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Melco results boosted by group-wide VIP growth

Melco Resorts & Entertainment Limited (MLCO) reported net income of US$36.5 million in the second quarter of 2017, driven by improved group-wide rolling chip revenues.

Bernstein noted that “while VIP was a focus of discussion, the company reaffirmed that success will come from mass. “However, the two consecutive quarters of subpar mass performance in Macau is a concern,” it wrote.

The company posted net revenue of US$1.3 billion in 17Q2, representing an increase of approximately 21 percent from US$1.1 billion in the prior year period.

Adjusted property EBITDA was US$329.5 million, representing an increase of 34 percent year-on-year, said the company.  

“Macau continues on its strong growth trajectory, with all gaming segments delivering impressive year-over-year growth driven by improving tourism demographics, an ongoing improvement in player sentiment as well as an expansion of non-gaming amenities across Macau,” commented Melco chairman and CEO, Lawrence Ho.

Its newest property, The Morpheus, is expected to open in the first half of 2018. Along with the redevelopment of the Countdown, the property will have approximately 2,100 five-star luxury hotel rooms, said Ho.

The chief executive also pointed at record revenue and property EBITDA at the City of Dreams Manila, which reached US$176.2 million and US$62.8 million respectively.

The year-on-year improvement in adjusted EBITDA was primarily a result of increased casino revenues, said the company in a statement.

Ho said the company has also been heavily focused on identifying additional value-accretive expansion opportunities, with a particular focus on Japan.

“We believe that our high quality assets, market-leading social safeguard systems and commitment to being an ideal partner to local governments and communities alike, as we have shown in Macau and the Philippines, places us in a strong position to compete for a license in this exciting market.”

The company has announced a quarterly dividend of US$0.03 per share for the second quarter of 2017, to be paid August 23, 2017.

Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.

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