Update | Wynn Macau's revenue drops 32 per cent; Wynn Palace project suffers delays
“We believe Macau casinos will experience further short-term pain this year" - S&P
The opening of Wynn Macau’s Cotai project Wynn Palace will be delayed due to construction permits, the second casino resort in Macau to have its launched date pushed back, as the firm posted a 32 per cent decline in revenue in the fourth quarter, dragging down earnings at Las Vegas, Nevada-based parent Wynn Resorts.
Although the US$4.1 billion Wynn Palace is on budget, management said they expect it to launch sometime in the first half of 2016 instead of a previous target date to operate before next year's Lunar New Year holiday.
The delay was due to the timing of construction worker permits and follows Sands China’s announcement that they would push back the opening of the Parisian from late this year to early next year, also due to labour issues.
“In the latest round of permits, they received 700 workers after requesting 1,000 and the approvals came three months late. Wynn said they need another 1,600-1,700 from upcoming approvals. ..We believe a delay to 2016 projects would mean a better and longer headstart period for 2015 casino openings from Galaxy and Melco,” a Barclays report published yesterday said.
Wynn Macau said its fourth-quarter net profit dropped 49 per cent to US$139.7 million from a year earlier
Galaxy Phase II and Broadway resort will launch on May 27 and Melco Crown Entertainment’s Studio City is due later this year.
The Hong Kong-listed company’s weak results announced on Wednesday followed last month’s report by the Macau government, which estimated that the city’s gross gaming revenue last year decreased 2.6 per cent to 351.5 billion patacas (HK$334.3 billion) from the previous year.
