Melco Resorts & Entertainment(MLCO) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company recorded $1.4 billion in group property EBITDA for the full year of 2025, growing by 17% compared to 2024 [3] - Group-wide adjusted property EBITDA for Q4 2025 grew 12% year-over-year to approximately $331 million [6] - Macau property EBITDA grew 24% year-over-year in Q4 and 25% for the full year compared to 2024 [3] Business Line Data and Key Metrics Changes - In Macau, the company focused on enhancing customer experience, leading to significant EBITDA growth [3] - City of Dreams Mediterranean and satellite casinos in Cyprus achieved 78% year-over-year growth in property EBITDA to $21 million for Q4 2025 [5] - The Philippines faced competitive pressures, but positive developments such as visa-free travel for Chinese nationals were noted [4] Market Data and Key Metrics Changes - Macau market GGR was up by 24% year-over-year, with an increase in market share observed in early 2026 [3] - The company expects Macau daily operating expenses to rise to approximately $3.2 million in Q1 2026 due to increased marketing activities [8] Company Strategy and Development Direction - The company plans to implement new initiatives in 2026, including the opening of the renovated Countdown Hotel, expected to set a new benchmark in Macau [4] - A revamp of the retail area at COD and upgrades to food and beverage offerings are also in the pipeline [4] Management's Comments on Operating Environment and Future Outlook - Management noted that competition in Macau remains intense but is expected to stabilize [21][26] - The company is confident in its ability to manage operating costs and maintain EBITDA margins throughout 2026 [27] Other Important Information - The company had available liquidity of approximately $2.4 billion and consolidated cash on hand of approximately $1.2 billion as of the end of 2025 [8] - Total CapEx for 2026 is projected at $450 million, with significant investments in the Countdown Hotel and other properties [33] Q&A Session Summary Question: Impact of House of Dancing Water on visitation and revenue - Management noted a meaningful uptick in property visitation since reopening the show, driving additional spending across non-gaming segments [15][16] Question: Competitive intensity in Macau and EBITDA margin expectations - Management acknowledged intense competition but expressed confidence in maintaining margins due to disciplined cost management [21][27] Question: Clarification on operating expenses related to non-recurring items - Management quantified additional bad debt at approximately $5 million and anniversary-related expenses at about $6 million for the quarter [31] Question: CapEx breakdown for major projects - Total CapEx for 2026 is $450 million, with $375 million allocated to Macau and significant funds for the Countdown Hotel [33]