Studio City drives Q3 results beat for Melco Crown

Melco Crown Entertainment Q3 results beat analysts’ expectations, helped by an improved performance from its Hollywood-themed Studio City resort.

Adjusted EPS was $0.13 per ADS, up from $0.11 per ADS a year earlier and above the $0.07 per ADS consensus. Revenue for Q3 rose 22 percent to $1.15 billion and beat estimates for $1.1 billion. Net revenue at Studio City, which opened in October last year, was $229.5 million.

“Studio City, which opened in October 2015, delivered a sequential increase of over 24 percent in mass table gross gaming revenues and over 110 percent in adjusted property EBITDA, leveraging its unique non-gaming offerings to attract an increasingly Cotai-based mass market customer who are seeking a diverse and multi-faceted entertainment proposition,” Chairman and CEO Lawrence Ho said in a release.

“As trends stabilize in Macau, Melco Crown Entertainment is positioned to benefit from Macau’s evolution into a mass-focused, multi-day stay destination.”

Commenting on the results, Union Gaming said “clearly” Studio City was ramping up, driven by premium mass.

“However, we believe some decent portion of the more recent ramp is coming at the expense of City of Dreams, which is a net negative for MPEL given the lower economic interest it has in SC relative to COD.”

Net revenue at COD was down to $621.2 million in the quarter from $665.6 million in the year-ago period. Revenue at the Mocha Clubs was also lower at $31.8 million from $36.1 million.

City of Dreams Manila saw revenue jump to $131.0 million compared to $91.7 million.

“We believe that the Philippines gaming market will continue to show robust growth as the country’s economy rapidly expands, infrastructure continues to improve and the Philippine government retains its strong commitment to supporting domestic and international tourism,” Ho said.