, VIP hold was high at both Altira and City of Dreams but that was already in our numbers and should’ve been in the Street estimates as well. MPEL beat us everywhere on the volume side.



“Highlighting the ideal strategic positioning of our flagship property, City of Dreams, this premium-mass focused property once again captured meaningful market share in the mass market table games segment which, in turn, has been the major driver of our impressive group-wide performance in 2Q 2013...We continue to move forward with the fifth hotel tower at City of Dreams and anticipate to commence construction by the end of 2013. 

“Altira Macau also delivered robust sequential EBITDA growth in the second quarter of 2013, with increased rolling chip volumes and expanding table yields highlighting the success of our continual group-wide table yield optimization strategy...Our development pipeline continues to progress, with Studio City on-budget and on-track to open in mid-2015, while the timing of our Philippines Project remains unchanged and is expected to open around the middle of next year.


-Lawrence Ho, CEO of MPEL



  • COD's market-leading table yields are 20% higher than next best competitor's
  • House of Dancing Water show:  2MM patrons to date
  • Has gained RC share
  • RC/table productivity was up 30%
  • Mass - Ex SCC, market mass growth was 23%
  • MSC - Mid 2015 opening
  • Philippines: opening date mid-2014; $335MM equity raised incl exercise of over allotment option
  • CoD 5th tower:  will begin construction before end of 2013; prob will open end of 2016/2017
  • At end of June 2013, company is in net-cash position - can return capital to shareholders if the Board deems appropriate
  • 2Q Hold-adjusted EBITDA: $290MM
  • EBITDA contribution from non-VIP:  3/4 luck-adjusted EBITDA at COD, 2/3 luck-adjusted EBITDA on group wide basis.
  • 3Q non-operating guidance:  D&A $95-100MM; Corporate expense $20-22MM, Net interest expense $38-40MM ($10MM interest related to MSC, $11MM financed-leased interest related to Philippines)

Q & A

  • Margins:  good cost control; higher VIP hold and favorable VIP mix
  • Since 4Q 2012 (China leadership change), MPEL has been improving.  Weak macro data hasn't impacted operations. Lots of people who want to come to Macau.
  • MSC:  on schedule, on budget; govt very supportive of foreign labor quota
  • Dividends:  probably at the end of 2013
  • Have been lobbying in Japan/Taiwan
  • 2015 Subconcession renewal - not concerned; believes the six operators will stay put
  • CoD:  continue to focus on premium mass; improvements in hotels, F&B, casino; 
  • 2Q costs:  April 1 wage raise:  $4MM impact sequentially; a couple of MM related to utility cost; $1MM of Taboo costs
  • COD hotels:  has lengthened customers' days of stay;  optimization of hotel rooms based on quality of customers
  • COD hotel tower:  will take 3 years because it is the final piece of COD and it is 1.5MM sq ft; it is a complex structure that will be designed by a world-renown architect.

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