Melco Resorts & Entertainment (MLCO) Tops Q4 EPS by 25c, Revenues Beat

February 25, 2021 8:12 AM EST

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Melco Resorts & Entertainment (NASDAQ: MLCO) reported Q4 EPS of ($0.42), $0.25 better than the analyst estimate of ($0.67). Revenue for the quarter came in at $528 million versus the consensus estimate of $502.38 million.

Mr. Lawrence Ho, our Chairman and Chief Executive Officer, commented, “COVID-19 and the subsequent travel restrictions continue to have a significant negative impact on our operating and financial performance. Despite these challenges, our integrated resorts experienced a moderate recovery in business levels during the fourth quarter.

“While we are encouraged by the recent positive developments, ensuring the safety and well-being of our colleagues, customers and communities in which we operate remains our highest priority. Melco also fully supports the Macau SAR government’s scheme for tourists from Mainland China with the aim to expand the number of visitors, boost the economy, and protect local jobs. In support of the scheme, Melco strives to continue prioritizing epidemic prevention measures by working hand-in-hand with local small and medium enterprise (SME) partners, while contributing collaboratively to the city’s sustainable development and economic recovery.

“We continue to prudently manage our balance sheet. As of December 31, 2020, we had cash on hand of approximately US$1.8 billion, and undrawn revolver capacities of approximately US$2.0 billion. In January, Studio City issued US$750 million of 5.00% senior notes due in 2029, and Melco issued an additional US$250 million from the 5.375% 2029 senior notes. These transactions reduced our average borrowing rate and extended our maturity profile.

“While impacted by COVID-19, Melco remains committed to its global development program. In Macau, construction on the expansion of Studio City is progressing. Upon completion, Studio City will offer approximately 900 additional luxury hotel rooms and suites, one of the world’s largest indoor/outdoor water parks, a Cineplex, fine-dining restaurants, and state-of-the-art MICE space. Also in Macau, our facility upgrade works at City of Dreams are ongoing, with the fully renovated Nϋwa nearing completion. In Europe, we are developing City of Dreams Mediterranean which, upon completion, will be Europe’s largest integrated resort with more than 500 luxury hotel rooms, approximately 10,000 square meters of MICE space, an outdoor amphitheater, a family adventure park, and a variety of fine-dining outlets and luxury retail.

“Turning to Japan, I want to highlight our continued commitment to bring to the country a world-leading IR. We believe our focus on the Asian premium segment, a portfolio of high-quality assets, devotion to craftsmanship, dedication to world-class entertainment offerings, market-leading social safeguard systems, established track record of successful partnerships, culture of exceptional guest service, and a continuing commitment to employee development puts Melco in a strong position to help Japan realize the vision of developing an exceptional IR with a uniquely Japanese touch. Due to COVID, the process in Japan has been delayed and remains complex but has renewed momentum as jurisdictions are again initiating RFP processes. We will continue to be patient as we evaluate the landscape to ensure that Melco pursues the right opportunity that takes advantage of Melco’s core strengths to drive strong value creation.”

For earnings history and earnings-related data on Melco Resorts & Entertainment (MLCO) click here.

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