Melco Resorts and Entertainment is the latest group to express optimism about an uptick in Macau following restrictions throughout the region that have caused continued struggles over the past year’s fourth and full-year.
The total revenue fell 30 percent to $337.1m in the first of these reporting periods (2021: $480.6m). Each of the City of Dreams, Altira Macau tracking decreased by 43.13 and 32.33 respectively to $139.2m (2021; $244.8m and $9m 2021: $13.3m, respectively).
The casino operator stated that this was due to the increased travel restrictions in Macau, mainland China, and COVID-19. This led to lower performance in the mass market and rolling chip segments.
Recent developments have been praised, with travellers from Mainland China and Taiwan no longer being required to submit negative tests. Masks are not required for outdoor locations starting February 27, 2023.
The group issued a warning despite the significant increase in Macau’s gross gambling revenue, which was tracked from MOP 3Bn in December 2022, to MOP 11.6bn by January 2023.
Although Greater China is now free of quarantine, it remains unclear how fast recovery will proceed. The disruptions caused the outbreak have had a significant adverse effect on Melco’s operations and financial position, as well as future prospects, through the first quarter of this year.
“We promise our full support for the sustainable and diversifying development of Macau’s tourism and leisure sector”
Lawrence Ho is Chair and Chief Executive Officer. He explained that the travel restrictions in Macau and mainland China continued to impact our fourth quarter 2022 results.
“However we are encouraged to see the increase in visitation and volume since travel restrictions between Macau and mainland China were lifted on January 8, 2023.
“Our recent performance confirms our belief that there is a return to pent-up demand. We also believe that Macau will continue its development as an international destination for entertainment, leisure and entertainment.
“We are honored to be granted a gaming concession in Macau to allow us to operate for the next ten years. We are grateful for the consideration we received regarding our proposal and our investment in two propositions that, we believe, will build on our strengths in entertainment as well as non-gaming attractions.
“We have pledged our full support for Macau’s sustainable and diversified tourism and leisure sector development, and will continue working with the Macau government, community, and other stakeholders to help the city become a top global destination for tourism.”
On the revenue front, City of Dreams Manilla saw its revenue rise 13.46 percent to $95.2m (2021 : $83.9m). Cyprus casinos closed with $28.7m. This is an increase of 28.12 percentage from $22.4m.
Revenue fell 48.8% to $1.35bn on a full-year basis (2021: 2.01bn), due to the various struggles encountered during Q4.
“…We are encouraged by the higher visitation and volume since travel restrictions between Macau and mainland China were lifted”
Ho observed that “Gaming volume in the Philippines has reached near pre-pandemic levels and that in Cyprus, volumes have exceeded those seen before,”
“We are positive about the Philippines’ and Cyprus’ continued growth as international travel normalizes.”
Q4 operating loss was $199.5m (2021 : $104.4m), and this trend continued on an FY basis, after tracking $743.1m (2121 : $577.5m). After closing at $159.9m (2021, $251.9m) & $930.5m (2121: $811.8m), net loss followed suit.
The Adjusted EBITDA suffered significant losses throughout each time period. Q4 saw a loss of $6.8m, compared to $94m YoY. For 2021, this was $600,000. (2021: $235.1m).
Ho concluded by giving an update on the group’s expansion projects. “In regard to our development projects we expect Studio City Phase 2 to open in 2023’s second quarter.
“The first stage of the opening will include one of our hotel towers as well as the indoor water park. This is expected be the largest in Asia.
“The second phase is expected to open in the third quarter. We have been informed by the Council of Ministers in Cyprus that they have extended the deadline for opening City of Dreams Mediterranean, as per our gaming license, to June 30, 2023. We continue to work closely with our contractors to achieve that goal.
