Melco Crown profit soars; Okada files fresh paperwork against Wynn in Nevada

TAGs: Kazuo Okada, Macau, Melco Crown Entertainment, Wynn Resorts

melco-crown-profit-soarsMacau casino operator Melco Crown Entertainment Ltd. saw Q1 2012 profit rise to $122.1m, a 17-fold increase over the same period last year. The joint venture of Hong Kong’s Lawrence Ho and Australia’s James Packer, which operates the City of Dreams casino and the Mocha Clubs slots parlor chain in Macau, saw net revenues rise 27% to $1.03b. The company credited improvements in its mass market table games segment and improved group-wide rolling chip win rate, plus a reduction in non-operating expenses, including lower net interest costs. About the only blight on Melco Crown’s balance sheet was a $3.6m charge attributable to the amortization of land use rights at the stalled Studio City project on Macau’s Cotai strip.

On a post-earnings conference call, Ho said the company was optimistic it would soon get the nod from Macau authorities to proceed with the Studio City project, much like rival Wynn Resorts received last week. “Fingers crossed, hopefully, we get the construction permit sooner rather than later.” Ideally, Ho hopes to start construction by this summer. Earlier this week, Union Gaming Group analyst Grant Govertsen issued a note to clients describing “what appears to be two blocks of construction offices” going up on the Studio City land. Govertsen noted that permission to erect such offices would require government approval, adding weight to Ho’s predictions that the nod to start moving earth was imminent.

The Macau-related activities of Wynn Resorts continue to vex Wynn’s former number one shareholder Kazuo Okada. The Universal Entertainment chairman, whose Wynn shares were forcibly redeemed in February after he was accused by Wynn of improprieties with Asian gaming regulators, has filed a new request for documents related to Wynn’s dealings with Macau officials during Wynn’s quest for a casino license between 2000 and 2002. Okada’s initial court victory in March rang hollow when a Nevada judge ordered Wynn to turn over a measly two pages of documents, but the same judge suggested Okada might have better luck if he refined the scope of his “overbroad” document request.

Done and done. Vegas Inc. reports that Okada filed papers in Clark County District Court in Las Vegas last week to force Wynn to cough up documents involving (a) alleged entertainment expenses of Macau officials by Wynn predecessor company Valvino Lamore LLC, (b) precisely how Valvino used a $120m investment by Okada’s Aruze USA firm, and (c) any paperwork “reflecting or concerning expenditures of any amount for or on behalf of government or gaming officials in any jurisdiction.” Okada used the filing to continue his personal war of words with Steve Wynn, stating that the CEO “has caused Wynn Resorts to waste further funds and put the company at further risk, embroiling it in a morass of ever-growing litigation and governmental inquiry.” And the beat goes on…


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