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China – Wynn Macau set to bloom post-COVID

By - 9 December 2020

Analyst Sanford C. Bernstein is predicting that Wynn Macau’s mix of VIP and mass gaming, along with its expansion at Wynn Palace in Cotai, should see it explode out of the COVID-19 slowdown.

It has highlighted that Wynn Macau’s strength and diversity in operating efficiency should help its rebound.

Sanford Bernstein analysts Vitaly Umansky, Tianjiao Yu and Kelsey Zhu said: “While still viewed as a VIP operator, the reality is Wynn is largely premium-mass driven, with 85 per cent of earnings before interest, taxation, depreciation and amortisation (EBITDA) generated by mass gaming and non-gaming in 2019.”

It believes that by 2023 the company will be able to seize ‘outsized premium mass share’ due to room quality and product offerings with the ‘second highest table yields’ in Macau.

Wynn’s gaming tables generated 23 per cent above the average for VIP gaming tables in Macau in 2019 whilst in mass this was 30 per cent above the average.
“Wynn is targeting a return-on-invested capital (ROIC) of 15 to 20 per cent, which we see as reasonably achievable – assuming no change on gross gaming revenue tax – and we view the expansion as a long-term driver for Wynn.”

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