WYNN: Q2 WILL TELL A SIMILAR STORY

Now that we have the June Macau detail, we think Wynn Macau will beat the Street but Wynn Las Vegas will fall short.  Good thing this is essentially a Macau company.

We estimate WYNN will report Q2 revenue of $1.03BN and EBITDA of $261MM, exceeding rising consensus revenue and EBITDA numbers by 7% and 11% respectively.  Not surprisingly, we expect the beat to come from Macau and for Vegas to produce another uninspiring quarter. 

LAS VEGAS

We estimate that Wynn will report $313MM of net revenue and $62MM of EBITDA this quarter in Vegas. 

  • Net casino revenue of $132MM, non-gaming revenue of $235MM, and $45MM of promotional expenses.
  • RevPAR down 5% YoY.
  • Table drop flat with last year due to expected Baccarat share losses to MGM.  Unlike last quarter, Wynn has a more difficult hold comp.  In 1Q2010 Wynn’s tables held at 23.2% compared to 17.7% in 1Q2009.  Coupled with a 7% increase in table drop, Vegas table win produced a YoY increase of 40%.  Unfortunately, 2Q09 hold in Vegas was normal at 20.7% and therefore, we expect to see only flat to slightly down table win.
  • We project slot handle to be down around 10% YoY compared to a 27% YoY decline last quarter.  Encore opened Dec 22, 2008, so the first half of '09, especially 1Q2009, got a lot of traffic “checking out” the new product, making 1H09 a tough comp for Wynn compared to that of other strip properties.

MACAU

We estimate that Wynn’s Macau property will report $719MM of net revenue and $211MM of EBITDA. Good luck this quarter aided an already strong performance.

  • VIP win of $709MM.
    • We estimate $22.5BN of RC volume.
    • We estimate 14% of RC will come from direct play--up from 10% last quarter--due to Encore.
    • Hold of 3.15%.
  • Mass table win of $128MM (up 24%) and slot win of $49MM (+15%)
  • We assume rebates of $213MM (30% of win rate or 95bps) and all-in commissions of 41% vs. 39% in 1Q2010.