Wynn Palace, which opened its doors Aug. 22 in the Cotai district of the Chinese territory of Macau, produced net revenue in the quarter of $418.7 million, with casino revenue totaling $373.2 million. By contrast, the Wynn Macau business showed net revenue in the fourth quarter of $498.4 million, a drop of 10 percent from the year-ago period; casino revenue also fell by 10 percent.
"All of this suggests that Wynn Palace is ramping up nicely, without cannibalizing its peninsula property too much," said JPMorgan in a research note Thursday.
During the earnings conference call, Chairman and CEO Steve Wynn said the Wynn Palace occupancy is running ahead of company projections and achieving "good mass market activity" and attracting the higher-end customer too. Business at Wynn Palace is picking up after a slow start at the $4 billion casino-resort complex that had weighed on the company's stock price last fall.
Wynn said he remains bullish on the Macau market's outlook. "The long-term thrust of China is inexorable and undeniable — and that's why we built what we built and we're going to build more in the future."
The Las Vegas operations showed net revenue of $383.3 million in the quarter, down 2 percent from the year-ago quarter. Casino revenue was $166 million, or a drop of almost 3 percent from the year earlier.
During the earnings conference call, the CEO updated investors on the company's plans to build a new attraction on 130 acres off the Las Vegas Strip — a $1.5 billion Paradise Park. Wynn, who first discussed the park last spring, said Thursday he hopes to take the plan to the company's board in the second quarter and be in a position to begin work in the fourth quarter of this year.
"We have to have our prices and our business plan all locked down before I go to my board to get their permission and to proceed," Wynn said.
The proposed Paradise Park expansion would feature a lake, lagoon, sandy beach, boardwalk, as well as new entertainment and retail components — all part of the company's efforts to generate more non-casino revenue in Las Vegas. The company also wants to add a new hotel tower along with more convention space in the gambling city.