It’s a good time to be in the online gaming, casino, and hotel business, it seems, as Wynn Resorts posted solid underlying numbers in their second quarter earnings before the bell on Monday. Interestingly, Wynn’s strength was derived from Las Vegas, which helped pushed margins even higher, as the Macau operations lagged. Rising casino revenues in the City of Sin suggest Wynn doesn’t have much to lose from Zynga, with which the company was reportedly in talks with, bowing out of online poker and gambling.
Billionaire Steve Wynn is probably happy with his company’s financial performance, particularly in Vegas and in online gaming. His hotel and casino operator saw adjusted property EBITDA rise 10.8% to $425.7 million in the second quarter; adjusted net income rose 10% to $152.9 million, which translates into an EPS of $1.51.
The company did miss earnings estimates (which called for an EPS of $1.55), but underlying numbers appear compelling. EBITDA margins expanded to 32% from 30.6% a year ago, while casino revenues currently make up 76.4% of total sales, a 40 basis point expansion. Wynn, it seems, doesn’t need online gambling to grow its gaming business at this juncture.
Net revenue for online gaming and other metrics rose 6% to $1.33 billion, in line with analysts’ expectations, and driven primarily by Las Vegas. Wynn’s operations in the City of Sin saw revenue jump 16.2% to $401.4 million, while adjusted property EBITDA surged 65.6% to $135.7 million. Management noted the improvement in Las Vegas over last year, while EBITDA margin expanded a dramatic 1,010 basis points to 33.8%.
