Wynn Macau Profit down 18%

Las Vegas billionaire Steve Wynn’s casino in China, Wynn Macau, saw its quarterly net profit slump by 18% which experts attributed to Wynn’s targeting of high-rollers who get exclusive casino bonuses, which make a a big % of players at the casino.

Net profit was $197m in Q4 compared with $240m for Q4 20111. Revenues were down10 per cent to $839m.

Down the other end of the Cotai Strip, Sands China, Sheldon Adelson’s gambling palace, said its Q4 net profit rose 52 per cent to $467m as more players headed to its newest casino in the former Portuguese territory.

The Sands properties are more diverse and appeal to a wider group of customers, notably the mid-market of Chinese gamblers and visitors travelling with their families in tow. (More of a Las Vegas profile in other words)
This middle bit of the market is thought to be the better long term option. It’s more stable. Overall in the casino town, Macau casino revenues for 2012 were a record 304bn patacas ($38bn).
Steve Wynn said the company would start constructing a new Wynn casino on the Cotai Strip shortly. The $4bn property on a 50-or-so-acre site will broaden Wynn’s chhoice in Macau and enable it to compete more efficiently with rivals Galaxy Entertainment and Sands. Mr Wynn said it would up and running and accepting players in 3 years time.
The number of VIP players– ultra rich players clients who play behind the velvet ropes rooms in Macau’s casinos and brought in by the casino junket operators mostly to play bacarrat – was down 4 % Q4 versus Q3 at Wynn Macau. Wynn’s middle market revenues were up 3% (not enough to compensate), and they lagged the market- the overall mass market was up 11%.
Mr Wynn told analysts that the competition in Macau was “murder tough”. He described Francis Lui, whose family controls Galaxy, and Mr Adelson and others as “tough guys . . . they are on right their game” in Macau.

Wynn Macau’s shares were down over 2% to HK$21.25 on Friday afternoon.

We are thinking it could be a good time to buy Wynn Macau shares if they continue to dip…………..

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