Riding a wave of revenue from Macau, Wynn Resorts Ltd. today reported third-quarter earnings of $127.1 million on net revenue of $1.29 billion.
The company lost $33.5 million in 2010’s third quarter with revenue of $1 billion.
Company CEO Steve Wynn also said the company is investigating prospects of establishing casinos in Massachusetts and Florida.
This year’s results capitalized on a 41.7 percent increase in revenue from its Wynn Macau and Encore at Wynn Macau properties. Steve Wynn offered some details about a new Macau property on the Cotai Strip, but gave no timetable on construction.
The company reported earnings per share of $1.01 compared with a loss of 27 cents a share in the third quarter of 2010.
In Macau, the world’s largest gaming market, the company had substantially higher revenue from the casino and hotel rooms compared with Las Vegas in the third quarter.
The company reported 88.3 percent occupancy and an average daily room rate of $240 in Las Vegas compared with 93.7 percent occupancy and average rates of $315 in Macau.
In the casinos, Las Vegas generated $187 per slot machine on an average 2,514 machines and $5,259 per table on an average 228 tables.
In Macau, slots generated an average of $696 per machine on 1,008 machines and $25,134 per table on 485 tables.
“I think the numbers speak for themselves,” Wynn said at the beginning of a conference call on earnings with analysts. He said while the third quarter had great results, October’s numbers would be “gangbusters." Although he didn't elaborate on that assessment, he said early October is a holiday period in China.
While Macau continues to drive the company’s fortunes, Wynn said it is looking seriously at opportunities in Massachusetts and Florida, pegged to be the next potentially lucrative domestic markets.
“There are some very pregnant opportunities presenting themselves in Massachusetts and Florida,” Wynn told analysts. “Neither jurisdiction has made a final decision that we can measure quantitatively in order to make a decision for ourselves. But those are very interesting markets.”
He said his company would evaluate prospects based on each jurisdiction’s goals.
“When we sit here in Las Vegas and look at these things, we asked a couple of questions: What is the deal that the state has put on the table? How strong is the invitation? Are they motivated strictly by tax revenues, employment or a balance of the two? Do they want capital investment, long-term investment and job security for their employees or is this a quick, down-and-dirty ‘How much can we grab?’”
Wynn recalled that in Illinois, state government leaders opted to change the tax rate overnight by 15-20 percent.
“That wouldn’t even happen in China,” Wynn said. “I mean, that’s really rough.”
Wynn said he senses “a more serious and mature political approach” in Florida and Massachusetts. He said Florida has the potential of being one of the top destinations in the world.
“Miami has always been one of the places in the world perfectly suited to become a vastly expanded destination resort, not just for Latin America, but for Europeans, East Coast Americans and for people from all over the United States,” Wynn said. “The climate, the ancillary offerings, the beaches and restaurants and shopping … Miami is a fabulous place. If it were done right, in my opinion, Miami would take off and become one of the two or three greatest destination resort cities in the world.
“Miami has the opportunity of becoming something quite extraordinary. It won’t happen with racinos. That doesn’t even get on the radar. It’s a false start, and it’s been a false start everywhere that they’ve tried it.”
Wynn said his already good fortunes in Macau could improve even more with the construction of a monorail linking the Cotai Strip and the 17-square-mile former Portuguese colony’s peninsula.
“We’re the first stop from the ferry terminal,” Wynn said. “That monorail circles two sides of our property which is very nice for us. And it will circle two sides of our hotel on the peninsula, the Encore and Wynn. It has a stop right at our door. These kinds of projects are new and have placed a terrific load on the government’s staff.”