Previous Statements by WYNN
» Wynn Resorts Ltd. Q1 2010 Earnings Call Transcript
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» Wynn Resorts Q3 2009 Earnings Call Transcript
Stephen WynnNot much to say that isn't explained on our press release except this. Business is slightly better in Las Vegas. We're noticing a little improvement because we've been working on our hotel mix. And we opened up the Beach Club on May 30, which was right in the last section of the quarter. But that's helped and been profitable and is ahead of plan. And it also has a related nightclub called Surrender. It had a minimal impact on our other clubs. So that segment of our business is quite incredible in Las Vegas. And that's in sharp contrast to the softness in the market, the nightclub and younger-person recreational market represented by Tryst, Blush, XS, Surrender and the Beach Club. That's a business that could do over $150 million for us, with a profit margin in the mid-40s. So we're really happy about that. We opened up Encore on April 22 or 21, so we had the benefit of it for all but 40 days. Its impact on our operations in Macau was, interestingly enough, accretive. There's a number that I mentioned on these conference calls in the past that I consider to be the critical number in understanding the gaming industry in any given jurisdiction. That number we refer to as fair share. And you measure the percentage of equipment you have in a market like the Strip or Macau, and then you measure the percentage of revenue. If you have the same percentage of revenue as you do of equipment, then you have your fair share, and that's a one-to-one. To the extent that, that number is less than one, then you are a dormitory for your neighbors and a net donor to the neighbor. And if it's more than one-to-one, then you are a net receiver, and you've made a dormitory out of your neighbors.
Prior to the opening of our Encore facility, we had 8.5% of the equipment and 10.5% or -- and 13% of roughly of the revenue. After, we didn't add much equipment, we went to 10% of the equipment, but we went to 17% of the revenue or 16% or 17%. Our ratio before Encore was 1.6. And I think that was by far the best in the market with our 500 tables now. Interestingly enough, we would have been very happy if we dropped down to 1.5. In fact, we went to 1.62. So not only do we add more equipment, but it increased our fair share ratio slightly. And that meant that our tables and our facility were well received. And that's, of course, gratifying for us. We're on the way to having the biggest year in the history of this company or any other company that I've been involved in, in my 42 years.So we're very happy. We had a board meeting a few minutes ago in this company. And after months of work, I was very proud to show the board of directors the Cotai project, which is now assembled. We now know what it's going to look like, what its components will be, where its romance and excitement will come from and how it will attempt, and I think very successfully attempt, to gain the upper hand competitively in a very competitive market, which is Cotai and Macau. So all of that, we’re underway now. We're finishing the back of the house, and we'll be starting the drawings for the foundation now almost in a matter of weeks. So we're a little ahead of schedule in where we thought we would be in Cotai. The design development period went much faster than it's gone in my career in the past, when we did all those other hotels, like Golden Nugget, Golden Nugget of Atlantic City, Beau Rivage, Treasure island, Mirage, Bellagio, Wynn, Encore in Las Vegas, Wynn in Macau and Encore in Macau. Read the rest of this transcript for free on seekingalpha.com