Melco Announces Record Adjusted Property EBITDA in the Third Quarter 2017 and Declares Quarterly Dividend
MACAU, Nov. 02, 2017 (GLOBE NEWSWIRE) -- Melco Resorts & Entertainment Limited (Nasdaq: MLCO), a developer, owner and operator of casino gaming and entertainment casino resort facilities in Asia, today reported its unaudited financial results for the third quarter of 2017.
Net revenue for the third quarter of 2017 was US$1,376.8 million, representing an increase of approximately 19% from US$1,152.6 million for the comparable period in 2016. The increase in net revenue was primarily attributable to higher rolling chip revenues at City of Dreams and the commencement of rolling chip operations at Studio City in November 2016.
On a U.S. GAAP basis, operating income for the third quarter of 2017 was US$192.7 million, compared with operating income of US$108.9 million in the third quarter of 2016, representing an increase of 77%.
Adjusted property EBITDA(1) was US$400.2 million for the third quarter of 2017, as compared to Adjusted property EBITDA of US$289.2 million in the third quarter of 2016, representing an increase of 38%. The year-on-year improvement in Adjusted property EBITDA was mainly attributable to better performance in the group-wide rolling chip segment.
On a U.S. GAAP basis, net income attributable to Melco Resorts & Entertainment Limited for the third quarter of 2017 was US$115.9 million, or US$0.24 per ADS, compared with US$62.0 million, or US$0.13 per ADS, in the third quarter of 2016. The net loss attributable to noncontrolling interests during the third quarter of 2017 of US$3.3 million was related to Studio City and City of Dreams Manila.
Mr. Lawrence Ho, our Chairman and Chief Executive Officer, commented, “A strong contribution from all gaming segments, aided by a sustained recovery in Macau and ongoing strength in the fast growing Philippines gaming market, continues to drive our Company's overall profitability which enabled us to deliver our all-time record Adjusted property EBITDA of US$400.2 million in the third quarter of 2017.
“Gaming revenue growth momentum in Macau has remained strong, with October 2017 marking the fifteenth consecutive month of positive year-over-year growth. Looking out, we believe there are multiple drivers of long term growth for Macau, powered by ongoing expansion of the increasingly consumption driven middle-to-upper class in China, improving accessibility into and mobility around Macau, and the continuing build-out of non-gaming amenities, which we believe support an increase in the number of tourists and length of stay.
“Melco continues to pursue quality, sustainable earnings growth by remaining focused on the mass market gaming segment, while remaining committed to managing costs, which is evident in the improvement in EBITDA and EBITDA margins in the third quarter of 2017.
“City of Dreams has once again proven itself to be the unequivocal leader in the premium end of the market, with ongoing improvements in mass table yields despite an increase in new supply in the market. We aim to further solidify our leadership position in the premium segment by embarking on a range of exciting enhancements as part of phase three at City of Dreams, including the opening of Morpheus, which remains on budget and on track to open in the first half of 2018. This ultra-luxury, groundbreaking concept will add approximately 780 luxury hotel rooms, suites and villas as well as incredible food and beverage and other non-gaming amenities. When Morpheus opens, we will also commence the rebranding and redevelopment of The Count:Down, which we believe will seamlessly complement the integrated resort’s already market-leading premium mass and direct VIP gaming amenities and other non-gaming offerings.
“Studio City continues to ramp by delivering improvements in the mass market and rolling chip segments. Going forward, we will continue to refine our product offerings at Studio City with a range of extensive property upgrades planned over the next twelve months, including the planned redevelopment of the House of Magic and enhancements in the accessibility to the property.
“In The Philippines, City of Dreams Manila continues to enjoy strong year-on-year growth across all gaming segments, which enabled the property to deliver over 27% year-over-year growth in Adjusted property EBITDA, despite new supply in the Philippines.
“We continue to focus on new expansion opportunities to deliver long term value for our shareholders, which include the transformational integrated resort opportunity in Japan. We believe that our track record of delivering high quality and unique integrated resorts, our market-leading social safeguard systems, and commitment to being an ideal partner to local governments and communities alike places us in a strong position to compete for a license in this exciting market.
“Lastly, I would want to take this opportunity to express our sympathy to all those who were affected by Typhoon Hato in late August. I send my deepest sympathies to the families who have lost loved ones during the Typhoon. I would also like to express my sincere appreciation to my colleagues who have risen to the challenge of rebuilding our community after Typhoon Hato.” City of Dreams Third Quarter Results
For the quarter ended September 30, 2017, net revenue at City of Dreams was US$715.9 million compared to US$621.2 million in the third quarter of 2016. City of Dreams generated Adjusted EBITDA of US$246.4 million in the third quarter of 2017 compared with Adjusted EBITDA of US$170.4 million in the third quarter of 2016. The year-on-year improvement in Adjusted EBITDA was primarily a result of higher rolling chip revenues and recovery of previously provided doubtful debt, partially offset by lower mass market table games revenues.
Rolling chip volume totaled US$11.2 billion for the third quarter of 2017 versus US$10.6 billion in the third quarter of 2016. The rolling chip win rate was 3.5% in the third quarter of 2017 versus 2.6% in the third quarter of 2016. The expected rolling chip win rate range is 2.7%-3.0%.
Mass market table games drop increased to US$1,145.0 million compared with US$1,096.5 million in the third quarter of 2016. The mass market table games hold percentage was 32.3% in the third quarter of 2017 compared to 34.5% in the third quarter of 2016.
Gaming machine handle for the third quarter of 2017 was US$981.7 million, compared with US$1,002.5 million in the third quarter of 2016. The gaming machine win rate was 3.2% in the third quarter of 2017 versus 3.5% in the third quarter of 2016.
Total non-gaming revenue at City of Dreams in the third quarter of 2017 was US$81.4 million, compared with US$75.6 million in the third quarter of 2016.
Altira Macau Third Quarter Results
For the quarter ended September 30, 2017, net revenue at Altira Macau was US$89.3 million compared to US$128.8 million in the third quarter of 2016. Altira Macau generated negative Adjusted EBITDA of US$5.6 million in the third quarter of 2017 compared with Adjusted EBITDA of US$14.0 million in the third quarter of 2016. The year-on-year decrease in Adjusted EBITDA was primarily a result of decreased casino revenues.
Rolling chip volume totaled US$4.2 billion in the third quarter of 2017 versus US$4.5 billion in the third quarter of 2016. The rolling chip win rate was 2.6% in the third quarter of 2017 versus 3.2% in the third quarter of 2016. The expected rolling chip win rate range is 2.7%-3.0%.
In the mass market table games segment, drop totaled US$112.4 million in the third quarter of 2017, a decrease from US$122.6 million generated in the comparable period in 2016. The mass market table games hold percentage was 15.7% in the third quarter of 2017 compared with 19.8% in the third quarter of 2016.
Gaming machine handle for the third quarter of 2017 was US$11.3 million, compared with US$8.5 million in the third quarter of 2016. The gaming machine win rate was 6.1% in the third quarter of 2017 versus 6.9% in the third quarter of 2016.
Total non-gaming revenue at Altira Macau in the third quarter of 2017 was US$6.8 million compared with US$7.3 million in the third quarter of 2016.
Mocha Clubs Third Quarter Results
Net revenue from Mocha Clubs totaled US$30.2 million in the third quarter of 2017 as compared to US$31.8 million in the third quarter of 2016. Mocha Clubs generated US$6.5 million of Adjusted EBITDA in the third quarter of 2017 compared with US$7.0 million in the same period in 2016.
Gaming machine handle for the third quarter of 2017 was US$628.1 million, compared with US$673.4 million in the third quarter of 2016. The gaming machine win rate was 4.7% in the third quarter of 2017 versus 4.6% in the third quarter of 2016.
Studio City Third Quarter Results
For the quarter ended September 30, 2017, net revenue at Studio City was US$384.5 million compared to US$229.5 million in the third quarter of 2016. Studio City generated Adjusted EBITDA of US$95.6 million in the third quarter of 2017 compared with Adjusted EBITDA of US$52.7 million in the third quarter of 2016. The year-on-year improvement in Adjusted EBITDA was primarily a result of the commencement of rolling chip operations in November 2016 and better performance in the mass market table games segment.
Rolling chip volume totaled US$5.1 billion for the third quarter of 2017. The rolling chip win rate was 4.0% in the third quarter of 2017. The expected rolling chip win rate range is 2.7%-3.0%.
Mass market table games drop increased to US$747.1 million compared with US$657.6 million in the third quarter of 2016. The mass market table games hold percentage was 25.0% in the third quarter of 2017 compared to 25.5% in the third quarter of 2016.
Gaming machine handle for the third quarter of 2017 was US$581.2 million, compared with US$587.9 million in the third quarter of 2016. The gaming machine win rate was 3.3% in the third quarter of 2017 versus 3.9% in the third quarter of 2016.
Total non-gaming revenue at Studio City in the third quarter of 2017 was US$51.9 million, compared with US$58.5 million in the third quarter of 2016.
City of Dreams Manila Third Quarter Results
For the quarter ended September 30, 2017, net revenue at City of Dreams Manila was US$148.2 million compared to US$131.0 million in the third quarter of 2016. City of Dreams Manila generated Adjusted EBITDA of US$57.3 million in the third quarter of 2017 compared to US$45.0 million in the comparable period of 2016. The year-on-year improvement in Adjusted EBITDA was primarily a result of increased casino revenues.
Rolling chip volume totaled US$3.0 billion for the third quarter of 2017 versus US$1.6 billion in the third quarter of 2016. The rolling chip win rate was 2.5% in the third quarter of 2017 versus 4.0% in the third quarter of 2016. The expected rolling chip win rate range is 2.7%-3.0%.
Mass market table games drop increased to US$174.1 million for the third quarter of 2017, compared with US$146.8 million in the third quarter of 2016. The mass market table games hold percentage was 29.9% in the third quarter of 2017 compared to 26.9% in the third quarter of 2016.
Gaming machine handle for the third quarter of 2017 was US$757.3 million, compared with US$597.0 million in the third quarter of 2016. The gaming machine win rate was 5.6% in the third quarter of 2017 versus 5.8% in the third quarter of 2016.
Total non-gaming revenue at City of Dreams Manila in the third quarter of 2017 was US$29.2 million, compared with US$26.3 million in the third quarter of 2016.
Other Factors Affecting Earnings
Total net non-operating expenses for the third quarter of 2017 were US$78.6 million, which mainly included interest expenses, net of capitalized interest of US$57.7 million, other finance costs of US$7.7 million, loss on extinguishment of debt of US$16.9 million and costs associated with debt modification of US$0.9 million. We recorded US$9.1 million of capitalized interest during the third quarter of 2017, relating to the development of Morpheus at City of Dreams.
The year-on-year increase of US$15.0 million in net non-operating expenses was primarily a result of the loss on extinguishment of debt arising from the issuance of the additional US$350.0 million 4.875% senior notes in July 2017 for the refinancing of the US$1 billion Senior Notes issued in 2013 by Melco Resorts Finance Limited.
Depreciation and amortization costs of US$134.0 million were recorded in the third quarter of 2017 of which US$14.3 million was related to the amortization of our gaming subconcession and US$5.7 million was related to the amortization of land use rights.
Financial Position and Capital Expenditure
Total cash and bank balances as of September 30, 2017 were US$1.7 billion, including US$35.6 million of bank deposits with original maturities over three months and US$81.9 million of restricted cash, primarily related to Studio City. Total debt, net of unamortized deferred financing costs at the end of the third quarter of 2017, was US$3.7 billion.
Capital expenditures for the third quarter of 2017 were US$176.0 million, which predominantly related to various projects at City of Dreams, primarily Morpheus.
Dividend Declaration
On November 2, 2017, our Board considered and approved the declaration and payment of a quarterly dividend of US$0.03 per share (equivalent to US$0.09 per ADS) for the third quarter of 2017 (the “Quarterly Dividend”). The Quarterly Dividend will be paid on or about November 30, 2017 to our shareholders whose names appear on the register of members of the Company at the close of business on November 14, 2017 being the record date for determination of entitlements to the Quarterly Dividend.
Conference Call Information
Melco Resorts & Entertainment Limited will hold a conference call to discuss its third quarter 2017 financial results on Thursday, November 2, 2017 at 8:30 a.m. Eastern Time (8:30 p.m. Hong Kong Time). To join the conference call, please use the dial-in details below:
| US Toll Free | 1 866 519 4004 | |
| US Toll / International | 1 845 675 0437 | |
| HK Toll | 852 3018 6771 | |
| HK Toll Free | 800 906 601 | |
| UK Toll Free | 080 8234 6646 | |
| Australia Toll | 61 290 833 212 | |
| Australia Toll Free | 1 800 411 623 | |
| Philippines Toll Free | 1 800 1651 0607 | |
| Passcode | MLCO |
An audio webcast will also be available at http://www.melco-resorts.com.
To access the replay, please use the dial-in details below:
| US Toll Free | 1 855 452 5696 | |||||
| US Toll / International | 1 646 254 3697 | |||||
| HK Toll Free | 800 963 117 | |||||
| Philippines Toll Free | 1 800 1612 0166 | |||||
| Conference ID | 2799329 |
Safe Harbor Statement
This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Melco Resorts & Entertainment Limited (the “Company”) may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. These factors include, but are not limited to, (i) growth of the gaming market and visitations in Macau and the Philippines, (ii) capital and credit market volatility, (iii) local and global economic conditions, (iv) our anticipated growth strategies, (v) gaming authority and other governmental approvals and regulations, and (vi) our future business development, results of operations and financial condition. In some cases, forward-looking statements can be identified by words or phrases such as “may”, “will”, “expect”, “anticipate”, “target”, “aim”, “estimate”, “intend”, “plan”, “believe”, “potential”, “continue”, “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.
Non-GAAP Financial Measures
(1) "Adjusted EBITDA" is earnings before interest, taxes, depreciation, amortization, pre-opening costs, development costs, property charges and other, share-based compensation, payments to the Philippine parties under the cooperative arrangement (the “Philippine Parties”), land rent to Belle Corporation, net gain on disposal of property and equipment to Belle Corporation and other non-operating income and expenses. "Adjusted property EBITDA" is earnings before interest, taxes, depreciation, amortization, pre-opening costs, development costs, property charges and other, share-based compensation, payments to the Philippine Parties, land rent to Belle Corporation, net gain on disposal of property and equipment to Belle Corporation, Corporate and Others expenses and other non-operating income and expenses. Adjusted EBITDA and adjusted property EBITDA are presented exclusively as supplemental disclosures because management believes they are widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses adjusted EBITDA and adjusted property EBITDA as measures of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors. The Company also presents adjusted EBITDA and adjusted property EBITDA because they are used by some investors as ways to measure a company's ability to incur and service debt, make capital expenditures, and meet working capital requirements. Gaming companies have historically reported adjusted EBITDA and adjusted property EBITDA as supplements to financial measures in accordance with U.S. GAAP. However, adjusted EBITDA and adjusted property EBITDA should not be considered as alternatives to operating income as indicators of the Company's performance, as alternatives to cash flows from operating activities as measures of liquidity, or as alternatives to any other measure determined in accordance with U.S. GAAP. Unlike net income, adjusted EBITDA and adjusted property EBITDA do not include depreciation and amortization or interest expense and, therefore, do not reflect current or future capital expenditures or the cost of capital. The Company compensates for these limitations by using adjusted EBITDA and adjusted property EBITDA as only two of several comparative tools, together with U.S. GAAP measurements, to assist in the evaluation of operating performance.
Such U.S. GAAP measurements include operating income, net income, cash flows from operations and cash flow data. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other recurring and nonrecurring charges, which are not reflected in adjusted EBITDA or adjusted property EBITDA. Also, the Company's calculation of adjusted EBITDA and adjusted property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted EBITDA and adjusted property EBITDA with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.
(2) “Adjusted net income” is net income before net gain on disposal of property and equipment to Belle Corporation, pre-opening costs, development costs, property charges and other, loss on extinguishment of debt and costs associated with debt modification, net of noncontrolling interests and taxes calculated using specific tax treatments applicable to the adjustments based on their respective jurisdictions. Adjusted net income attributable to Melco Resorts & Entertainment Limited and adjusted net income attributable to Melco Resorts & Entertainment Limited per share (“EPS”) are presented as supplemental disclosures because management believes they are widely used to measure the performance, and as a basis for valuation, of gaming companies. These measures are used by management and/or evaluated by some investors, in addition to income and EPS computed in accordance with U.S. GAAP, as an additional basis for assessing period-to-period results of our business. Adjusted net income attributable to Melco Resorts & Entertainment Limited and adjusted net income attributable to Melco Resorts & Entertainment Limited per share may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted net income attributable to Melco Resorts & Entertainment Limited with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.
About Melco Resorts & Entertainment Limited
The Company, with its American depositary shares listed on the NASDAQ Global Select Market (NASDAQ: MLCO), is a developer, owner and operator of casino gaming and entertainment casino resort facilities in Asia. The Company currently operates Altira Macau (www.altiramacau.com), a casino hotel located at Taipa, Macau and City of Dreams (www.cityofdreamsmacau.com), an integrated urban casino resort located in Cotai, Macau. Its business also includes the Mocha Clubs (www.mochaclubs.com), which comprise the largest non-casino based operations of electronic gaming machines in Macau. The Company also majority owns and operates Studio City (www.studiocity-macau.com), a cinematically-themed integrated entertainment, retail and gaming resort in Cotai, Macau. In the Philippines, a Philippine subsidiary of the Company currently operates and manages City of Dreams Manila (www.cityofdreams.com.ph), a casino, hotel, retail and entertainment integrated resort in the Entertainment City complex in Manila. For more information about the Company, please visit www.melco-resorts.com.
The Company is strongly supported by its single largest shareholder, Melco International Development Limited, a company listed on the Main Board of The Stock Exchange of Hong Kong Limited and is substantially owned and led by Mr. Lawrence Ho, who is the Chairman, Executive Director and Chief Executive Officer of the Company.
| Melco Resorts & Entertainment Limited and Subsidiaries | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (In thousands of U.S. dollars, except share and per share data) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||
| OPERATING REVENUES | |||||||||||||||
| Casino | $ | 1,285,107 | $ | 1,060,035 | $ | 3,688,084 | $ | 3,076,823 | |||||||
| Rooms | 68,310 | 68,082 | 200,336 | 195,951 | |||||||||||
| Food and beverage | 45,196 | 47,240 | 133,706 | 129,611 | |||||||||||
| Entertainment, retail and other | 57,357 | 54,063 | 159,839 | 145,118 | |||||||||||
| Gross revenues | 1,455,970 | 1,229,420 | 4,181,965 | 3,547,503 | |||||||||||
| Less: promotional allowances | (79,143 | ) | (76,867 | ) | (229,698 | ) | (220,985 | ) | |||||||
| Net revenues | 1,376,827 | 1,152,553 | 3,952,267 | 3,326,518 | |||||||||||
| OPERATING COSTS AND EXPENSES | |||||||||||||||
| Casino | (861,518 | ) | (733,997 | ) | (2,508,949 | ) | (2,154,024 | ) | |||||||
| Rooms | (8,037 | ) | (8,537 | ) | (24,252 | ) | (24,958 | ) | |||||||
| Food and beverage | (13,629 | ) | (13,074 | ) | (41,871 | ) | (47,569 | ) | |||||||
| Entertainment, retail and other | (22,604 | ) | (27,865 | ) | (66,656 | ) | (82,491 | ) | |||||||
| General and administrative | (110,924 | ) | (112,065 | ) | (344,505 | ) | (326,081 | ) | |||||||
| Payments to the Philippine Parties | (13,288 | ) | (9,066 | ) | (42,549 | ) | (24,475 | ) | |||||||
| Pre-opening costs | (177 | ) | (1,489 | ) | (1,177 | ) | (2,212 | ) | |||||||
| Development costs | (14,054 | ) | - | (18,139 | ) | (7 | ) | ||||||||
| Amortization of gaming subconcession | (14,310 | ) | (14,309 | ) | (42,928 | ) | (42,928 | ) | |||||||
| Amortization of land use rights | (5,704 | ) | (5,704 | ) | (17,112 | ) | (17,112 | ) | |||||||
| Depreciation and amortization | (113,991 | ) | (117,059 | ) | (347,070 | ) | (354,704 | ) | |||||||
| Property charges and other | (5,874 | ) | (451 | ) | (18,401 | ) | (2,809 | ) | |||||||
| Total operating costs and expenses | (1,184,110 | ) | (1,043,616 | ) | (3,473,609 | ) | (3,079,370 | ) | |||||||
| OPERATING INCOME | 192,717 | 108,937 | 478,658 | 247,148 | |||||||||||
| NON-OPERATING INCOME (EXPENSES) | |||||||||||||||
| Interest income | 1,025 | 1,210 | 2,497 | 4,213 | |||||||||||
| Interest expenses, net of capitalized interest | (57,744 | ) | (56,378 | ) | (174,849 | ) | (167,397 | ) | |||||||
| Other finance costs | (7,676 | ) | (14,549 | ) | (24,728 | ) | (42,452 | ) | |||||||
| Foreign exchange gains, net | 2,793 | 5,245 | 12,191 | 10,275 | |||||||||||
| Other income, net | 870 | 917 | 2,258 | 2,636 | |||||||||||
| Loss on extinguishment of debt | (16,939 | ) | - | (48,398 | ) | - | |||||||||
| Costs associated with debt modification | (881 | ) | - | (2,793 | ) | - | |||||||||
| Total non-operating expenses, net | (78,552 | ) | (63,555 | ) | (233,822 | ) | (192,725 | ) | |||||||
| INCOME BEFORE INCOME TAX | 114,165 | 45,382 | 244,836 | 54,423 | |||||||||||
| INCOME TAX EXPENSE | (1,552 | ) | (1,662 | ) | (935 | ) | (4,016 | ) | |||||||
| NET INCOME | 112,613 | 43,720 | 243,901 | 50,407 | |||||||||||
| NET LOSS ATTRIBUTABLE TO | |||||||||||||||
| NONCONTROLLING INTERESTS | 3,294 | 18,323 | 21,929 | 82,223 | |||||||||||
| NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED | $ | 115,907 | $ | 62,043 | $ | 265,830 | $ | 132,630 | |||||||
| NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED PER SHARE: | |||||||||||||||
| Basic | $ | 0.079 | $ | 0.042 | $ | 0.181 | $ | 0.086 | |||||||
| Diluted | $ | 0.078 | $ | 0.042 | $ | 0.180 | $ | 0.086 | |||||||
| NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED PER ADS: | |||||||||||||||
| Basic | $ | 0.237 | $ | 0.127 | $ | 0.544 | $ | 0.259 | |||||||
| Diluted | $ | 0.235 | $ | 0.126 | $ | 0.539 | $ | 0.258 | |||||||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||||
| USED IN NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED | |||||||||||||||
| PER SHARE CALCULATION: | |||||||||||||||
| Basic | 1,468,293,998 | 1,463,450,519 | 1,467,083,364 | 1,534,527,893 | |||||||||||
| Diluted | 1,479,677,417 | 1,471,515,182 | 1,478,440,011 | 1,542,641,243 | |||||||||||
| Melco Resorts & Entertainment Limited and Subsidiaries | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (In thousands of U.S. dollars) | |||||||
| September 30, | December 31, | ||||||
| 2017 | 2016 | ||||||
| (Unaudited) | (Audited) | ||||||
| ASSETS | |||||||
| CURRENT ASSETS | |||||||
| Cash and cash equivalents | $ | 1,576,898 | $ | 1,702,310 | |||
| Bank deposits with original maturities over three months | 35,591 | 210,840 | |||||
| Restricted cash | 81,735 | 39,152 | |||||
| Accounts receivable, net | 137,731 | 225,438 | |||||
| Amounts due from affiliated companies | 373 | 1,103 | |||||
| Inventories | 33,646 | 32,600 | |||||
| Prepaid expenses and other current assets | 62,971 | 68,111 | |||||
| Total current assets | 1,928,945 | 2,279,554 | |||||
| PROPERTY AND EQUIPMENT, NET | 5,685,386 | 5,655,823 | |||||
| GAMING SUBCONCESSION, NET | 270,392 | 313,320 | |||||
| INTANGIBLE ASSETS | 4,220 | 4,220 | |||||
| GOODWILL | 81,915 | 81,915 | |||||
| LONG-TERM PREPAYMENTS, DEPOSITS AND OTHER ASSETS | 188,447 | 194,911 | |||||
| RESTRICTED CASH | 130 | 130 | |||||
| DEFERRED TAX ASSETS | 246 | 152 | |||||
| LAND USE RIGHTS, NET | 793,204 | 810,316 | |||||
| TOTAL ASSETS | $ | 8,952,885 | $ | 9,340,341 | |||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
| CURRENT LIABILITIES | |||||||
| Accounts payable | $ | 17,267 | $ | 17,434 | |||
| Accrued expenses and other current liabilities | 1,514,948 | 1,369,943 | |||||
| Income tax payable | 5,868 | 7,422 | |||||
| Capital lease obligations, due within one year | 32,042 | 30,730 | |||||
| Current portion of long-term debt, net | 196,788 | 50,583 | |||||
| Amounts due to affiliated companies | 11,831 | 3,028 | |||||
| Total current liabilities | 1,778,744 | 1,479,140 | |||||
| LONG-TERM DEBT, NET | 3,512,524 | 3,669,692 | |||||
| OTHER LONG-TERM LIABILITIES | 44,276 | 49,287 | |||||
| DEFERRED TAX LIABILITIES | 56,104 | 56,451 | |||||
| CAPITAL LEASE OBLIGATIONS, DUE AFTER ONE YEAR | 258,675 | 262,357 | |||||
| AMOUNT DUE TO AN AFFILIATED COMPANY | 910 | - | |||||
| SHAREHOLDERS' EQUITY | |||||||
| Ordinary shares | 14,784 | 14,759 | |||||
| Treasury shares | (92 | ) | (108 | ) | |||
| Additional paid-in capital | 3,666,393 | 2,783,062 | |||||
| Accumulated other comprehensive losses | (26,506 | ) | (24,768 | ) | |||
| (Accumulated losses) retained earnings | (809,430 | ) | 570,925 | ||||
| Total Melco Resorts & Entertainment Limited shareholders’ equity | 2,845,149 | 3,343,870 | |||||
| Noncontrolling interests | 456,503 | 479,544 | |||||
| Total equity | 3,301,652 | 3,823,414 | |||||
| TOTAL LIABILITIES AND EQUITY | $ | 8,952,885 | $ | 9,340,341 | |||
| Melco Resorts & Entertainment Limited and Subsidiaries | |||||||||||||||
| Reconciliation of Net Income Attributable to Melco Resorts & Entertainment Limited to | |||||||||||||||
| Adjusted Net Income Attributable to Melco Resorts & Entertainment Limited | |||||||||||||||
| (In thousands of U.S. dollars, except share and per share data) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||
| Net Income Attributable to | |||||||||||||||
| Melco Resorts & Entertainment Limited | $ | 115,907 | $ | 62,043 | $ | 265,830 | $ | 132,630 | |||||||
| Net Gain on Disposal of Property and Equipment | |||||||||||||||
| to Belle Corporation | - | - | - | (8,134 | ) | ||||||||||
| Pre-opening Costs | 177 | 1,489 | 1,177 | 2,212 | |||||||||||
| Development Costs | 14,054 | - | 18,139 | 7 | |||||||||||
| Property Charges and Other | 5,874 | 451 | 18,401 | 2,809 | |||||||||||
| Loss on Extinguishment of Debt | 16,939 | - | 48,398 | - | |||||||||||
| Costs Associated with Debt Modification | 881 | - | 2,793 | - | |||||||||||
| Income Tax Impact on Adjustments | 86 | - | (262 | ) | (14 | ) | |||||||||
| Noncontrolling Interests Impact on Adjustments | (922 | ) | (1,181 | ) | (2,674 | ) | 344 | ||||||||
| Adjusted Net Income Attributable to | |||||||||||||||
| Melco Resorts & Entertainment Limited | $ | 152,996 | $ | 62,802 | $ | 351,802 | $ | 129,854 | |||||||
| ADJUSTED NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED PER SHARE: | |||||||||||||||
| Basic | $ | 0.104 | $ | 0.043 | $ | 0.240 | $ | 0.085 | |||||||
| Diluted | $ | 0.103 | $ | 0.043 | $ | 0.238 | $ | 0.084 | |||||||
| ADJUSTED NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED PER ADS: | |||||||||||||||
| Basic | $ | 0.313 | $ | 0.129 | $ | 0.719 | $ | 0.254 | |||||||
| Diluted | $ | 0.310 | $ | 0.128 | $ | 0.714 | $ | 0.253 | |||||||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||||
| USED IN ADJUSTED NET INCOME ATTRIBUTABLE TO | |||||||||||||||
| MELCO RESORTS & ENTERTAINMENT LIMITED | |||||||||||||||
| PER SHARE CALCULATION: | |||||||||||||||
| Basic | 1,468,293,998 | 1,463,450,519 | 1,467,083,364 | 1,534,527,893 | |||||||||||
| Diluted | 1,479,677,417 | 1,471,515,182 | 1,478,440,011 | 1,542,641,243 | |||||||||||
| Melco Resorts & Entertainment Limited and Subsidiaries | ||||||||||||||||||||||||
| Reconciliation of Operating Income (Loss) to Adjusted EBITDA and Adjusted Property EBITDA | ||||||||||||||||||||||||
| (In thousands of U.S. dollars) | ||||||||||||||||||||||||
| Three Months Ended September 30, 2017 | ||||||||||||||||||||||||
| Altira Macau | Mocha | City of Dreams | Studio City | City ofDreamsManila | Corporateand Others | Total | ||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
| Operating (Loss) Income | $ | (10,973 | ) | $ | 4,752 | $ | 200,729 | $ | 46,006 | $ | 22,266 | $ | (70,063 | ) | $ | 192,717 | ||||||||
| Payments to the Philippine Parties | - | - | - | - | 13,288 | - | 13,288 | |||||||||||||||||
| Land Rent to Belle Corporation | - | - | - | - | 778 | - | 778 | |||||||||||||||||
| Pre-opening Costs | - | - | 152 | 25 | - | - | 177 | |||||||||||||||||
| Development Costs | - | - | - | - | - | 14,054 | 14,054 | |||||||||||||||||
| Depreciation and Amortization | 5,101 | 1,990 | 42,082 | 46,077 | 20,722 | 18,033 | 134,005 | |||||||||||||||||
| Share-based Compensation | 68 | 49 | 822 | 322 | 196 | 3,817 | 5,274 | |||||||||||||||||
| Property Charges and Other | 197 | (270 | ) | 2,586 | 3,207 | - | 154 | 5,874 | ||||||||||||||||
| Adjusted EBITDA | (5,607 | ) | 6,521 | 246,371 | 95,637 | 57,250 | (34,005 | ) | 366,167 | |||||||||||||||
| Corporate and Others Expenses | - | - | - | - | - | 34,005 | 34,005 | |||||||||||||||||
| Adjusted Property EBITDA | $ | (5,607 | ) | $ | 6,521 | $ | 246,371 | $ | 95,637 | $ | 57,250 | $ | - | $ | 400,172 | |||||||||
| Three Months Ended September 30, 2016 | ||||||||||||||||||||||||
| Altira Macau | Mocha | City of Dreams | Studio City | City ofDreamsManila | Corporateand Others | Total | ||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
| Operating Income (Loss) | $ | 8,284 | $ | 3,948 | $ | 125,753 | $ | 5,913 | $ | 13,098 | $ | (48,059 | ) | $ | 108,937 | |||||||||
| Payments to the Philippine Parties | - | - | - | - | 9,066 | - | 9,066 | |||||||||||||||||
| Land Rent to Belle Corporation | - | - | - | - | 838 | - | 838 | |||||||||||||||||
| Pre-opening Costs | - | - | 6 | 1,483 | - | - | 1,489 | |||||||||||||||||
| Depreciation and Amortization | 5,718 | 3,038 | 43,888 | 44,794 | 22,038 | 17,596 | 137,072 | |||||||||||||||||
| Share-based Compensation | 45 | 47 | 712 | 304 | (61 | ) | 3,417 | 4,464 | ||||||||||||||||
| Property Charges and Other | - | - | - | 212 | 33 | 206 | 451 | |||||||||||||||||
| Adjusted EBITDA | 14,047 | 7,033 | 170,359 | 52,706 | 45,012 | (26,840 | ) | 262,317 | ||||||||||||||||
| Corporate and Others Expenses | - | - | - | - | - | 26,840 | 26,840 | |||||||||||||||||
| Adjusted Property EBITDA | $ | 14,047 | $ | 7,033 | $ | 170,359 | $ | 52,706 | $ | 45,012 | $ | - | $ | 289,157 | ||||||||||
| Melco Resorts & Entertainment Limited and Subsidiaries | ||||||||||||||||||||||||||
| Reconciliation of Operating Income (Loss) to Adjusted EBITDA and Adjusted Property EBITDA | ||||||||||||||||||||||||||
| (In thousands of U.S. dollars) | ||||||||||||||||||||||||||
| Nine Months Ended September 30, 2017 | ||||||||||||||||||||||||||
| Altira Macau | Mocha | City of Dreams | Studio City | City ofDreamsManila | Corporateand Others | Total | ||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||
| Operating (Loss) Income | $ | (13,188 | ) | $ | 13,092 | $ | 492,973 | $ | 97,332 | $ | 72,664 | $ | (184,215 | ) | $ | 478,658 | ||||||||||
| Payments to the Philippine Parties | - | - | - | - | 42,549 | - | 42,549 | |||||||||||||||||||
| Land Rent to Belle Corporation | - | - | - | - | 2,361 | - | 2,361 | |||||||||||||||||||
| Pre-opening Costs | - | - | 967 | (15 | ) | 225 | - | 1,177 | ||||||||||||||||||
| Development Costs | - | - | - | - | - | 18,139 | 18,139 | |||||||||||||||||||
| Depreciation and Amortization | 15,998 | 6,222 | 130,434 | 138,375 | 63,158 | 52,923 | 407,110 | |||||||||||||||||||
| Share-based Compensation | 150 | 97 | 2,106 | 927 | 269 | 8,546 | 12,095 | |||||||||||||||||||
| Property Charges and Other | 254 | (208 | ) | 8,715 | 7,474 | - | 2,166 | 18,401 | ||||||||||||||||||
| Adjusted EBITDA | 3,214 | 19,203 | 635,195 | 244,093 | 181,226 | (102,441 | ) | 980,490 | ||||||||||||||||||
| Corporate and Others Expenses | - | - | - | - | - | 102,441 | 102,441 | |||||||||||||||||||
| Adjusted Property EBITDA | $ | 3,214 | $ | 19,203 | $ | 635,195 | $ | 244,093 | $ | 181,226 | $ | - | $ | 1,082,931 | ||||||||||||
| Nine Months Ended September 30, 2016 | ||||||||||||||||||||||||||
| Altira Macau | Mocha | City of Dreams | Studio City | City ofDreamsManila | Corporateand Others | Total | ||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||
| Operating (Loss) Income | $ | (15,681 | ) | $ | 9,101 | $ | 420,191 | $ | (38,472 | ) | $ | 18,788 | $ | (146,779 | ) | $ | 247,148 | |||||||||
| Payments to the Philippine Parties | - | - | - | - | 24,475 | - | 24,475 | |||||||||||||||||||
| Land Rent to Belle Corporation | - | - | - | - | 2,524 | - | 2,524 | |||||||||||||||||||
| Net Gain on Disposal of Property and Equipment | ||||||||||||||||||||||||||
| to Belle Corporation | - | - | - | - | (8,134 | ) | - | (8,134 | ) | |||||||||||||||||
| Pre-opening Costs | - | - | 308 | 1,904 | - | - | 2,212 | |||||||||||||||||||
| Development Costs | - | - | - | - | - | 7 | 7 | |||||||||||||||||||
| Depreciation and Amortization | 17,298 | 9,124 | 131,171 | 134,259 | 69,946 | 52,946 | 414,744 | |||||||||||||||||||
| Share-based Compensation | 15 | 129 | 1,753 | 746 | 1,970 | 10,135 | 14,748 | |||||||||||||||||||
| Property Charges and Other | 197 | - | 191 | 894 | 567 | 960 | 2,809 | |||||||||||||||||||
| Adjusted EBITDA | 1,829 | 18,354 | 553,614 | 99,331 | 110,136 | (82,731 | ) | 700,533 | ||||||||||||||||||
| Corporate and Others Expenses | - | - | - | - | - | 82,731 | 82,731 | |||||||||||||||||||
| Adjusted Property EBITDA | $ | 1,829 | $ | 18,354 | $ | 553,614 | $ | 99,331 | $ | 110,136 | $ | - | $ | 783,264 | ||||||||||||
| Melco Resorts & Entertainment Limited and Subsidiaries | |||||||||||||||
| Reconciliation of Net Income Attributable to Melco Resorts & Entertainment Limited to | |||||||||||||||
| Adjusted EBITDA and Adjusted Property EBITDA | |||||||||||||||
| (In thousands of U.S. dollars) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||
| Net Income Attributable to Melco Resorts & Entertainment Limited | $ | 115,907 | $ | 62,043 | $ | 265,830 | $ | 132,630 | |||||||
| Net Loss Attributable to Noncontrolling Interests | (3,294 | ) | (18,323 | ) | (21,929 | ) | (82,223 | ) | |||||||
| Net Income | 112,613 | 43,720 | 243,901 | 50,407 | |||||||||||
| Income Tax Expense | 1,552 | 1,662 | 935 | 4,016 | |||||||||||
| Interest and Other Non-Operating Expenses, Net | 78,552 | 63,555 | 233,822 | 192,725 | |||||||||||
| Property Charges and Other | 5,874 | 451 | 18,401 | 2,809 | |||||||||||
| Share-based Compensation | 5,274 | 4,464 | 12,095 | 14,748 | |||||||||||
| Depreciation and Amortization | 134,005 | 137,072 | 407,110 | 414,744 | |||||||||||
| Development Costs | 14,054 | - | 18,139 | 7 | |||||||||||
| Pre-opening Costs | 177 | 1,489 | 1,177 | 2,212 | |||||||||||
| Net Gain on Disposal of Property and Equipment | |||||||||||||||
| to Belle Corporation | - | - | - | (8,134 | ) | ||||||||||
| Land Rent to Belle Corporation | 778 | 838 | 2,361 | 2,524 | |||||||||||
| Payments to the Philippine Parties | 13,288 | 9,066 | 42,549 | 24,475 | |||||||||||
| Adjusted EBITDA | 366,167 | 262,317 | 980,490 | 700,533 | |||||||||||
| Corporate and Others Expenses | 34,005 | 26,840 | 102,441 | 82,731 | |||||||||||
| Adjusted Property EBITDA | $ | 400,172 | $ | 289,157 | $ | 1,082,931 | $ | 783,264 | |||||||
| Melco Resorts & Entertainment Limited and Subsidiaries | ||||||||||||||||||||
| Supplemental Data Schedule | ||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
| Room Statistics: | ||||||||||||||||||||
| Altira Macau | ||||||||||||||||||||
| Average daily rate (3) | $ | 201 | $ | 200 | $ | 203 | $ | 204 | ||||||||||||
| Occupancy per available room | 98 | % | 96 | % | 95 | % | 94 | % | ||||||||||||
| Revenue per available room (4) | $ | 197 | $ | 192 | $ | 193 | $ | 192 | ||||||||||||
| City of Dreams | ||||||||||||||||||||
| Average daily rate (3) | $ | 201 | $ | 199 | $ | 200 | $ | 198 | ||||||||||||
| Occupancy per available room | 97 | % | 97 | % | 97 | % | 95 | % | ||||||||||||
| Revenue per available room (4) | $ | 195 | $ | 193 | $ | 194 | $ | 189 | ||||||||||||
| Studio City | ||||||||||||||||||||
| Average daily rate (3) | $ | 142 | $ | 137 | $ | 139 | $ | 135 | ||||||||||||
| Occupancy per available room | 98 | % | 99 | % | 98 | % | 97 | % | ||||||||||||
| Revenue per available room (4) | $ | 139 | $ | 136 | $ | 137 | $ | 131 | ||||||||||||
| City of Dreams Manila | ||||||||||||||||||||
| Average daily rate (3) | $ | 158 | $ | 158 | $ | 156 | $ | 161 | ||||||||||||
| Occupancy per available room | 96 | % | 92 | % | 96 | % | 90 | % | ||||||||||||
| Revenue per available room (4) | $ | 151 | $ | 146 | $ | 150 | $ | 144 | ||||||||||||
| Other Information: | ||||||||||||||||||||
| Altira Macau | ||||||||||||||||||||
| Average number of table games | 101 | 117 | 108 | 123 | ||||||||||||||||
| Average number of gaming machines | 61 | 61 | 58 | 62 | ||||||||||||||||
| Table games win per unit per day (5) | $ | 13,707 | $ | 15,745 | $ | 14,225 | $ | 13,448 | ||||||||||||
| Gaming machines win per unit per day (6) | $ | 123 | $ | 104 | $ | 103 | $ | 93 | ||||||||||||
| City of Dreams | ||||||||||||||||||||
| Average number of table games | 476 | 489 | 479 | 496 | ||||||||||||||||
| Average number of gaming machines | 673 | 1,037 | 758 | 1,054 | ||||||||||||||||
| Table games win per unit per day (5) | $ | 17,459 | $ | 14,471 | $ | 16,878 | $ | 14,931 | ||||||||||||
| Gaming machines win per unit per day (6) | $ | 506 | $ | 363 | $ | 504 | $ | 355 | ||||||||||||
| Studio City | ||||||||||||||||||||
| Average number of table games | 291 | 245 | 287 | 245 | ||||||||||||||||
| Average number of gaming machines | 970 | 1,098 | 974 | 1,095 | ||||||||||||||||
| Table games win per unit per day (5) | $ | 14,535 | $ | 7,446 | $ | 12,521 | $ | 6,358 | ||||||||||||
| Gaming machines win per unit per day (6) | $ | 214 | $ | 229 | $ | 211 | $ | 186 | ||||||||||||
| City of Dreams Manila | ||||||||||||||||||||
| Average number of table games | 290 | 262 | 280 | 269 | ||||||||||||||||
| Average number of gaming machines | 1,792 | 1,656 | 1,781 | 1,646 | ||||||||||||||||
| Table games win per unit per day (5) | $ | 4,705 | $ | 4,237 | $ | 5,417 | $ | 3,723 | ||||||||||||
| Gaming machines win per unit per day (6) | $ | 256 | $ | 226 | $ | 272 | $ | 204 | ||||||||||||
| (3) Average daily rate is calculated by dividing total room revenue including the retail value of promotional allowances by total occupied rooms including complimentary rooms | ||||||||||||||||||||
| (4) Revenue per available room is calculated by dividing total room revenue including the retail value of promotional allowances by total rooms available | ||||||||||||||||||||
| (5) Table games win per unit per day is shown before discounts and commissions | ||||||||||||||||||||
| (6) Gaming machines win per unit per day is shown before deducting cost for slot points | ||||||||||||||||||||
For investment community, please contact: Ross DunwoodyVice President, Development & Investor RelationsTel: +853 8868 7575 or +852 2598 3689Email: [email protected]
Richard HuangDirector, Investor RelationsTel: +852 2598 3619Email: [email protected]
For media enquiries, please contact:Chimmy LeungExecutive Director, Corporate CommunicationsTel: +852 3151 3765Email: [email protected]
Source: Melco Resorts & Entertainment Limited