Wynn Resorts revealed that the company lost about 73 million USD in the last quarter of 2019. The bad news from a slow year is not everything, unfortunately for Wynn. The Macau Coronavirus casino shutdown is costing the operator 2.5 million USD every day. There is no information if the closure will last longer than the initially agreed two weeks.
Overall, the company had a rocky 2019 on account of several issues. Of course, the biggest one dates back to 2018 and its then-CEO Steve Wynn. This was the year when the Steve Wynn sexual harassment scandal came to a halt, at least temporarily. While the operator paid out a big amount of money and agreed to many changes in its oversight procedures, it still kept its gambling licenses. The possibility of losing these in Nevada, for example, would dwarf any issue the operator currently has.
However, the impact was still not negligible. Year-on-year, Wynn net loss came to $72.9 million. Revenue for the same period is down by 1.5 percent and net income fell by 78 percent. The second figure is not as bad as it seems, being that previously the casino had a helping hand from the tax breaks it got from the Donald Trump administration.
Still, saying that Wynn Resorts had a bad 2019 would be a huge understatement. At the same time, there is the problem of the reputation damage from the Steve Wynn scandal. While the hatchets seem to be presently buried, there is no assurance that the issues like the ongoing civil lawsuits will not continue.
Wynn Palace casino in Macau reported a revenue fall of 20 percent in 2019 Q4. VIP gambling turnover also unsurprisingly fell by over 40 percent while VIP revenue went down to just 286 million USD. This is a year-on-year loss of over 45 percent. The hard numbers of last year are now further going down on the account of the Coronavirus outbreak.
Matt Maddox, the CEO of the company, said that the 15-day casino closure will be disastrous for the operator and the whole local gambling industry. The payroll expenses now cost the operator between 2.4 million and 2.6 million USD every single day. Still, Maddox wanted to present a brave face for the long-term casino outlook in Macau.
He said that he believes in the potential for a great rebound once the virus crisis has passed. This is why Wynn Resorts remain optimistic about the long-term aspects of the Macau market. However, such a statement could also come from the desire to not add insult to injury, which would in turn likely kickstart stock sell-off. Presently, no one knows what the short and medium-term Macau potential or even if there is one of the casino closure continues.
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