Casino Earnings Reports

As expected, following the announcement of surging gambling in Macau, two of the biggest beneficiaries were Wynn Resorts Ltd. (WYNN) and Las Vegas Sands Corp. (LVS).
Wynn Resorts reported revenues of $1.52 billion, an increase of 18 percent over 2012, and net income of $213.9 million or $2.10 per share compared to last year’s $111.4 million or $1.11 per share.
Also rising was the company’s revenues in Las Vegas. The company said its Las Vegas revenues grew by 2.4 percent to $400 million.
“Results were primarily driven by strong mass market revenues in Macau, which we’re favorable, given that it is a more stable and higher-margin business,” said John Kempf, gaming analyst for RBC Capital Markets.
For the year, Wynn Resorts posted revenues of $5.62 billion, an increase of 9.1 percent of the $5.15 billion registered in 2012. Net income, during the period was $776.8 million or $7.64 per share. A year earlier, net income was $558.3 million or $5.36 per share.
CEO Steve Wynn said the “numbers speak for themselves.” He added that his Wynn Palace project on Macau’s Cotai Strip should be opening in the next 23 months.
On a controversial note, Wynn said his gaming company is definitely being impacted by the recently-required Affordable Health Care Act and he and others were struggling to overcome its effect.
Wall Street was impressed by Wynn’s report. By the end of trading on Friday, WYNN shares were trading at $217.42
Las Vegas Sands
Although the numbers from Macau were outstanding, Las Vegas Sands Corp. (LVS) shareholders were not treated as kindly as WYNN shareholders, following the company’s quarterly fiscal report.
In fact, one publication headlined its report, “Las Vegas Sands Rolls Snake-Eyes on Earnings.”
That, however, was far from reality.
For the quarter that ended on Dec. 31, 2013, Sands reported revenue of $3.66 billion, a 19 percent increase over last year’s $3.08 billion. Net income was $577.5 million or $0.70 per share. A year ago, the net income was $434.8 million or $0.53 per share.
Analysts had forecast revenue of $3.72 billion and per share earnings of $0.83. As a result, LVS shares fell during trading, only to recover a bit on Friday when the share price closed at $76.51
The problem with Sands’ Singapore operation was an extremely low hold, said analysts. The hold was given at 1.92% versus a normal hold of 2.85%.
For the full year, the company reported revenues of $13.7 billion (more than all of Nevada and New Jersey gaming revenues combined) and net income of $2.31 billion. This easily topped the $1.52 billion recorded in 2012.
Mohegan Sun
The Mohegan Tribal Gaming Authority, operator of the Mohegan Sun Casino Resort in Connecticut, and a suitor of a Massachusetts casino license, reported a major shortfall in earnings during the quarter that ended on Dec. 31, 2013.
Net income for the quarter was $33.3 million on revenues of $312.8 million. Last year, revenues were down about 4 percent while net income was at a lofty $42.2 million.
The operating company blamed the decline on a weakness in the country’s economy.
The company also operates a racino in Pennsylvania and hopes to receive a casino license to be located in Revere, Mass.

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