Wynn pivots to grow fourth quarter earnings
A pivot in its target market has helped Wynn Resorts grow its earnings in Macau.
Calvin Ayre reports that the company saw its adjusted property earnings before interest, tax, depreciation and amortisation back in the black in the fourth quarter after it suffered a $112.1 million loss in the third quarter.
Wynn was in the positive by $39.4 million for the final quarter in the year, in part due to a greater focus on the premium mass gambling segment, a move that is likely to continue in the foreseeable future.
The latest figures were made available through a company filing, in which Wynn Resorts chief executive Matt Maddox pointed out that improved travel and reduced COVID-19 restrictions helped with the recovery process.
In addition, the premium mass segment gave the rebound “particular strength”, while VIP and mass-market gaming improved as well.
The quarter’s mass market table drop was $1.29 billion, six times higher than the previous quarter and VIP turnover from table games improved almost at the same rate, coming in at $4.58 billion.
Still, both figures were nowhere near the number Wynn Macau had seen a year earlier, before the coronavirus upended Macau.
The improvement in premium mass action was possible due to a shift in operations across the last six months of 2020.
Wynn realised what was going to drive its growth and began implementing changes that would allow it to focus better on the premium mass segment.
Maddox explained in the company filing that, “it’s crystal clear that the growth drivers for Macau are really the sweet spot for our company, and that’s the premium segment, premium mass in particular.”
He added, “the premium segment did better than the core mass segment, it was not down 50 per cent as the overall mass was.
“We do not need 50,000 people a day walking through our facilities to get back to our target.
“We require significantly less people because we cater to the higher-end customer…we are targeting that segment and we are going to get more market share in the premium-mass segment than we have in the past.”
Wynn had predicted in 2020 that VIP gambling was likely to take a hit as it began to shift gears.
However, the changes don’t reflect a complete move away from the segment.
The company knows that it still needs to give its high rollers a lot of attention and has indicated that it already has a number of whales ready to descend on its Macau properties during the Chinese New Year holiday period.
It wasn’t clear how full Wynn’s properties will be for Chinese New Year, but there are still plenty of rooms available across the city.
GGR Asia investigated the occupancy rates for area hotels and found that, of the 22 five-star hotels available, 21 had plenty of vacancy.
The media outlet relied on booking availability that could be gleaned from company website reception desks and found that only Banyan Tree Macau in Cotai was completely full for the holiday.
Macau loses two Michelin star restaurants in 2021
The Macau casino sector has seen a decline in the number of Michelin-starred restaurants at its casino resorts.
GGR Asia reported in January that the latest edition of the Michelin Guide Hong Kong Macau revealed 18 restaurants in Macau boasting a Michelin star, down from 20 in the previous year.
All the still-listed eateries are located inside a casino hotel or resort.
Macau had again three restaurants awarded three stars.
It is Michelin’s top accolade for food that it considers “exceptional cuisine”.
Two of the outlets, French favourite Robuchon au Dome, and a Chinese fine dining outlet The Eight, are at Grand Lisboa casino hotel, owned by gaming operator SJM Holdings.
Jade Dragon, a Cantonese-cuisine restaurant at City of Dreams Macau, a casino resort run by Melco Resorts and Entertainment also kept its three-star rating.
Missing from the 2021 list of two-starred venues is The Tasting Room, a French contemporary restaurant at City of Dreams Macau.
In May, Melco Resorts closed that eatery linked to the Revamp of Nuwa, a hotel at the City of Dreams complex.
