Executives of Wynn Resorts expected eight submissions for six casino licenses in Macau, meaning two challengers in addition to the six incumbents. Only one challenger — Genting Group — showed up, further easing Wynn’s collective mind on its prospects in the enclave.
That was one of the takeaways from J.P. Morgan analyst Joseph Greff’s sit-down with three top Wynn executives this week. Chief Financial Officer Julia Cameron-Doe, Treasurer Vince Zahn, and investor-relations executive Amir Markowitz met with Greff to discuss the company’s prospects.
China was on the forefront of all their minds. The cost of reapplying for a concession, $1 million, was described as “a low hurdle.” Of equal concern was laying out a reopening scenario in Macau, where visa restrictions are expected to be eased next month. Greff called this “the first positive step in two years.” Still, he predicted that the recovery from a two-year lockdown would not be linear.
Wynn is confident that it can convert high-rolling junket participants to direct customers, thereby improving the margins on high-end business, which it had to share with junkets until the Chinese government cracked down on them. However, premium business remains volatile, so Wynn management is encouraged by a market shift toward mass-market/premium-mass traffic.
Back home, the new convention center at Wynn Las Vegas is proving to be a boon for Wynn Las Vegas and Encore, increasing the number of occupied room nights and “the roughly two-month booking window for leisure/gaming customer remains strong.” Even so, management is looking for an upcoming automobile show and a golf tournament (Capital One’s The Match) to further drive business. Wynn Resorts is also taking advantage of inelastic and high prices across the board, whether it be in room rates, food and beverage, or convention business. “Notably, these strong trends in Las Vegas are sans any meaningful international inbound, nor the theater and showroom, which are closed,” Greff added.
In Boston, the company is looking forward to its addition of parking and entertainment space as a means of growing its customer database. The executives told Greff that they believe the slot floor is just the right size for current business and they’re turning the gaming focus toward the opening of a sportsbook at Encore Boston Harbor in time for Massachusetts’ brick-and-mortar sports betting. The sportsbook will be ready in a matter of weeks, even though sports betting will not go live in the Bay State until late January by current estimates.
Wynn executives also hope to break ground on their United Arab Emirates casino by the end of June next year and perhaps earlier, with an estimated completion in 2027. To attract customers, Wynn will lean on the extant 8,000 hotel rooms in the area as its initial target market, followed by Abu Dhabi and Dubai, then the remainder of the world.
