Macau’s gaming industry faced major challenges during the pandemic due to strict restrictions, but has shown significant recovery after travel restrictions were lifted in early 2023.
According to Fitch, mass-market baccarat in Macau has returned to pre-pandemic levels, especially in the premium mass market that Wynn focuses on. In 2023, mass-market baccarat reached 91% of 2019’s numbers, with Q4 2023 exceeding Q4 2019.
Although visitation and airline capacity are still below 2019 levels, there is potential for further revenue growth in the industry. Wynn’s Macau operations alone generated $910.6m in Q4, with $524.4m coming from Wynn Palace.
Fitch predicts that Wynn’s financial performance will improve, with EBITDAR leverage expected to decrease from just under 7x in 2023 to low-5x by 2025. Wynn’s liquidity position is strong, with $2.8bn in cash and positive free cash flow forecasted.
Despite reducing its US operations, Wynn is still active in Nevada, with Las Vegas revenue seeing a 16.3% increase in 2023. Wynn’s success in Macau and future projects in Las Vegas and the United Arab Emirates are expected to further enhance its credit position.
Penn Entertainment recently acquired Wynn’s sports betting licenses in New York, paving the way for the launch of ESPN Bet in the state in 2024. Wynn’s focus on premium markets and strategic partnerships position it well for continued success in the global gaming industry.
