Wynn Resorts, Limited (NASDAQ:WYNN) reported financial results for the fourth quarter and year ended December 31, 2015.
Net revenues for the fourth quarter of 2015 were $946.9 million, compared to $1,138.0 million in the fourth quarter of 2014. The decline was the result of a 27.0% net revenue decrease from our Macau Operations, partially offset by a 3.8% increase in net revenues from our Las Vegas Operations. Adjusted property EBITDA (1) was $287.5 million for the fourth quarter of 2015, an 18.4% decrease from $352.5 million in the fourth quarter of 2014.
For the full year, net revenues were $4,075.9 million in 2015, down 25.0% from $5,433.7 million in 2014. Adjusted property EBITDA declined 33.1% to $1,185.8 million in 2015. Adjusted property EBITDA in 2015 decreased 43.7% to $708.6 millionat our Macau Operations and 7.4% to $477.2 million at our Las Vegas Operations.
On a US GAAP basis, net income attributable to Wynn Resorts, Limited for the fourth quarter of 2015 was $87.2 million, or$0.86 per diluted share, compared to $109.3 million, or $1.07 per diluted share, in the fourth quarter of 2014.
Adjusted net income attributable to Wynn Resorts, Limited (2) in the fourth quarter of 2015 was $104.1 million, or $1.03per diluted share, compared to $122.4 million, or $1.20 per diluted share, in the fourth quarter of 2014.
Wynn Resorts, Limited also announced today that the Company has approved a cash dividend for the quarter of $0.50per common share. This dividend will be payable on March 2, 2016, to stockholders of record on February 23, 2016.
In the fourth quarter of 2015, net revenues were $555.7 million, a 27.0% decrease from the $761.2 million generated in the fourth quarter of 2014. Adjusted property EBITDA in the fourth quarter of 2015 was $160.1 million, down 33.6% from$241.2 million in the fourth quarter of 2014.
Table games turnover in the VIP segment was $13.0 billion for the fourth quarter of 2015, a 36.9% decrease from $20.7 billion in the fourth quarter of 2014. VIP table games win as a percentage of turnover (calculated before commissions) for the quarter was 2.60%, below the expected range of 2.7% to 3.0% and below the 2.80% experienced in the fourth quarter of 2014. The average number of VIP tables decreased to 192 units in the fourth quarter of 2015 from 244 units in the prior year’s fourth quarter.
Commencing in the second quarter of 2015, the Company included the amount of cash that is deposited in a gaming table’s drop box plus cash chips purchased at the casino cage in the calculation of table drop in accordance with standard Macau industry practice. Table drop in the mass market segment was $1,185.5 million in the fourth quarter of 2015, down 10.9% from the 2014 fourth quarter. Table games win in the mass market segment decreased by 8.2% to $228.6 million in the fourth quarter of 2015. The mass market win percentage of 19.3% in the fourth quarter of 2015 increased from the 18.7% experienced in the fourth quarter of 2014.
Slot machine handle for the fourth quarter of 2015 declined 4.7% from the 2014 period to $1,069.3 million, and slot win decreased by 9.8% to $50.4 million.
For the fourth quarter of 2015, total non-casino revenues, before promotional allowances, decreased 21.2% during the quarter to $75.6 million. We achieved an average daily rate (“ADR”) of $323, down 2.7% compared to the $332 in the 2014 fourth quarter. Occupancy at Wynn Macau was 96.3%, down from 98.6% in the prior-year period. Revenue per available room (“REVPAR”) decreased 5.2% to $311 in the 2015 quarter from $328 in last year’s fourth quarter.
Las Vegas Operations
In the fourth quarter of 2015, net revenues were $391.2 million, a 3.8% increase from $376.8 million in the fourth quarter of 2014. Adjusted property EBITDA in the fourth quarter of 2015 was $127.4 million, up 14.5% from $111.2 million in the fourth quarter of 2014.
Net casino revenues in the fourth quarter of 2015 were flat at $170.9 million, compared to the fourth quarter of 2014 at$171.0 million. Table games drop of $485.7 million was down 24.0% from $639.0 million in the 2014 quarter. Table games win percentage was 28.7%, above the property’s expected range of 21% to 25% and above the 24.0% in the 2014 quarter. Slot machine handle of $730.7 million was 5.1% below the $769.8 million in the comparable period of 2014, and slot win was up 11.0% to $52.6 million.
For the fourth quarter of 2015, total non-casino revenues, before promotional allowances, increased 2.7% from the fourth quarter of 2014 to $263.0 million.
Room revenues increased 6.7% to $101.9 million during the quarter, versus $95.5 million in the fourth quarter of 2014. Occupancy decreased to 81.1% from 82.1% and ADR increased 7.7% to $292 from $271. REVPAR was $237 in the 2015 fourth quarter, 6.8% above the $222 reported in the prior-year quarter.
Food and beverage revenues in the fourth quarter of 2015 were $101.1 million, down 2.1% compared to the 2014 fourth quarter. Entertainment, retail and other revenues increased 4.5% to $60.0 million.
Wynn Palace Project in Macau
The Company is currently constructing Wynn Palace, a fully integrated resort featuring a 1,700-room hotel, a performance lake, and a wide range of amenities, including meeting, retail, food-and-beverage, and gaming space, in the Cotai area of Macau. In July 2013, we signed a $2.6 billion guaranteed maximum price (GMP) contract for the project’s construction. The total project budget, including construction costs, capitalized interest, pre-opening expenses, land costs and financing fees, is approximately $4.1 billion.
During the fourth quarter of 2015, we invested approximately $433.4 million in our Cotai project, taking the total investment to date to $3.5 billion.
Wynn Project in Massachusetts
In November 2014, we were awarded a gaming license to develop and construct an integrated resort in Everett, Massachusetts, adjacent to Boston. The resort will be located on a 33-acre site along the Mystic River. The resort will contain a hotel, a waterfront boardwalk, meeting space, a casino, a spa, retail offerings, and food-and-beverage outlets. During the fourth quarter of 2015, we began site remediation, site preparation and pre-construction activities.
Balance Sheet and Other
Our cash and cash equivalents and investment securities at December 31, 2015 totaled $2.3 billion.
Total debt outstanding at the end of the quarter was $9.2 billion, including $4.1 billion of Wynn Macau debt, $3.2 billionof Wynn Las Vegas debt and $1.9 billion of debt at the parent company and other.
During the 2015 year-end close process, the Company identified a $33.8 million decrease in the fair value of the Redemption Note, resulting in an increase to net income attributable to Wynn Resorts, Limited of $22.4 million that should have been recorded during the three months ended September 30, 2015. While the Company determined these amounts were immaterial, considering both quantitative and qualitative factors, it has elected to revise the amounts in the three months ended September 30, 2015, and will include disclosure of the adjustments in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. These non-cash amounts do not affect the Consolidated Statements of Operations for the year ended December 31, 2015 or adjusted property EBITDA, adjusted net income attributable to Wynn Resorts, Limited or adjusted net income per diluted share for the three months ended September 30, 2015 and December 31, 2015. (Original Source)
As of this writing, shares of Wynn Resorts are up nearly one percent in after-hours trading. WYNN has a 1-year high of $160.41 and a 1-year low of $49.95. The stock’s 50-day moving average is $62.25 and its 200-day moving average is $70.02.
On the ratings front, Wynn Resorts has been the subject of a number of recent research reports. In a report issued on January 26, Susquehanna analyst Rachael Rothman maintained a Hold rating on WYNN, with a price target of $61, which represents a slight upside potential from current levels. Separately, on January 15, Credit Suisse’s Joel Simkins maintained a Hold rating on the stock .
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Rachael Rothman and Joel Simkins have a total average return of -5.4% and 4.9% respectively. Rothman has a success rate of 42.3% and is ranked #2898 out of 3569 analysts, while Simkins has a success rate of 58.3% and is ranked #532.
The street is mostly Neutral on WYNN stock. Out of 7 analysts who cover the stock, 4 suggest a Hold rating and 3 recommend to Buy the stock. The 12-month average price target assigned to the stock is $72.00, which implies an upside of 23.2% from current levels.
Wynn Resorts Ltd is a developer, owner and operator of destination casino resorts. It owns and operates two destination casino resorts namely Wynn Las Vegas and Encore at Wynn Macau.