Melco Resorts and Entertainment (MRE) lost over $331mn in the third quarter of 2020. The MRE reported positive earnings in Manila and Cyprus.
The figures released on Thursday revealed that MRE generated revenue of $213mn in the three months ending on September 30.
This is an 85% decline for the same period last year. The company has reported negative earnings of $76.7mn versus $418.2mn last year. The net loss of $331.6mn versus $83.2mn profit in Q3 2019.
The net loss was slightly better than $368mn in Q2 2020. However, MRE boss Lawrence Ho, said that he is happy with the moderate recovery. The Cyprus and Manila casino operations make things better. MRE is also hoping Macau business operations would give them some relief.
MRE’s flagship Macau property City of Dreams reported down to 88.3% to $91.4mn with negative earnings of $49.2mn. VIP gambling turnover fell 89%, mass-market table drop slid 93.6%, slots handle slumped 91%. The City of Dreams reported a higher provision for credit losses of around $32mn.
Studio City isn’t better as well. The revenues dropped by 91%, VIP Turnover slummed 94.5%, mass table drop 94.3% and slot handle dropped by 96%. The reported negative earnings are $21.7mn. The negative earning also reported at Altira Macau as $16.8mn and at the Mocha Clubs slot business hall as $500k.
Manila Casino has been operating at 30% capacity since it resumed. The City of Dreams Manila’s revenue was down to two-third to $43.4mn. The VIP win rate was improved and was at 2.68%. This is a dramatic improvement from Q2 which was at 0.89%. The VIP turnover was reduced to 77%. However, there has been no official comment from MRE after it was reported that the government of the Philippines has allowed online gambling for the land-based casinos.
MRE has reopened temporary and satellite casinos temporarily in Cyprus though. It generated revenue of $20.5mn and earnings of $6.3mn. It is obviously slummed by one-quarter on a year-on-year basis. VIP turnover fell by 99.5%, however, the VIP win was a remarkable 36%.
The company has set the breakeven earnings of mid-to-high 20% range of pre-COVID19. This is a vast improvement from Q2, where the target was 30%-35%.
CFO Geoff Davis said they are currently working with 35% of its volume and mostly from the premium mass. They have roughly $10mn bad debt.
COO David Sisk said that the crackdown on cross-border gambling in China has made things tough for them. The junket operators are affected and these operators contribute almost 10% of the profitability.