Last Thursday, Chief Executive Officer, Steve Wynn announced that Wynn Resorts Ltd. has a bright future and is optimistic about starting construction of its Paradise Park before the end of 2017. “I think we have nailed it down,” Wynn said to investors and experts on a call to discuss the company’s fourth-quarter results.
Wynn stated that of the proposed 38-acre lagoon walled by a convention center and hotel on the Strip that he hopes “to take the business plan to our board of directors in the second quarter and be in a position to begin work in the fourth quarter.” Wynn Resorts’ future lies in nongaming attractions and it’s those attractions that in turn will bring people to the gaming tables.
“We want to take our non-casino revenue to enormously high levels,” he said while describing the project’s idea. Wynn remarked after his company reported fourth-quarter net revenue rose 37.3%, beating analysts’ approximations. Shares poured despite adjusted revenues missing guesses as Wynn said business was off to a sturdy start in China.
Wynn Resort’s profits increased $353.5 million to $1.3 billion for the last three months of 2016, the company said in a report. Wall street analysts projected the company to post revenue of $1.25 billion, based on Zacks Investment Research data.
Net income flew at a slower pace, rising 31% to $113 million from $87.2 million a year ago. Adjusted for a non-recurring gain, net income would have declined to $51 million, according to the company. Earnings per share rose to $1.12. Excluding the nonrecurring gain, earnings were 50 cents per share. That fell far short of the estimate of 67 cents based on five analysts surveyed by Zacks.
The revenue increase came entirely from the new Wynn Palace in Macau. The earnings report represents the first full quarter of operations for Wynn Palace, which opened on 22nd August in Macau. Despite the earnings error, Wynn shares rose suddenly, jumping 7.6% to $102.75 in after-hours trading, as the company said the new year started off strong in Macau.
Wynn Palace has been generating $1.6 million in operating income per day since the beginning of the year, just four months after opening, Wynn said on the earnings conference call. In contrast, it took the Wynn Macau a year to generate $1 million per day, he said: “We are a little ahead now with our hotel occupancy at the Palace. We are running in the (90% occupancy range).” Wynn expressed.
The Palace is having “very good mass market success in Cotai” in spite of the continued construction nearby that affected pedestrian foot traffic throughout its first few weeks. The construction should be cleared by the second half, according to Wynn. Performance at its Las Vegas units has improved year over year in January, Wynn said. He expected that solid movement to remain amid the Chinese New Year, which kicks off Saturday, and the Super Bowl on 5th February.
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