Macau’s GGR continues to consolidate month in and month among falling revenues for Las Vegas brands. Wynn Resorts has been caught in the latest profit nosedive. The VIP segment has been affected the most.
Wynn Resorts Posts Weaker VIP Q1 Results
Wynn Resorts first-quarter figures didn’t reach their targets, the Las Vegas casino operator reported during its latest earnings call. Revenue dipped 3.7 per cent year-on-year during the first three months of 2019.
By March 31, Wynn had accumulated $1.65 billion, nearly 4 per cent shorter of last year’s performance. Adjusted earnings were also affected and Wynn Resorts posted 12.3 per cent dip year-on-year over the same period.
The earnings stood at $494.8 million while net income missed $105 million by a sliver. The net income, moderate as it was, still beat last year’s results when the company posted $204.3 million in losses over Q1, partly occasioned by the raging scandal involving Wynn Resorts’ then-owner and co-founder of the brand, Steve Wynn.
Wynn had to pay $35 million fine in Massachusetts for reportedly covering steven wynn’s advances on employees.
Mr. Wynn was found guilty of sexual harassment against employees which may have been going on for years with other Wynn executives keeping the matter under tight wraps.
The criminal misdemeanor of Mr. Wynn almost cost the company a new casino project in Massachusetts, which finally received regulatory approval to proceed. All losses and poorer performance criteria were occasioned by a withdrawal of VIP customers in Macau.
Mixed Results for Macau
Results in Macau were dividing. On the one hand, Wynn Palace saw a good uptick in profits with the results hitting a 9.1 per cent year-on-year increase whereas Wynn Macau’s revenue took a solid hit and reported 15.3 per cent less in overall results. Earnings also fell by 22 per cent, a considerable amount all things considered.
Both properties reported deceased interest in the VIP segment and table games over the first quarter of the year. Revenue for table games fell at home in Las Vegas, although slots went up by 10.7 per cent, a considerable amount altogether.
The company’s CEO, Matt Maddox, acknowledged that Wynn had been ceasing ground to competitors in Macau insofar as the VIP segment went. Wynn did conclude last year’s Q3 and Q4 with good performance across the board, and the company’s contentious lawsuit was kept away from the public eye.
Despite the regulatory go-ahead for the Massachusetts casino, Wynn will still have to pay a $35 million fine to cover for the sexual misdemeanor of Mr. Wynn. Mr. Maddox was fined $500,000 himself for his alleged involvement in keeping the matter under tight wraps.
Despite the “turmoil of the past 15 months,” as Mr. Maddox put it, Wynn Resorts is back in its stride. The diminishing revenue in Macau is expected to pick up in the second quarter and give the company a better foothold in Macau once again. Wynn continues to advertise to all customer groups and expects revenue to pick up in Q2.