Melco Resorts and Entertainment Ltd (MLCO)

[MCArmel1]

Melco Crown Entertainment misses by $0.04, misses on revenue

Aug 6 2015, 08:20 ET | About: Melco Crown Entertainme... (MPEL) | By: Mohit Manghnani, SA News Editor

Melco Crown Entertainment (NASDAQ:MPEL): Q2 EPS of $0.05 misses by $0.04.
Revenue of $916.8M (-23.6% Y/Y) misses by $55.49M.
Shares -2.3% PM.
Press Release

http://seekingalpha.com/news/2703156-melco-crown-entertainment-misses-by-0_04-misses-on-revenue?uprof=45#email_link


Melco Crown Entertainment Announces Unaudited Second Quarter 2015 Earnings and Declares Quarterly Dividend
Thu August 6, 2015 8:17 AM|GlobeNewswire | About: MPEL

MACAU, Aug. 6, 2015 (GLOBE NEWSWIRE) -- Melco Crown Entertainment Limited (MPEL) ("Melco Crown Entertainment" or the "Company" or "we"), a developer, owner and operator of casino gaming and entertainment resort facilities in Asia, today reported its unaudited financial results for the second quarter of 2015.

Net revenue for the second quarter of 2015 was US$916.8 million, representing a decrease of approximately 24% from US$1,199.5 million for the comparable period in 2014. The decline in net revenue was primarily attributable to lower rolling chip revenues and mass market table games revenues in Macau, partially offset by the net revenue generated by City of Dreams Manila, which started operations in December 2014.

Adjusted property EBITDA(1) was US$204.9 million for the second quarter of 2015, as compared to Adjusted property EBITDA of US$313.6 million in the second quarter of 2014. The 35% year-over-year decline in Adjusted property EBITDA was attributable to lower group-wide rolling chip volumes and rolling chip win rate, together with a lower contribution from the mass market table games segment.

On a U.S. GAAP basis, net income attributable to Melco Crown Entertainment for the second quarter of 2015 was US$24.3 million, or US$0.05 per ADS, compared with net income attributable to Melco Crown Entertainment of US$143.6 million, or US$0.26 per ADS, in the second quarter of 2014. The net loss attributable to noncontrolling interests during the second quarter of 2015 of US$30.0 million was related to Studio City and City of Dreams Manila.

Mr. Lawrence Ho, Co-Chairman and Chief Executive Officer of Melco Crown Entertainment, commented, "We delivered a solid operating and financial performance in the second quarter of 2015 in what continues to be a challenging environment for Macau.

"During the quarter, we maintained our company-wide cost control focus, including continuous strong discipline on marketing costs, player reinvestment and payroll costs. While we are focused on managing costs during this challenging demand environment, we remain fully committed to the long term development of our employees.

"As an employer of choice with a strong and deep heritage in Macau, we believe that our long term success is dependent on the hard work and dedication of our employees, and the development of Macau into a leading, multi-faceted leisure and tourism destination. The development of our employees and the ongoing support of the local community are evident in our market-leading training and community programs.

"The imminent opening of Studio City has created new and exciting employment opportunities for the community and our existing employees. We expect a meaningful number of our experienced colleagues to choose to take advantage of the new opportunities and new avenues to professional growth and development available at Studio City. Studio City will benefit from the sharing of the Company's core values and community spirit, and the industry expertise necessary to deliver market-leading services upon its opening. The lateral movement of employees facilitates the rationalization of our work force and is expected to allow us to realize potential cost-savings across all the relevant businesses at the time of opening.

"We are very excited about Studio City as our subsidiary embarks on the next major stage of development, with the opening of the Hollywood-inspired integrated resorton October 27, 2015. This latest large-scale integrated resort is designed to introduce to Macau a more diversified mix of entertainment than ever before and set to become a catalyst to the market, and substantially enhance Macau's appeal to an increasingly sophisticated Asian consumer who is continually seeking world-class, multi-faceted tourism experiences.

"Studio City, on track to meet its design and construction budget of US$2.3 billion, will complement our already unique and innovative portfolio of assets including City of Dreams, which remains the leading premium-focused integrated resort in Macau.

"Macau is currently experiencing a difficult period. However, we believe that through the strong leadership from the Macau and Chinese governments, the ongoing build-out of significant local and regional infrastructure, together with an expanding and increasingly affluent Chinese middle-to-upper-class, Macau remains the world's most important and exciting gaming market. We look forward to continuing our leadership role in the development of Macau into a truly diversified tourist destination.

"In Manila, City of Dreams continues to grow revenues across all business segments, with the rolling chip segment gaining meaningful traction last month. The property's world-class array of gaming and non-gaming attractions enables City of Dreams Manila to enjoy market-leading visitation in Manila, positioning the property for long term success as the city develops into one of the leading tourism destinations in Asia."

City of Dreams Second Quarter Results

For the quarter ended June 30, 2015, net revenue at City of Dreams was US$654.2 million compared to US$967.5 million in the second quarter of 2014. City of Dreams generated Adjusted EBITDA of US$179.0 million in the second quarter of 2015, representing a decrease of 38% compared to US$290.2 million in the comparable period of 2014. The decline in Adjusted EBITDA was primarily a result of lower rolling chip revenues and mass market table games revenues.

Rolling chip volume totaled US$11.1 billion for the second quarter of 2015 versus US$22.1 billion in the second quarter of 2014. The rolling chip win rate was 2.7% in both quarters ended June 30, 2015 and 2014. The expected rolling chip win rate range is 2.7%3.0%.

Mass market table games drop decreased to US$1,198.8 million compared with US$1,330.8 million in the second quarter of 2014. The mass market table games hold percentage was 32.4% in the second quarter of 2015 compared to 37.4% in the second quarter of 2014.

Gaming machine handle for the second quarter of 2015 was US$1,116.7 million, compared with US$1,511.4 million in the second quarter of 2014.

Total non-gaming revenue at City of Dreams in the second quarter of 2015 was US$63.8 million, compared with US$67.2 million in the second quarter of 2014.

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