EX-99.1 2 d381498dex991.htm PRESS RELEASE PRESS RELEASE

Exhibit 99.1

Wynn Resorts, Limited Reports Second Quarter 2012

LAS VEGAS, July 17, 2012 (BUSINESS WIRE) — Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the second quarter ended June 30, 2012.

Net revenues for the second quarter of 2012 were $1,253.2 million, compared to $1,367.4 million in the second quarter of 2011. The revenue decline resulted from a 7.1% decrease in revenues from our Macau Operations and an 11.6% decline in our revenues in Las Vegas, as both properties were negatively impacted by lower hold in the 2012 quarter. Adjusted property EBITDA (1) was $384.1 million for the second quarter of 2012, compared to $447.0 million in the second quarter of 2011.

On a US GAAP basis, net income attributable to Wynn Resorts for the second quarter of 2012 was $138.1 million, or $1.37 per diluted share, compared to a net income attributable to Wynn Resorts of $122.0 million, or $0.97 per diluted share in the second quarter of 2011. Net income for the second quarter of 2011 included a $107.5 million charge representing the present value of a charitable contribution made by Wynn Macau.

Adjusted net income (2) attributable to Wynn Resorts in the second quarter of 2012 was $139.0 million, or $1.38 per diluted share (adjusted EPS) compared to an adjusted net income attributable to Wynn Resorts of $200.8 million, or $1.60 per diluted share in the second quarter of 2011. In the second quarter of 2012, we had 101.0 million diluted shares outstanding compared to 125.7 million diluted shares outstanding in the second quarter of 2011, largely due to the redemption of Aruze USA’s 24.5 million shares on February 18, 2012.

Wynn Resorts also announced today that the Company has approved a cash dividend for the quarter of $0.50 per common share. This dividend will be payable on August 14, 2012, to stockholders of record on July 31, 2012.

Macau Operations

In the second quarter of 2012, net revenues were $907.6 million, a 7.1% decrease from the $976.5 million generated in the second quarter of 2011. Adjusted property EBITDA in the second quarter of 2012 was $302.2 million, down 3.9% from $314.3 million in the second quarter of 2011.

Table games results in Macau are segregated into two distinct reporting categories, the VIP segment and the mass market segment.

Table games turnover in the VIP segment was $30.3 billion for the second quarter of 2012, a 7.2% decline from $32.7 billion in the second quarter of 2011. VIP table games win as a percentage of turnover (calculated before discounts and commissions) for the quarter was 2.79%, which was at the lower end of the expected range of 2.7% to 3.0% and lower than the 2.89% experienced in the second quarter of 2011.

Despite a 10.0% decrease in the number of mass market table games, drop in the mass market segment was down only 2.7%, from $690.3 million in the second quarter of 2011 to $671.8 million in the June 2012 quarter. Mass market table games win percentage (calculated before discounts) of 29.8% was higher than our expected range of 26% to 28% and above the 27.8% generated in the 2011 quarter.

Slot machine handle declined 22.1% to $1.2 billion as compared to the prior year quarter. Win per unit per day was 4.9% lower at $752, compared to $791 in the second quarter of 2011 as slot count went down by 114 machines.

We achieved an Average Daily Rate (ADR) of $317 for the second quarter of 2012, 1.0% above the $314 reported in the 2011 quarter. The property’s occupancy was 90.0%, compared to 90.5% during the prior year period, and revenue per available room (REVPAR) was $286 in the 2012 quarter, 0.4% above the $284 reported in the prior year quarter. Gross non-casino revenues increased 2.2% during the quarter to $96.7 million.

 

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We currently have 504 tables (290 VIP tables, 203 mass market tables and 11 poker tables) and 939 slot machines.

On May 2, 2012, Wynn Macau’s land concession contract was published in the official gazette of Macau. This concession contract has an initial term of 25 years with the right to renew it for additional successive periods, subject to government approval. The Company anticipates constructing a full scale integrated resort containing a casino, approximately 2,000 rooms and suites, convention, retail, entertainment and food and beverage offerings on this land. The Company currently estimates the project budget to be in the range of $3.5 billion to $4.0 billion.

Las Vegas Operations

For the second quarter ended June 30, 2012, net revenues were $345.6 million, an 11.6% decline from the second quarter of 2011. Adjusted property EBITDA of $81.9 million was down 38.3% versus the $132.7 million generated in the comparable period in 2011. EBITDA margin on net revenues was 23.7% in the second quarter of 2012 compared to 34.0% in the second quarter of 2011.

Net casino revenues in the second quarter of 2012 were $98.6 million, down 37.7% from the second quarter of 2011. Table games drop of $575.6 million was up 7.6% compared to $534.7 million in the 2011 quarter and table games win percentage of 15.0% was significantly below the property’s expected range of 21% to 24% and the 27.6% reported in the 2011 quarter. Slot machine handle of $707.8 million was 3.2% above the $685.6 million in the comparable period of 2011 and net slot win was flat due to lower hold in the 2012 quarter.

Gross non-casino revenues for the quarter were $290.7 million, 5.5% higher than in the second quarter of 2011 due to increases in the hotel and food and beverage segments, which were partially offset by lower retail and entertainment revenues.

Room revenues were up 5.6% to $96.2 million during the quarter, versus $91.1 million in the second quarter of 2011. Average Daily Rate (ADR) was up 5.6% to $254 while occupancy of 87.6% was below the 89.2% experienced in the second quarter of 2011. Revenue per available room (REVPAR) was $222 in the 2012 quarter, 3.8% above the $214 reported in the prior year quarter. During the second quarter of 2012, we had all rooms available for sale while 1.7% of the rooms in the second quarter of 2011 were out due to renovations.

Food and beverage revenues increased 9.8% to $138.4 million primarily due to the strength in the nightclub business. Retail revenues were $21.0 million in the quarter, down 8.0% from last year as we reconfigured the Encore retail area and are in the process of rebranding several retail outlets. Entertainment revenues declined 4.9% to $18.1 million from the second quarter of 2011.

Balance Sheet and other

During the quarter ended June 30, 2012, the company recorded an adjustment to its reserve estimates for casino accounts receivable based on the results of historical collection patterns and current collection trends. This change in estimate was the primary factor that resulted in a $17.3 million credit to the provision for doubtful accounts for the quarter ended June 30, 2012.

Total cash balance at June 30, 2012 was $1.9 billion. Total debt outstanding at the end of the quarter was $5.5 billion, including $3.1 billion of Wynn Las Vegas debt, $403.5 million of Wynn Macau debt and $1.96 billion at the parent company.

Conference Call Information

The Company will hold a conference call to discuss its results on Tuesday, July 17, 2012 at 1:30 p.m. PT (4:30 p.m. ET). Interested parties are invited to join the call by accessing a live audio webcast at http://www.wynnresorts.com (Investor Relations).

 

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Forward-looking Statements

This release contains forward-looking statements regarding operating trends and future results of operations. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by us. The risks and uncertainties include, but are not limited to, competition in the casino/hotel and resorts industries, the Company’s dependence on existing management, levels of travel, leisure and casino spending, general economic conditions, and changes in gaming laws or regulations. Additional information concerning potential factors that could affect the Company’s financial results is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and the Company’s other periodic reports filed with the Securities and Exchange Commission. The Company is under no obligation to (and expressly disclaims any such obligation to) update its forward-looking statements as a result of new information, future events or otherwise.

Non-GAAP financial measures

(1) “Adjusted property EBITDA” is earnings before interest, taxes, depreciation, amortization, pre-opening costs, property charges and other, corporate expenses, stock-based compensation, and other non-operating income and expenses, and includes equity in income from unconsolidated affiliates. Adjusted property EBITDA is presented exclusively as a supplemental disclosure because management believes that it is widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses adjusted property EBITDA as a measure of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors. The Company also presents adjusted property EBITDA because it is used by some investors as a way to measure a company’s ability to incur and service debt, make capital expenditures and meet working capital requirements. Gaming companies have historically reported EBITDA as a supplement to financial measures in accordance with U.S. generally accepted accounting principles (“GAAP”). In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including Wynn Resorts, Limited, have historically excluded from their EBITDA calculations pre-opening expenses, property charges, corporate expenses and stock-based compensation, that do not relate to the management of specific casino properties. However, adjusted property EBITDA should not be considered as an alternative to operating income as an indicator of the Company’s performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure determined in accordance with GAAP. Unlike net income, adjusted property EBITDA does not include depreciation or interest expense and therefore does not reflect current or future capital expenditures or the cost of capital. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other non-recurring charges, which are not reflected in adjusted property EBITDA. Also, Wynn Resorts’ calculation of adjusted property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

(2) Adjusted net income attributable to Wynn Resorts is net income before pre-opening costs, property charges and other, and other non-cash non-operating income and expenses. Adjusted net income attributable to Wynn Resorts and adjusted net income per share attributable to Wynn Resorts (“EPS”) are presented as supplemental disclosures because management believes that these financial measures are widely used to measure the performance, and as a principal basis for valuation, of gaming companies. These measures are used by management and/or evaluated by some investors, in addition to income and EPS computed in accordance with GAAP, as an additional basis for assessing period-to-period results of our business. Adjusted net income attributable to Wynn Resorts and adjusted net income attributable to Wynn Resorts per share may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

The Company has included schedules in the tables that accompany this release that reconcile (i) net income attributable to Wynn Resorts to adjusted net income attributable to Wynn Resorts, and (ii) operating income to adjusted property EBITDA and adjusted property EBITDA to net income attributable to Wynn Resorts.

 

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WYNN RESORTS, LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2012     2011     2012     2011  

Operating revenues:

        

Casino

   $ 953,390      $ 1,082,043      $ 2,002,669      $ 2,088,348   

Rooms

     124,880        119,998        242,383        235,379   

Food and beverage

     161,137        147,787        296,277        276,651   

Entertainment, retail and other

     101,402        102,416        207,311        201,370   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross revenues

     1,340,809        1,452,244        2,748,640        2,801,748   

Less: promotional allowances

     (87,602     (84,891     (181,935     (174,123
  

 

 

   

 

 

   

 

 

   

 

 

 

Net revenues

     1,253,207        1,367,353        2,566,705        2,627,625   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses:

        

Casino

     645,688        684,505        1,320,344        1,308,860   

Rooms

     33,265        31,887        63,249        62,459   

Food and beverage

     84,522        74,956        154,918        140,953   

Entertainment, retail and other

     46,108        54,164        97,766        110,439   

General and administrative

     99,777        91,912        205,727        179,573   

Provision for doubtful accounts

     (17,279     3,784        785        13,945   

Depreciation and amortization

     93,463        102,052        185,868        203,399   

Property charges and other

     3,540        111,060        13,826        114,408   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating costs and expenses

     989,084        1,154,320        2,042,483        2,134,036   

Operating income

     264,123        213,033        524,222        493,589   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income (expense):

        

Interest income

     2,483        1,577        4,048        1,976   

Interest expense, net of capitalized interest

     (73,874     (58,231     (135,935     (116,494

Increase in swap fair value

     2,646        3,135        4,930        7,365   

Loss on retirement of debt

     —          —          (4,828     —     

Equity in income from unconsolidated affiliates

     256        264        721        866   

Other

     (1,081     784        (313     1,701   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income (expense), net

     (69,570     (52,471     (131,377     (104,586
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     194,553        160,562        392,845        389,003   

Benefit (provision) for income taxes

     4,740        (5,231     4,857        (7,337
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     199,293        155,331        397,702        381,666   

Less: Net income attributable to noncontrolling interest

     (61,229     (33,300     (119,074     (85,831
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to Wynn Resorts, Limited

   $ 138,064      $ 122,031      $ 278,628      $ 295,835   
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic and diluted income per common share:

        

Net income attributable to Wynn Resorts, Limited:

        

Basic

   $ 1.38      $ 0.98      $ 2.62      $ 2.39   

Diluted

   $ 1.37      $ 0.97      $ 2.59      $ 2.36   

Weighted average common shares outstanding:

        

Basic

     99,782        123,970        106,243        123,864   

Diluted

     101,010        125,729        107,508        125,567   

Dividends declared per common share:

   $ 0.50      $ 0.50      $ 1.00      $ 0.50   

 

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WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED

TO ADJUSTED NET INCOME ATTRIBUTABLE TO WYNN RESORTS, LIMITED

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2012     2011     2012     2011  

Net income attributable to Wynn Resorts, Limited

   $ 138,064      $ 122,031      $ 278,628      $ 295,835   

Increase in swap fair value

     (2,646     (3,135     (4,930     (7,365

Property charges and other

     3,540        111,060        13,826        114,408   

Loss on retirement of debt

     —          —          4,828        —     

Adjustment for noncontrolling interest

     (4     (29,204     (1,459     (28,769
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income attributable to Wynn Resorts, Limited (2)

   $ 138,954      $ 200,752      $ 290,893      $ 374,109   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income attributable to Wynn Resorts, Limited per diluted share

   $ 1.38      $ 1.60      $ 2.71      $ 2.98   

 

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WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME TO ADJUSTED PROPERTY EBITDA

AND ADJUSTED PROPERTY EBITDA TO NET INCOME

(amounts in thousands)

(unaudited)

 

     Three Months Ended June 30, 2012  
     Las Vegas
Operations
     Macau
Operations
     Corporate
and Other
    Total  

Operating income

   $ 3,538       $ 225,548       $ 35,037      $ 264,123   

Depreciation and amortization

     62,776         29,985         702        93,463   

Property charges and other

     2,174         1,366         —          3,540   

Management and royalty fees

     5,189         36,374         (41,563     —     

Corporate expenses and other

     6,809         7,840         2,892        17,541   

Stock-based compensation

     1,328         1,097         2,781        5,206   

Equity in income from unconsolidated affiliates

     105         —           151        256   
  

 

 

    

 

 

    

 

 

   

 

 

 

Adjusted Property EBITDA (1)

   $ 81,919       $ 302,210       $ —        $ 384,129   
  

 

 

    

 

 

    

 

 

   

 

 

 

 

     Three Months Ended June 30, 2011  
     Las Vegas
Operations
     Macau
Operations
     Corporate
and Other
    Total  

Operating income

   $ 48,609       $ 123,737       $ 40,687      $ 213,033   

Depreciation and amortization

     66,253         35,101         698        102,052   

Property charges and other

     2,560         108,500         —          111,060   

Management and royalty fees

     5,867         39,280         (45,147     —     

Corporate expenses and other

     7,747         6,250         704        14,701   

Stock-based compensation

     1,559         1,480         2,892        5,931   

Equity in income from unconsolidated affiliates

     98         —           166        264   
  

 

 

    

 

 

    

 

 

   

 

 

 

Adjusted Property EBITDA (1)

   $ 132,693       $ 314,348       $ —        $ 447,041   
  

 

 

    

 

 

    

 

 

   

 

 

 

 

     Three Months Ended
June 30,
 
     2012     2011  

Adjusted Property EBITDA (1)

   $ 384,129      $ 447,041   

Depreciation and amortization

     (93,463     (102,052

Property charges and other

     (3,540     (111,060

Corporate expenses and other

     (17,541     (14,701

Stock-based compensation

     (5,206     (5,931

Interest income

     2,483        1,577   

Interest expense, net of capitalized interest

     (73,874     (58,231

Increase in swap fair value

     2,646        3,135   

Other

     (1,081     784   

Benefit (provision) for income taxes

     4,740        (5,231
  

 

 

   

 

 

 

Net income

     199,293        155,331   

Less: Net income attributable to noncontrolling interest

     (61,229     (33,300
  

 

 

   

 

 

 

Net income attributable to Wynn Resorts, Limited

   $ 138,064      $ 122,031   
  

 

 

   

 

 

 

 

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WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME TO ADJUSTED PROPERTY EBITDA

AND ADJUSTED PROPERTY EBITDA TO NET INCOME

(amounts in thousands)

(unaudited)

 

     Six Months Ended June 30, 2012  
     Las Vegas
Operations
     Macau
Operations
    Corporate
and Other
    Total  

Operating income

   $ 23,964       $ 437,271      $ 62,987      $ 524,222   

Depreciation and amortization

     126,194         58,273        1,401        185,868   

Property charges and other

     5,892         7,934        —          13,826   

Management and royalty fees

     10,640         74,433        (85,073     —     

Corporate expenses and other

     13,196         14,388        14,711        42,295   

Stock-based compensation

     2,699         (316     5,471        7,854   

Equity in income from unconsolidated affiliates

     218         —          503        721   
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted Property EBITDA (1)

   $ 182,803       $ 591,983      $ —        $ 774,786   
  

 

 

    

 

 

   

 

 

   

 

 

 

 

     Six Months Ended June 30, 2011  
     Las Vegas
Operations
     Macau
Operations
     Corporate
and Other
    Total  

Operating income

   $ 97,783       $ 318,139       $ 77,667      $ 493,589   

Depreciation and amortization

     132,049         70,034         1,316        203,399   

Property charges and other

     4,590         109,818         —          114,408   

Management and royalty fees

     11,795         73,774         (85,569     —     

Corporate expenses and other

     13,925         12,541         595        27,061   

Stock-based compensation

     4,424         2,873         5,379        12,676   

Equity in income from unconsolidated affiliates

     254         —           612        866   
  

 

 

    

 

 

    

 

 

   

 

 

 

Adjusted Property EBITDA (1)

   $ 264,820       $ 587,179       $ —        $ 851,999   
  

 

 

    

 

 

    

 

 

   

 

 

 

 

     Six Months Ended
June 30,
 
     2012     2011  

Adjusted Property EBITDA (1)

   $ 774,786      $ 851,999   

Depreciation and amortization

     (185,868     (203,399

Property charges and other

     (13,826     (114,408

Corporate expenses and other

     (42,295     (27,061

Stock-based compensation

     (7,854     (12,676

Interest income

     4,048        1,976   

Interest expense, net of capitalized interest

     (135,935     (116,494

Increase in swap fair value

     4,930        7,365   

Loss on retirement of debt

     (4,828     —     

Other

     (313     1,701   

Benefit (provision) for income taxes

     4,857        (7,337
  

 

 

   

 

 

 

Net income

     397,702        381,666   

Less: Net income attributable to noncontrolling interest

     (119,074     (85,831
  

 

 

   

 

 

 

Net income attributable to Wynn Resorts, Limited

   $ 278,628      $ 295,835   
  

 

 

   

 

 

 

 

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WYNN RESORTS, LIMITED AND SUBSIDIARIES

SUPPLEMENTAL DATA SCHEDULE

 

     Three Months Ended     Six Months Ended  
     June 30,
2012
    June 30,
2011
    June 30,
2012
    June 30,
2011
 

Room Statistics for Las Vegas operations:

        

Occupancy %

     87.6     89.2     83.5     88.5

Average Daily Rate (ADR)1

   $ 254      $ 240      $ 254      $ 240   

Revenue per available room (REVPAR)2

   $ 222      $ 214      $ 212      $ 212   

Other information for Las Vegas operations:

        

Table games win per unit per day3

   $ 4,384      $ 7,062      $ 5,923      $ 8,283   

Table Win %

     15.0     27.6     19.2     29.1

Slot machine win per unit per day4

   $ 186      $ 172      $ 192      $ 179   

Average number of table games

     217        229        219        227   

Average number of slot machines

     2,398        2,593        2,394        2,595   

Room Statistics for Macau:

        

Occupancy %

     90.0     90.5     90.7     89.6

Average Daily Rate (ADR)1

   $ 317      $ 314      $ 321      $ 311   

Revenue per available room (REVPAR)2

   $ 286      $ 284      $ 291      $ 278   

Other information for Macau:

        

Table games win per unit per day3

   $ 23,479      $ 25,872      $ 23,908      $ 24,591   

Slot machine win per unit per day4

   $ 752      $ 791      $ 812      $ 797   

Average number of table games

     490        482        490        475   

Average number of slot machines

     926        1,040        927        1,026   

 

(1) ADR is Average Daily Rate and is calculated by dividing total room revenue (less service charges, if any) by total rooms occupied.
(2) REVPAR is Revenue per Available Room and is calculated by dividing total room revenue (less service charges, if any) by total rooms available.
(3) Table games win per unit per day is shown before discounts and commissions.
(4) Slot machine win per unit per day is calculated as gross slot win minus progressive accruals and free play.

SOURCE:

Wynn Resorts, Limited

CONTACT:

Samanta Stewart, 702-770-7555

investorrelations@wynnresorts.com

 

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