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Wynn Macau shares slide on low table allocation for new casino
July 29, 2016 / 8:01 AM / a year ago

Wynn Macau shares slide on low table allocation for new casino

HONG KONG (Reuters) - Casino operator Wynn Macau Ltd (1128.HK), a unit of U.S. tycoon Steve Wynn’s Wynn Resorts (WYNN.O), slid as much as 7 percent on Friday after it said it received only half of the new gaming table permits expected for its new $4.2 billion Macau casino.

A general view of Wynn Macau resort in Macau, China November 21, 2015. REUTERS/Bobby Yip

Despite reporting earlier in the day that second-quarter revenue beat estimates, Wynn Macau saw its shares drop to their lowest level since end-August 2015 after it said it received official permits for 100 gaming tables for its new resort in the territory, rather than around 200 as analysts had expected.

At 0751 GMT, shares were down 6.5 percent while the benchmark index was 1.5 percent lower.

    The Aug. 22 opening of the new Wynn Macau resort comes in the teeth of a prolonged slowdown in the world’s largest gambling hub. Casino revenue has fallen for 25 months in a row, and is expected to further weaken amid China’s crackdown on corruption.

    Praveen Choudhary, an analyst at Morgan Stanley said in a note on Friday that the low table allocation could impact full-year estimates for Wynn Macau. Investors “will be negatively surprised by only 100 new tables allocated to a $4.2bn project”, Choudhary said.

    Earlier, Wynn Macau posted net revenue of $639 million for the second quarter of the year, up 3.6 percent from the same period a year earlier and between 6-10 percent higher than analysts’ expectations.

    Reporting by Farah Master; Editing by Kenneth Maxwell

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