Melco Resorts operating revenues with 41pct y-o-y drop in Q1

Gaming operator Melco Resorts & Entertainment Limited has reported a 41 per cent year-on-year drop in operating revenues for the first quarter of this year to some US$810 million (MOP6.4 billion), with Adjusted Property EBITDA cut by 82 per cent to some US$75.3 million, the company announced.

The company also recorded US$364 million in net losses for the period, after registering US$120.1 million in net profits for the same period of last year.

As with the remaining gaming concessionaires in the city, negative results were attributed to the temporary casino closure in Macau in February and enhanced quarantine and social distancing measures to mitigate the Covid-19 outbreak in the first quarter of this year.

‘The Covid-19 outbreak has also impacted the construction of the Studio City Phase 2 project and the progress of construction works at the City of Dreams Mediterranean project. We currently expect additional time will be needed to complete the construction of both projects,’ the group noted.

Still, Melco’s CEO, Lawrence Ho, stated the group continues to ‘manage its balance sheet in a prudent manner’ and had some US$1.2 billion in cash and cash equivalents.

‘With the entry into a new senior facilities agreement in April 2020, we have undrawn revolver capacity of approximately US$1.6 billion. In addition, we further bolstered our balance sheet with our sale of the shares we held in Crown Resorts Limited, resulting in gross sales proceeds of approximately US$355 million,’ the group noted.

The group recently sold its remaining 9.99 per cent share in Crown to investment firm Blackstone Group.

The group also decided to suspend its quarterly dividend program so as ‘to preserve liquidity’ and to ‘continue investing in our business’.

‘Melco remains committed to returning capital to shareholders with a regular quarterly dividend and will evaluate the resumption of its quarterly dividend as the operating environment evolves,’ Ho added in the financial report.

Last month it was also reported that several executives in senior positions across different departments of Melco had voluntarily departed their positions, with the group’s corporate executive team to reduce its aggregate of salary payments by 33 per cent for the remainder of this year.