From Nasdaq: 2025-02-13 23:30:14

Wynn Resorts held its Q4 2024 earnings call, reporting another record year of adjusted property EBITDAR. CEO Craig Billings highlighted positive changes and investments made in their businesses in Las Vegas, Boston, and Macau. The company is developing a new project in the UAE, aiming to diversify its business and increase free cash flow. Despite a decline in RevPAR during F1 week, the non-gaming business in Q4 remained strong. Looking ahead, Wynn Las Vegas is optimistic about 2025 with robust demand and upcoming investments to further strengthen their position in the market. Encore Boston Harbor reported nearly $59 million in EBITDA, with slot business strength and stable demand through January. In Macau, EBITDA was $293 million, down slightly year over year. Wynn Palace and Wynn Macau recently added digital tables for efficiency. Wynn is also making improvements in Macau with new gaming areas and food offerings. Construction is progressing on Wynn Al Marjan Island in the UAE. Wynn purchased Aspinalls in London to build brand awareness. Wynn Las Vegas generated $257.4 million in EBITDA. Wynn remains disciplined on costs and leveraged to capitalize on new market opportunities. Total capex spend in 2025 is expected to range between $250 million and $300 million. Wynn Resorts reports strong liquidity position with $3.5 billion in global cash and revolver availability. The company generated nearly $2.4 billion in adjusted property EBITDA in 2024, resulting in a consolidated net leverage ratio of just over four times. Shareholders approved a cash dividend of $0.25 per share and the company repurchased 2.14 million shares for $200 million in the quarter. Wynn Resorts also spent $127 million on capex and contributed $99 million of equity to the Wynn Al Marjan project. The company finalized a $2.4 billion financing package for the project, with plans to open in early 2027. Las Vegas experienced growth in January and February, with strong demand and cost management driving healthy margins. Macau remains stable and competitive, with a focus on EBITDA and margin. Wynn Resorts is focused on driving the best EBITDA results by modulating their reinvestment strategies. Premium customers outperformed base mass during Chinese New Year in Macau. The acquisition in London is a unique opportunity to establish a global presence. In Las Vegas, gaming volumes saw broad-based strength, indicating healthy demand. Wynn Al Marjan’s financing is complete, with topping off expected by the end of the year. Wynn Resorts is exploring big asset opportunities, as the U.S. regional gaming market faces challenges. Craig S. Billings, CEO of Wynn Resorts Limited, discusses the company’s substantial land bank in Al Marjan, Thailand, New York, and Las Vegas. The focus is on Wynn Al Marjan, a new $3 billion to $5 billion market. In Las Vegas, the timing must be right for growth, with an eye on not cannibalizing existing business. Despite tough comps, key volume metrics are up year over year in Vegas, with strong room bookings and retail sales. Wynn Resorts Limited would pursue opportunities in Thailand through a subsidiary. The company remains optimistic about its setup for 2025. Wynn Resorts reports great demand across all businesses with material improvements in sports offerings and services. CEO Craig Billings highlights the company’s focus on capital allocation, leveraging EBITDA to support stock buybacks. CFO Julie Cameron-Doe emphasizes comfortable leverage levels and fixed coupons relative to rates. Analysts inquire about buyback strategies and opex management in Vegas and Macau. Billings stresses long-term value over immediate market response, while discussing opex mitigation strategies and cost structures in both locations. The company remains committed to managing opex without damaging the brand while balancing buybacks with potential investments in new projects. Wynn Resorts CEO Craig S. Billings discusses liquidity and buyback plans, highlighting the company’s ability to take on new projects. The company is active in the market and has ample liquidity for potential investments. Renovations in Las Vegas will take place in the summer, with minimal disruption to guests. Room rates are tied to market trends, with strong pricing power in Q4 and Q1. Capex projects in Macau aim to bring in premium customers and contribute to long-term growth. The company’s commitment to $2.6 billion over the next 10 years includes significant capex investments. Wynn Resorts is seeking approvals for larger projects in Macau, focusing on maintaining the Wynn brand and IP. The company believes in the success of non-gaming amenities to drive visitation and long-term returns. In Macau, trends show that entertainment drives market share, which is reflected in Wynn’s concession-related capex plans. While specific ROI details are not disclosed, the company remains confident in revenue growth from these facilities.

The impact of FX on Wynn’s international customer base is minimal, with a strong emphasis on growing domestic business. The company is less reliant on international business than in the past, reducing exposure to FX fluctuations. Wynn’s diversified customer base, wealthier clientele, and strong domestic performance contribute to ongoing growth and success.

Wynn remains optimistic about its positioning in the UAE gaming market, with expectations of a healthy lead due to the timing of its opening in March 2027. The company believes not every Emirate will pursue gaming licenses, and the potential for a second license is uncertain. Wynn Al Marjan’s projections account for potential competition, but the company is confident in its first-to-market advantage and clustering effect benefits. Customer cohorts are a key focus for Wynn, targeting existing gamblers and new guests seeking hotel experiences and gaming opportunities. Marketing and distribution strategies are designed to attract and retain these important customer groups. Wynn Resorts CEO discusses global gaming industry dynamics, emphasizing the importance of supply and demand. The company believes its integrated resort in Ras Al Khaimah will attract high-value customers and drive substantial non-gaming revenues. With high propensity to spend on luxury in the Emirates and strong visitation numbers, Wynn Resorts is optimistic about its future prospects. The company expects to cater to inbound visitors, local residents, and destination luxury travelers, positioning itself as a key player in the global gaming market. The company remains bullish on its growth potential and revenue streams.



Read more at Nasdaq: Wynn Resorts (WYNN) Q4 2024 Earnings Call Transcript