Wynn Resorts WYNNposted impressive results for first-quarter 2018, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings of $2.30 per share outpaced the Zacks Consensus Estimate of $1.96 by 19.4%. The bottom line also increased 79.7% on a year-over-year basis. This improvement can be attributed to substantial rise in operating income from Macau operations (Wynn Palace and Wynn Macau) and income tax benefit from U.
Wynn Resorts’ revenues of $1.72 billion exceeded the Zacks Consensus Estimate of $1.71 billion by 0.4%. The top line also improved 20.5%, given significant contribution from Wynn Palace, Wynn Macau and Las Vegas operations.
Concurrent with the earnings announcement, the company raised its quarterly cash dividend by 50% to 75 cents per share. The dividend will be payable May 29, 2018 to shareholders of record as of May 17.
Despite reporting better-than-expected quarterly results, the company’s shares decreased 2.9% in after-hours trading yesterday. The decline was primarily due dismal GAAP results. On a GAAP basis, Wynn Resorts incurred loss per share of $1.99 against income of 99 cents in the prior-year quarter due to litigation settlement expenses of $463.6 million and $69.3 million rise in the Redemption Note fair value.
However, in the past six months, the stock has surged 30.8% compared with the industry ’s increase of 12.4%.
Wynn Macau Revenues Increase Y/Y
Wynn Macau revenues were up 11.9% year over year to $618.2 million in the quarter, courtesy of higher casino and non-casino revenues.
Notably, casino revenues increased 10. 5% to $539 million. Table games turnover in the VIP segment surged 28.6% to $17.09 billion. However, the VIP table games win rate (based on turnover) was 2.61%, down 69 basis points (bps) year over year, and below the projected range of 2.7-3%.
Table drop in the mass market segment was $1.32 billion, up 16.4% year over year. Also, table games win in the mass market category amounted to $256.5 million, up 20.5%. Meanwhile, table games win percentage in mass market operations rose 19.4%, up 70 bps from the year-ago quarter.
Non-casino revenues improved 22.3% to $79.2 million. Room revenues were up 19% year over year at $28.4 million. Revenue per available room (RevPAR) also increased 21.5% in the quarter to $288 million. While, average daily rate (ADR) rose 17.8%, occupancy rate increased 330 bps to 99%.