Wynn Macau Ltd. · HKEX:1128

Wynn Macau — Investor Day (July 2019)

79 slides from Wynn Macau's investor day presentation, July 2019

  1. Slide 1: Important

    IMPORTANT This presentation was prepared by Wynn Resorts, Limited, the controlling shareholder of Wynn Macau, Limited (the “Company”) and not by the Company. The Company takes no responsibility for the contents of this presentation, and expressly disclaim any liability whatsoever for any loss howsoe

  2. Slide 2: Analyst and Investor Day July 2019

    ANALYST AND INVESTOR DAY JULY 2019

  3. Slide 3: Forward-Looking Statements

    FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements regarding operating trends, future results of operations and the completion of new projects, based upon beliefs and assumptions of our management and on information currently available to us, all of which are subject to

  4. Slide 4: Agenda

    AGENDA  Our Journey in 2018 and 2019  The Industry’s Best Growth Pipeline  Contributing to the Development of the Greater Bay Area  Doubling Down on Our Leading Las Vegas Positioning  Introducing the East Coast’s First 5-Star Integrated Resort  Looking Forward to 2021  Our Capital Allocation

  5. Slide 5: Today's Presenters

    TODAY’S PRESENTERS Matt Maddox Craig Billings Linda Chen CEO President & CFO Vice Chairman Wynn Resorts Wynn Resorts Wynn Macau, Limited Ian Coughlan Bob DeSalvio Marilyn Spiegel President President President Wynn Macau, Limited Encore Boston Harbor Wynn Las Vegas 4

  6. Slide 6: Combining the Industry's Best Service and Facilities

    COMBINING THE INDUSTRY’S BEST SERVICE AND FACILITIES 1 Preeminent designer, developer, and operator of integrated resorts, incorporating luxury hotel rooms, high-end retail, an array of dining and entertainment options, meeting space, and gaming, all supported by superior levels of customer service

  7. Slide 7: Our Journey in 2018 and 2019

    Our Journey in 2018 and 2019

  8. Slide 8: We Underwent Significant Transformation in 2018

    WE UNDERWENT SIGNIFICANT TRANSFORMATION IN 2018  The Company responded quickly and decisively to the adverse events of early 2018  Transformed from a founder-led organization to a global enterprise, overseen by a refreshed and independent Board of Directors  Strong executive team, reaffirmed comm

  9. Slide 9: Preserving and Expanding Our Brand Premium

    PRESERVING AND EXPANDING OUR BRAND PREMIUM 8

  10. Slide 10: WDD – Full Cycle Design & Development

    WDD – FULL CYCLE DESIGN & DEVELOPMENT CAPABILITIES Architectural Design Interior Design Construction Management  30+ years of experience designing the  Our capabilities in interior design  Decades of experience overseeing world’s most iconic integrated resorts transformed the industry, establishi

  11. Slide 11: WDD Leadership Spotlight: Todd Lenahan

    WDD LEADERSHIP SPOTLIGHT: TODD LENAHAN Todd and his firm have been our primary external design partner, contributing to the creation of iconic Wynn designs Selected projects include: Las Vegas Macau Development  Encore Tower  SW Steakhouse  Wynn Japan IR  Encore Spa &  Wynn Palace Spa design Sa

  12. Slide 12: Our Core Values Underpin the Industry's Best Service Levels

    OUR CORE VALUES UNDERPIN THE INDUSTRY’S BEST SERVICE LEVELS 11

  13. Slide 13: Highest-Scoring Luxury Hotel Brand by Forbes

    WYNN RESORTS WAS RATED THE HIGHEST-SCORING LUXURY HOTEL BRAND IN THE WORLD BY FORBES Las Vegas The Tower Suites at Wynn Las Vegas and Encore Las Vegas have received the Forbes Five-Star designation for thirteen and ten consecutive years, respectively Macau Wynn Macau continues to be the only resort

  14. Slide 14: The Industry's Best Growth Pipeline

    The Industry’s Best Growth Pipeline 13

  15. Slide 15: We Have the Strongest Growth Pipeline in the Industry

    WE HAVE THE STRONGEST GROWTH PIPELINE IN THE INDUSTRY  Ramp and grow Adjusted Property EBITDA at Encore Boston Harbor  Targeted, high-return investments in our Las Vegas assets − Wynn Las Vegas convention expansion opens in early 2020, following the re-opening of the golf course − Enhanced F&B pro

  16. Slide 16: Encore Boston Harbor Overview

    ENCORE BOSTON HARBOR OVERVIEW: THE EAST COAST’S FIRST 5-STAR INTEGRATED RESORT  Luxury amenities include: − 3.1 million total square feet − 3,158 slot machines − 143 gaming tables − 88 poker tables − 671 luxury hotel rooms and suites − Full complement of non-gaming amenities, including broad array

  17. Slide 17: Boston Land Assembly Provides Long-Term Development Opportunities

    BOSTON LAND ASSEMBLY PROVIDES LONG-TERM DEVELOPMENT OPPORTUNITIES 16

  18. Slide 18: Wynn Las Vegas – Targeted Investments

    WYNN LAS VEGAS – TARGETED INVESTMENTS FURTHER SOLIDIFY OUR LEADING POSITION ON THE STRIP Enrique Olvera Restaurant Concept Delilah Supper Club Concept Thomas Keller Restaurant Additional Las Vegas Group Space Redesigned Golf Course Wynn Las Vegas Room Renovation 17

  19. Slide 19: Wynn Macau - Investing in the Future

    WYNN MACAU - INVESTING IN THE FUTURE  Renovating and updating the ~400 hotel rooms and suites at the Encore tower at Wynn Macau  Repositioning the West Casino − Creating a unique, premium guest experience − Adding two new specialty restaurants adjacent to the casino − Expanding our retail esplanad

  20. Slide 20: Wynn Palace – Crystal Pavilion Expansion

    WYNN PALACE – “FIRST OF ITS KIND” CRYSTAL PAVILION EXPANSION  Continuing to support Macau’s transition into a world center for tourism and leisure  Crystal Pavilion is slated to be a “must-see” tourist destination in Macau − Features an innovative architectural design with an all glass structure −

  21. Slide 21: Exciting Potential Opportunity in Japan

    EXCITING POTENTIAL OPPORTUNITY IN JAPAN  Recent legalization of integrated resorts in Japan represents an exciting opportunity for Wynn Resorts  The market has a number of very attractive attributes − “Las Vegas-like” model focused on non-gaming and gaming customers − Strong local demographics − G

  22. Slide 22: Wynn Japan: 5-Star Urban Resort

    WYNN JAPAN: 5-STAR URBAN RESORT 21

  23. Slide 23: Contributing to the Development of the Greater Bay Area

    Contributing to the Development of the Greater Bay Area

  24. Slide 24: Macau – Long Runway for Continued Growth

    MACAU – LONG RUNWAY FOR CONTINUED GROWTH Gross Gaming Revenue (DICJ) Market-Wide Property EBITDA GGR As a % of GDP ($M) ($M) $37,811 $10,000 0.4% $40,000 $9,184 0.36% $34,847 $8,389 0.3% 0.28% $30,000 $7,500 $17,767 $15,080 +8 bps = $20,000 $5,000 0.2% ~$10.5B GGR Opportunity $10,000 $19,767 $20,044

  25. Slide 25: A Brief History of Our Macau Operations

    A BRIEF HISTORY OF OUR MACAU OPERATIONS June 2002: September 2006: April 2010: August 2016: 2019: Legacy of Wynn awarded 20 Wynn Macau opens Encore Macau Wynn Palace opens innovation and year Macau opens excellence continues concession  Studied the market  Macau’s first true IR  Full integrated r

  26. Slide 26: Wynn Macau – Macau's First True Integrated Resort

    WYNN MACAU – MACAU’S FIRST TRUE INTEGRATED RESORT Macau’s first true integrated resort: pioneered and set the benchmark for luxury services & facilities Most Forbes 5-Star Awards: only resort with eight Five-Star awards in the world 3 million SF of total GFA 1,008 luxurious hotel rooms and suites 59

  27. Slide 27: Wynn Macau - Repositioning the West Casino

    WYNN MACAU - REPOSITIONING THE WEST CASINO 26

  28. Slide 28: Wynn Palace – The New Benchmark for Hospitality

    WYNN PALACE – THE NEW BENCHMARK FOR HOSPITALITY Extending the “Wynn Premium”: Raised the benchmark for luxury in Cotai. Platforming on the immense success of Wynn Macau and Encore Broadening Wynn’s exposure across all segments: Gaining share across key gaming and non-gaming segments 6 million SF of

  29. Slide 29: Mass and Non-Gaming Drive Our Macau EBITDA

    MASS AND NON-GAMING ARE INCREASINGLY THE PRIMARY DRIVERS OF OUR MACAU EBITDA Adjusted Property EBITDA Mix – 2017 Adjusted Property EBITDA Mix – 2018 36% 29% 64% 71%  Mass GGR per room increased 21% between 2016 and 2018  Adjusted Property EBITDA per room increased 20% between 2016 and 2018 28 Note

  30. Slide 30: Driving Mass Share Through Events and Precision Marketing

    DRIVING MASS SHARE THROUGH UNIQUE EVENTS AND PRECISION MARKETING Macau Operations Mass Table Market Share (DICJ)  Well equipped to succeed in all market environments 16% 14.9%  Our business is primarily driven by Mass and non-gaming 13.5% 12% 9.7% − Enhanced marketing capabilities through investin

  31. Slide 31: Greater Bay Area – Increasing Connectivity

    GREATER BAY AREA – INCREASING CONNECTIVITY BETWEEN MACAU, MAINLAND CHINA AND HONG KONG Source: Financial Times 30

  32. Slide 32: Greater Bay Area Initiative – Key Long-Term Growth Driver

    GREATER BAY AREA INITIATIVE - A KEY LONG-TERM DRIVER OF GROWTH FOR MACAU Population Comparison (M) GDP Comparison (US$B) 150 $2,500 $2,105 121 120 $2,000 $1,735 $1,545 $1,562 90 $1,500 70 60 $1,000 $863 36 30 20 $500 9 - $- San Fran New York Tokyo Greater Yangtze San Fran Greater Tokyo New York Yang

  33. Slide 33: The GBA Effect – Chimelong Resort

    THE GBA EFFECT – CHIMELONG RESORT 32

  34. Slide 34: Wynn Palace – Room to Grow

    WYNN PALACE – ROOM TO GROW Phase 1 7.4 Acres :  Crystal Pavilion  Luxury Hotel Tower (approx. 650 keys) Phase 2 4.1 Acres :  Luxury Hotel Tower (approx. 650 keys) 33

  35. Slide 35: Introducing the Crystal Pavilion

    INTRODUCING THE CRYSTAL PAVILION  The 34

  36. Slide 36: The Crystal Pavilion – A Macau Icon

    THE CRYSTAL PAVILION – A MACAU ICON  A glittering glass and steel structure, a feat of innovative design and engineering inspired by the shape and beauty of a water lily  Conceptualized and developed by famed New York architects Robert A.M Stern, in collaboration with Wynn Design & Development  A

  37. Slide 37: Immersive Theatre with Super-Live Technology

    IMMERSIVE THEATRE WITH SUPER-LIVE TECHNOLOGY 36

  38. Slide 38: Partnership with a World-Class Art Museum

    PARTNERSHIP WITH A WORLD-CLASS ART MUSEUM 37

  39. Slide 39: Art Museum - Overlooking Gardens

    ART MUSEUM - OVERLOOKING GARDENS 38

  40. Slide 40: The "Gong Spire"

    THE “GONG SPIRE” 39

  41. Slide 41: Asian Gourmet Pavilion

    ASIAN GOURMET PAVILION Span — b= ul al j= =| I | 7 | Hl

  42. Slide 42: Edoardo Tresoldi Sculpture

    EDOARDO TRESOLDI SCULPTURE 41

  43. Slide 43: Interactive Installations

    INTERACTIVE INSTALLATIONS 42

  44. Slide 44: Art Sculpture Gardens

    ART SCULPTURE GARDENS 43

  45. Slide 45: Two Phased Luxury Hotel Towers

    TWO PHASED LUXURY HOTEL TOWERS 44

  46. Slide 46: Wynn – A "Model Citizen" of the GBA

    WYNN - A “MODEL CITIZEN” OF THE GBA Investing in Macau Investing in our Employees Investing in our Community  Supporting Macau’s goal to diversify the  Educating and mentoring Macau’s next  Robust CSR program in Macau and economy within the Greater Bay Area generation of Hospitality leaders & bro

  47. Slide 47: Case Study: Culinary Scholarship Program

    CASE STUDY : CULINARY SCHOLARSHIP PROGRAM  Establishing the “Culinary Scholarship Program” with an expected launch in 2020 − Led by Chef Andre Chiang (Sichuan Moon) and Chef Tam Kwok Fung (Wing Lei Palace) − Personalized two-year scholarship program under the umbrella of our “F&B Academy” − Highly

  48. Slide 48: Case Study: Collaboration with a Renowned Art Museum

    CASE STUDY: COLLABORATION WITH A RENOWNED ART MUSEUM  As part of Wynn’s iconic Crystal Pavilion entertainment development, and in conjunction with a world- renowned art museum, ten young talents from across the People’s Republic of China will be selected to undergo a unique, customized and certifie

  49. Slide 49: "Wynn Care": The Eight Directions

    “WYNN CARE”: THE EIGHT DIRECTIONS  Youth and Education  Small & Medium Enterprise Support  Charitable Initiatives  Volunteerism  Sustainability Initiatives  Responsible Gaming  Government Relations  Localization & Positive Social Impact 48

  50. Slide 50: National Partnerships to Expand CSR Reach

    NATIONAL PARTNERSHIPS TO EXPAND CSR REACH  Expanding our CSR initiatives in the GBA and the broader PRC, including in partnership with PRC-based NGOs − Wynn Cup cultural exchange tour visited Xi’an to inaugurate the Macau-Shaanxi Youth Drawing Exhibition − Arranged for award-winning students to joi

  51. Slide 51: Macau: Key Takeaways

    MACAU: KEY TAKEAWAYS  Having the best physical assets and the best hospitality workforce allows us to succeed in any market environment − The Mass and Non-Gaming segments are increasingly the primary drivers of our business − Macau’s powerful long-term secular growth story is fully secure  We are

  52. Slide 52: Doubling Down on Our Leading Las Vegas Positioning

    Doubling Down on Our Leading Las Vegas Positioning

  53. Slide 53: Wynn | Encore Las Vegas – The Premier Luxury Destination

    WYNN | ENCORE LAS VEGAS – THE PREMIER LUXURY DESTINATION 10+ million SF development: 194,000 SF Casino catering to premium customers Full complement of non-gaming amenities  4,748 hotel rooms  160,000 SF of premium retail  Over 500,000 SF of rentable meeting space1  33 food and beverage outlets

  54. Slide 54: Las Vegas – Leveraging Our Core Competencies

    LAS VEGAS – LEVERAGING OUR CORE COMPETENCIES Las Vegas Strip Gross Gaming Revenue Las Vegas Visitation (M) $7,000 $6,516 $6,532 45.0 42.0 42.2 $6,000 $5,000 $3,223 $3,335 36.0 $ millions $4,000 27.0 $3,000 $2,000 18.0 $3,292 $3,197 $1,000 9.0 $0 TTM 1Q18 TTM 1Q19 - Source: LVCVA, NGCB Tables Slots T

  55. Slide 55: More 2019 Forbes Five-Star Awards Than Any Independent Hotel Company

    MORE 2019 FORBES FIVE-STAR AWARDS THAN ANY INDEPENDENT HOTEL COMPANY IN THE WORLD The Tower Suites and Spas at Wynn Las Vegas and Encore Las Vegas have received the Forbes Five-Star designation for thirteen and ten consecutive years, respectively 54

  56. Slide 56: Wynn Las Vegas – Setting the Standard for Luxury Service

    WYNN LAS VEGAS – SETTING THE STANDARD FOR LUXURY PRODUCT AND SERVICE LEVELS IN THE HOSPITALITY INDUSTRY Wynn I Encore Net Promoter Score vs. Industry Benchmarks 75 71 65 65 63 61 55 50 45 35 25 Wynn I Encore Wynn I Encore Wynn I Encore Luxury Hospitality Overall Hospitality YTD May 2017 YTD May 2018

  57. Slide 57: Wynn Las Vegas – Convention Center Expansion

    WYNN LAS VEGAS – CONVENTION CENTER EXPANSION  ~430,000 gross sq. ft. of incremental state-of-the-art MICE facilities will nearly double our group footprint in Las Vegas  Project highlights − Expected opening in Q1 2020 − Once scaled, drive 4-6 pts of incremental occupancy at attractive ADRs − High

  58. Slide 58: Wynn Las Vegas – Enhanced F&B Program

    WYNN LAS VEGAS – ENHANCED F&B PROGRAM  Expanding the market’s best F&B program to drive operating leverage through our existing assets  Innovative non-gaming amenities drive visitation and casino revenue Supper Club Concept − Exclusive partnership with award-winning international chef Enrique Olve

  59. Slide 59: Wynn Las Vegas – Key Takeaways

    WYNN LAS VEGAS – KEY TAKEAWAYS  We have the best assets in the market − Best positioned for growth over the long-term − Group base allows us to profitably yield manage our rooms − Domestic casino play strong but near-term “choppiness” in Baccarat expected  We are focused on driving operating lever

  60. Slide 60: Introducing the East Coast's First 5-Star Integrated Resort

    Introducing the East Coast’s First 5-Star Integrated Resort

  61. Slide 61: Encore Boston Harbor – Before

    ENCORE BOSTON HARBOR – BEFORE 60

  62. Slide 62: Encore Boston Harbor – After

    ENCORE BOSTON HARBOR – AFTER 61

  63. Slide 63: Boston – Strong Regional Demographics

    BOSTON - STRONG REGIONAL DEMOGRAPHICS WITH 25 MILLION GAMING AGE RESIDENTS WITHIN 400 MILES ME Hollywood Casino VT 150 miles Augusta Montpelier Oxford Maine Casino NH 100 miles Atlantic NY Concord Ocean Legend Saratoga Casino 50 miles Rivers Casino Slot & table casino Slot casino Albany Cities MA En

  64. Slide 64: Market Assessment: Current Boston-Area Gaming Market

    MARKET ASSESSMENT: CURRENT BOSTON-AREA GAMING MARKET STRONG MARKET, POISED FOR GROWTH  Existing Boston-area regional gaming market currently generates approximately $2.6 billion of GGR annually  Current gaming market is dominated by Mohegan Sun and Foxwoods in Connecticut and Twin River in Rhode I

  65. Slide 65: Encore Boston Harbor Key KPIs

    ENCORE BOSTON HARBOR KEY KPIS SLOT MACHINE & TABLE GAMES WIN COMPARISON Slot Machine WPUPD Table Games WPUPD ($) ($) $500 $6,000 $5,648 $461 $400 $389 $4,500 $350 $340 $300 $3,331 $3,028 $3,000 $2,913 $200 $1,500 $100 $0 $0 Borgata Resorts World Mohegan National National Twin River Sands Borgata NY

  66. Slide 66: EBH Key KPIs - Boston-Area Hotel Market Comparison

    EBH KEY KPIS - BOSTON-AREA HOTEL MARKET COMPARISON Leisure Hotel Rates1 ($) $800 $775 $647 $631 $595 $600 $400 $200 $0 Four Seasons Mandarin Four Seasons Ritz Carlton (Back Bay) Oriental (Downtown Boston)  Strong luxury hotel market in Boston CBD  Subsequent to ramp and customer trial, we anticipa

  67. Slide 67: Encore Boston Harbor – EBITDA Ramp

    ENCORE BOSTON HARBOR – EBITDA RAMP  Precedent regional openings suggest ~36 month ramp to reach EBH Steady State Operating Revenue Target ($M) “steady state” Adjusted Property EBITDA $1,200 $1,100 $1,000 $900  Key assumptions required to reach target include: $800 − Successful operation of a “Las

  68. Slide 68: Looking Forward to 2021

    Looking Forward to 2021 67

  69. Slide 69: Operating Performance: Key Puts and Takes

    OPERATING PERFORMANCE: KEY PUTS AND TAKES Macau Las Vegas Boston  Potential Upside Drivers  Potential Upside Drivers  Potential Upside Drivers − VIP recovery − Baccarat business improves − Mid-week cash rooms − Premium Mass share gains − F&B enhancements drive share − Slot business upside with ga

  70. Slide 70: Strong, Visible Adjusted Property EBITDA Growth Targeted Through 2021

    STRONG, VISIBLE ADJUSTED PROPERTY EBITDA GROWTH TARGETED THROUGH 2021 Wynn Resorts Revenue Bridge Wynn Resorts EBITDA Bridge1 ($M) ($M) $9,000 $2,500 $211 $61 $277 $960 $104 $82 $7,500 $255 $2,000 $6,000 $1,500 $4,500 $7,890 $8,102 $2,296 $7,614 $2,152 $2,235 $6,654 $6,654 $1,000 $2,048 $3,000 $1,79

  71. Slide 71: 2021E Adjusted Property EBITDA Target Breakdown and Key Assumptions

    2021E ADJUSTED PROPERTY EBITDA TARGET BREAKDOWN AND KEY ASSUMPTIONS Wynn Resorts 2021E Adj. Property EBITDA Target1 Wynn Resorts 2021E Target: Key Assumptions ($M) Macau: $3,000  Market GGR grows at a 3.5% CAGR through 2021 − Infrastructure improvement (bridge, rail) $2,417  Market GGR growth driv

  72. Slide 72: Key Capex Investments

    KEY CAPEX INVESTMENTS ($M) $1,200 $1,200 $185 $900 $275 $125 $600 $525 $200 $300 $615 $75 $215 $250 $215 $- 2019E 2020E 2021E EBH Project Wynn Macau Projects LV Room Refresh LV Group Expansion & F&B Enhancements Maintenance 71 Note: The chart above excludes Crystal Pavilion capex

  73. Slide 73: Crystal Pavilion – Financial Overview

    CRYSTAL PAVILION – FINANCIAL OVERVIEW  Initial estimate of US$2.0 billion for Phase 1 South Parcel Pavilion and ~650 room hotel tower – Later phase (North Parcel hotel tower) cost TBD  Targeted Adjusted Property EBITDA ROIC of ~15-20%  7 to 10 million visitors expected annually  Phase 1 South Pa

  74. Slide 74: FCF Inflection Is Imminent

    FCF INFLECTION IS IMMINENT – POTENTIAL FOR $16 PER SHARE IN DISCRETIONARY FCF Wynn Resorts Discretionary FCF Target1 ($M) Discretionary FCF Growth Target1 ($M) $2,000 Adjusted Property EBITDA Target2 $ 2,417 $1,680 Less: Corporate Expense (120) $1,600 Less: Cash Paid for Interest (390) $1,200 Less:

  75. Slide 75: Our Capital Allocation Strategy

    Our Capital Allocation Strategy 74

  76. Slide 76: Driving Long-Term Shareholder Value Creation

    DRIVING LONG-TERM SHAREHOLDER VALUE CREATION Drive Strong Organic Invest in Increase Return Free Cash Flow Growth High ROIC Growth Projects of Capital to Shareholders  Leverage the industry’s best assets to  Putting capex in the ground is our highest  Growing our recurring dividend is the drive f

  77. Slide 77: Our Share Repurchase Philosophy

    OUR SHARE REPURCHASE PHILOSOPHY WYNN Share Price Since IPO $250 Global Macau VIP China Anti- Trade tensions Financial slowdown Corruption and late cycle Crisis Campaign macro fears $200 $150 $100 $50 $- Jul-03 Jul-04 Jul-05 Jul-06 Jul-07 Jul-08 Jul-09 Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16

  78. Slide 78: Q&A

    Q&A 77

  79. Slide 79: Wynn Resorts

    ta, RESORTS

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