- January 2014: low hold. January 2015: high hold %
- Q4 was tough; Golden Week in October was difficult (effects of changes in China have had a negative effect on top-end business)
- January 2015: no change in VIP business (volumes down hard). Occupancy was high. Rolex/Louis Vuitton suffered. Made $80m in Jan 2015 (made $70m in Jan 2014).
- Mass business in Jan 2015 was up 26%
- Opening in a week or so a new area dedicated to VIP business
- February should see an improvement of some sort
- Thousands of Wynn Macau employees expecting promotions and better lifestyle
- Wage Palace on budget and on time BUT builder last night said that because of a problem in timing of labor construction permits, it will not open before CNY 2016. So, Palace will open in the latter days of 1H 2016.
- China remains a big question mark
- Requested 1,000 additional laborers, got 700 laborers instead
- $515m in EBITDA in LV in 2014 encouraging
Q & A
- Smoking ban will be extended to VIP. Will have unintended consequences. However, WYNN has some open terraces that will mitigate some of that no smoking impact.
- Oct/Nov: low hold in premium mass area ($15m/$20m EBITDA impact)
- VIP hold was normal
- Tables will increase by 40 tables (combination of junket tables/mass tables) and will be ready before CNY 2015. Will be up to 485 tables in a couple of weeks.
- LV promos: nothing unusual
- Mass improvement in January 2015: Mainly mid to high end mass. Had been targeting 7,000 mid-mass players and the campaign has been very successful
- Boston budget: $1.7-$1.75bn
- $50m/month in revenues for the state of MA
- Another $50m/month for surrounding communities
- Financed at LIBOR + 175bps non-recourse
- Downturn is HK and Mainland China
- Capital Allocation: Always thought dividend would increase. Lots of cash protecting the dividend and big property opening in 2016
- No mass table reclassification
- Chinese people are cautious. There is uncertainty. Campaign against corruption has been a big wake up call.
- Have eliminated weaker junkets. Only will deal with strongest junkets (SunCity and Guangdong new to the property). Now do only with 9 junkets (12-13 junkets in the past).
- Mass promotional spending as higher % of revenues: not seeing in any major increase in promotional activity
- Wynn palace table count: 'common sense and integrity at end of day will be last word on subject'
- 2 projects facing Wynn LV: Old Frontier hotel (purchased by James Packer). Old Stardust hotel (purchased by Genting).
- Wynn sees these projects bringing more business to Vegas
- Raised Vegas pricing by 18% starting Labor Day
- Mass margins have been very consistent. Poor retail performance hurting mass margins since it has least income and highest margins.
- Overall EBITDA margins of low 30% target
- They need 1,500 more laborers to build the Wynn Palace. They have put the request in.