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Melco Resorts and Entertainment has reaffirmed its contribution to its global expansion initiative, amid the group’s continuing financial challenges related to the current coronavirus pandemic.
Travel constraints in Macau, Hong Kong, and some Chinese provinces, as well as closures in the Philippines and Europe, where its Cypriot operations were shuttered for parts of the year, are primarily to blame for the year’s poor results, according to the casino resort operator.
Despite this, Melco has confirmed that development on the Studio City extension is continuing and that improvements to City of Dreams are underway, with the development of Cyprus’ City of Dreams Mediterranean taking additional time.
As a result, the government of Cyprus last month extended the multi-million pound development’s opening date requirement until September 30, 2022.
Lawrence Ho, Melco’s chairman and CEO, also gave an update on the company’s Japanese ambitions: “Turning to Japan, I want to highlight our continued commitment to bring to the country a world-leading IR.
“We believe our focus on the Asian premium segment, a portfolio of high-quality assets, devotion to craftsmanship, dedication to world-class entertainment offerings, market-leading social safeguard systems, established track record of successful partnerships, culture of exceptional guest service, and a continuing commitment to employee development puts Melco in a strong position to help Japan realise the vision of developing an exceptional IR with a uniquely Japanese touch.
“Due to COVID, the process in Japan has been delayed and remains complex but has renewed momentum as jurisdictions are again initiating RFP processes. We will continue to be patient as we evaluate the landscape to ensure that Melco pursues the right opportunity that takes advantage of Melco’s core strengths to drive strong value creation.”
Softer results in gaming divisions and non-gaming activities
Operating sales dropped 64 percent to $528,002 in the fourth quarter of 2020 (2019: $1.45 billion), leading to softer results in both gaming divisions and non-gaming activities as a result of the COVID-19 pandemic, which culminated in a substantial decrease in inbound tourism during the year.
The net loss for the quarter was $144.8 million, compared to $173.4 million a year previously, with adjusted EBITDA of $53.4 million (2019: $409.8 million).
For the full year, company operating sales plummeted 69.8% to $1.73 billion (2019: 5.74 billion) due to the same causes listed above, net loss of $1.26 billion relative to profits of 373.2 million in 2019, and adjusted EBITDA finished the year with a loss of $104.2 million (2019: $1.68 billion).
“COVID-19 and the subsequent travel restrictions continue to have a significant negative impact on our operating and financial performance,” Ho concluded.
“Despite these challenges, our integrated resorts experienced a moderate recovery in business levels during the fourth quarter.
“While we are encouraged by the recent positive developments, ensuring the safety and well-being of our colleagues, customers and communities in which we operate remains our highest priority.
“Melco also fully supports the Macau SAR government’s scheme for tourists from Mainland China with the aim to expand the number of visitors, boost the economy, and protect local jobs.
“In support of the scheme, Melco strives to continue prioritising epidemic prevention measures by working hand-in-hand with local small and medium enterprise partners, while contributing collaboratively to the city’s sustainable development and economic recovery.”