We’re in the thick of first quarter earnings season, but it is doubtful any companies will present themselves as bullishly as Las Vegas Sands and Wynn Resorts, which were early reporters.
Wynn Resorts
New Wynn CEO Matt Maddox led a virtual pep rally. Here’s a synopsis of how he started, noting that the company experienced a tumultuous 60 days:
“Who we are: The leading operator of luxury five-star resorts catering to the most discernible customers in the world… 25,000 team members… serving 25 million customers a year… Together, we are Wynn (who have produced) record results”, Maddox said.
Maddox then listed many of the accomplishments of those 60 days:
- Steve Wynn is no longer a shareholders with much of his holdings was purchased by two institutional investors.
- Galaxy Entertainment has bought a 4.9 percent long-term stake in WYNN.
- ”No longer mired in litigation…” as six years of litigation with Universal ended with redemption of shares at $78, “It was a great deal for our company. It was a great deal for our shareholders and settled six years of litigation with Elaine Wynn at no cost to the company.”
However, “As the CEO, I’m not interested in looking in the rear-view mirror,” Maddox said
Maddox then discussed what he called a reprioritizing that puts focus on more immediate return on investment, which has led to scaling back the planned $3 billion expansion at Wynn Las Vegas, which he called unsustainable.
And, while Maddox said the company will consider whether the next multi-billion dollar project should be at Wynn Las Vegas or across the Strip at recently acquired New Frontier Land, he made his point about the new direction.
Perhaps as interesting as what Maddox said was how he said it and the interaction of other executives on the call. It was almost like they have been freed by the resignation of founder and former CEO Steve Wynn.
A replay of the call is worth a listen to hear the new energy and interaction. It is available through May 3 at 877-344-7529 US/Canada or +1-412-317-0088 for international callers, pass code:10118765.
Las Vegas Sands
Meanwhile, Las Vegas Sands CEO Sheldon Adelson was extraordinarily bullish on the future of Macau and his company, with COO Rob Goldstein right there with him as the company handily beat first quarter expectations.
The ability of LVS’ business model to generate positive financial results in all areas was on display in the record quarter, Adelson said.
In Macau, “The demand for hotel rooms is insatiable” in a market where LVS enjoyed 94 percent occupancy despite the addition of 10,000 rooms in the past two years, Goldstein said.
The growth is especially being fueled by new visitors coming from further into China than historically strong adjacent Guangdong Province, Goldstein said.
The newcomers are younger, more affluent, seeking out tourist amenities, and they come to gamble. “Our properties are built for this customer,” Goldstein said.
And it will only get better as transportation projects are completed, including the opening of the Zhuhai-Hong Kong-Macau bridge later this year, Goldstein said.
The bridge will open Macau to the whole Pacific Rim through the Hong Kong airport, Adelson said.
“We’re damned excited about the bridge,” Goldstein said.
Adelson emphasized that LVS will continue to invest in Macau, citing construction of the St. Regis hotel and transformation of Cotai Central into the Londoner.
Las Vegas Sands has a lot of eggs in the Macau basket and apparently sees reason to add a few more.
