Coming Later This Month; A Highly Anticipated Earnings Report
Type messageQ2 will be the first quarterly report where a lot of things have the potential to fall into place.
Un-opened portions of Cotai Central were always a drag on the resort through Q1 of this year. In Q2, we'll have the first quarter that it's fully opened... the first quarter where all expenses have offsetting revenue sources.
Similarly, Venetian should experience the full impact of the 6,000 new rooms across the skybridge at Cotai Central. Venetian's ancillary attractions should get a significant boost to their thus-far, under-utilized capacity. MICE activity has definately picked up, and the shortage of hotel rooms on the peninsula is pushing occupancy on the strip. The growth has been in mass markets, and table minimums have surged significantly.
In Vegas, MGM has talked incessantly about a surge in business. Like last year, non-gaming has been strongest, but this year, capacities are becoming strained, so margins, rev-pars and table minimums are moving higher. MGM's plans to build a 2nd arena underscore their confidence in Vegas as a non-gaming draw.
Singapore has been strong... it's just that gaming revenues havn't reflected it. VIP gaming volumes surged 64% and 46% in Q4 and Q1 respectively, and that is the measure of gaming growth. Revenues have sagged simply because the resort has played unlucky on a normalized basis... Q4 actually recorded the worst table hold in the resort's 3 year history. If volumes are sustained and luck normalizes, look for an additional $100 to $120 million of EBITDA from Marina Bay over recent quarters.
I see aggregate analyst's estimates as unusually low, given the positives. The 67 cent aggregate estimate is conservative and reflect's the horrible miss in Q2, 2012 as well as the company's propensity to ramp resorts slowly, as Cotai Central currently is and 4-seasons did years ago.
My estimate is 74 cents for Q2 with a raw, un-normalized range of 70 to 78 cents. Unlike analysts, I don't get punished for being wrong.