What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-08-09 compared with 2023-05-09 · 276 added, 88 removed, 349 unchanged (51% of the section changed)

88 unchanged sentences

Results of Operations

Summary of first quarter 2023 results

Summary of second quarter 2023 results

The following table summarizes our financial results for the periods presented (dollars in thousands, except per share data):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change 2023 2022 Increase/ (Decrease) Percent Change

Operating revenues $ 1,595,822 $ 908,832 $ 686,990 75.6 $ 3,019,501 $ 1,862,166 $ 1,157,335 62.1

Net income (loss) attributable to Wynn Resorts, Limited 105,184 (130,051) 235,235 NM 117,516 (313,375) 430,891 NM

Diluted net income (loss) per share 0.84 (1.14) 1.98 NM 0.84 (2.73) 3.57 NM

NM - Not meaningful.

The increase in operating revenues for the three months ended June 30, 2023 was primarily driven by increases of $409.7 million and $243.0 million from Wynn Palace and Wynn Macau, respectively, resulting from an increase in gaming volumes, hotel occupancy, and covers at restaurants.

The results of our Macau Operations for the three months ended June 30, 2022 were negatively impacted by certain travel-related restrictions and conditions, including COVID-19 testing, certain entry restrictions, and other mitigation procedures, related to the COVID-19 pandemic.

Over the course of December 2022 and January 2023, Macau authorities relaxed or eliminated COVID-19 related protective measures.

As of the date of this report, there are no remaining entry restrictions or mandatory quarantine requirements in place for travelers to Macau, which resulted in increased business volumes at our Macau Operations for the three months ended June 30, 2023.

The increase in net income attributable to Wynn Resorts, Limited for the three months ended June 30, 2023 was primarily related to increased operating revenues at our Macau Operations, partially offset by increased operating expenses associated with higher business volumes at our Macau Operations.

Financial results for the three months ended June 30, 2023 compared to the three months ended June 30, 2022.

Operating revenues

The following table presents our operating revenues (dollars in thousands):

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Operating revenues

Net income (loss) attributable to Wynn Resorts, Limited 12,332 (183,324) 195,656 NM

Diluted net loss per share (0.02) (1.59) 1.57 NM

Macau Operations:

Wynn Palace $ 468,350 $ 58,651 $ 409,699 698.5

Wynn Macau 301,593 58,583 243,010 414.8

Total Macau Operations 769,943 117,234 652,709 556.8

Las Vegas Operations 578,072 561,069 17,003 3.0

Encore Boston Harbor 221,932 210,154 11,778 5.6

Wynn Interactive 25,875 20,375 5,500 27.0

$ 1,595,822 $ 908,832 $ 686,990 75.6

The following table presents our casino and non-casino operating revenues (dollars in thousands):

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Operating revenues

Casino revenues $ 912,999 $ 359,585 $ 553,414 153.9

Non-casino revenues:

Rooms 276,505 201,298 75,207 37.4

Food and beverage 257,036 229,816 27,220 11.8

Entertainment, retail and other 149,282 118,133 31,149 26.4

Total non-casino revenues 682,823 549,247 133,576 24.3

$ 1,595,822 $ 908,832 $ 686,990 75.6

Casino revenues for the three months ended June 30, 2023 were 57.2% of operating revenues, compared to 39.6% for the same period of 2022.

Non-casino revenues for the three months ended June 30, 2023 were 42.8% of operating revenues, compared to 60.4% for the same period of 2022.

Casino revenues

Casino revenues increased primarily due to higher gaming volumes at our Macau Operations following the discontinuation of pandemic-related travel restrictions in Macau in late 2022 and early 2023.

The table below sets forth our casino revenues and associated key operating measures (dollars in thousands, except for win per unit per day):

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Macau Operations:

Total casino revenues $ 365,277 $ 27,194 $ 338,083 1,243.2

Average number of table games 57 46 11 23.9

VIP turnover $ 3,042,338 $ 344,462 $ 2,697,876 783.2

VIP table games win (loss) $ 129,030 $ (6,671) $ 135,701 NM

VIP win (loss) as a % of turnover 4.24 % (1.94) % 6.18

Table games win (loss) per unit per day $ 24,728 $ (1,600) $ 26,328 NM

Average number of table games 240 231 9 3.9

Table drop $ 1,507,148 $ 210,549 $ 1,296,599 615.8

Table games win $ 305,817 $ 41,581 $ 264,236 635.5

Table games win % 20.3 % 19.7 % 0.6

Table games win per unit per day $ 13,980 $ 1,977 $ 12,003 607.1

Average number of slot machines 586 634 (48) (7.6)

Slot machine handle $ 579,626 $ 130,404 $ 449,222 344.5

Slot machine win $ 27,583 $ 4,922 $ 22,661 460.4

Slot machine win per unit per day $ 517 $ 85 $ 432 508.2

Total casino revenues $ 242,950 $ 39,959 $ 202,991 508.0

Average number of table games 48 40 8 20.0

VIP turnover $ 1,390,272 $ 301,645 $ 1,088,627 360.9

VIP table games win $ 57,828 $ 14,446 $ 43,382 300.3

VIP win as a % of turnover 4.16 % 4.79 % (0.63)

Table games win per unit per day $ 13,257 $ 4,006 $ 9,251 230.9

Average number of table games 209 246 (37) (15.0)

Table drop $ 1,223,311 $ 216,154 $ 1,007,157 465.9

Table games win $ 216,405 $ 30,582 $ 185,823 607.6

Table games win % 17.7 % 14.1 % 3.6

Table games win per unit per day $ 11,388 $ 1,365 $ 10,023 734.3

Average number of slot machines 533 665 (132) (19.8)

Slot machine handle $ 519,807 $ 199,312 $ 320,495 160.8

Slot machine win $ 15,452 $ 6,329 $ 9,123 144.1

Slot machine win per unit per day $ 319 $ 105 $ 214 203.8

Poker rake $ 5,376 $ 60 $ 5,316 NM

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Las Vegas Operations:

Total casino revenues $ 137,946 $ 135,345 $ 2,601 1.9

Average number of table games 235 237 (2) (0.8)

Table drop $ 559,701 $ 564,982 $ (5,281) (0.9)

Table games win $ 128,012 $ 138,879 $ (10,867) (7.8)

Table games win % 22.9 % 24.6 % (1.7)

Table games win per unit per day $ 5,997 $ 6,440 $ (443) (6.9)

Average number of slot machines 1,651 1,712 (61) (3.6)

Slot machine handle $ 1,522,525 $ 1,326,178 $ 196,347 14.8

Slot machine win $ 103,357 $ 89,844 $ 13,513 15.0

Slot machine win per unit per day $ 688 $ 577 $ 111 19.2

Poker rake $ 6,460 $ 5,021 $ 1,439 28.7

Encore Boston Harbor:

Total casino revenues $ 166,826 $ 157,087 $ 9,739 6.2

Average number of table games 190 184 6 3.3

Table drop $ 354,365 $ 366,222 $ (11,857) (3.2)

Table games win $ 79,072 $ 80,263 $ (1,191) (1.5)

Table games win % 22.3 % 21.9 % 0.4

Table games win per unit per day $ 4,573 $ 4,794 $ (221) (4.6)

Average number of slot machines 2,561 2,781 (220) (7.9)

Slot machine handle $ 1,300,237 $ 1,232,427 $ 67,810 5.5

Slot machine win $ 106,726 $ 99,424 $ 7,302 7.3

Slot machine win per unit per day $ 458 $ 393 $ 65 16.5

Poker rake $ 5,211 $ 1,241 $ 3,970 319.9

NM - Not meaningful.

The increase in operating revenues for the three months ended March 31, 2023 was primarily driven by increases of $206.0 million, $145.6 million, $95.6 million, and $25.5 million from Wynn Palace, our Las Vegas Operations, Wynn Macau, and Encore Boston Harbor, respectively, resulting from an increase in gaming volumes, hotel occupancy, and covers at restaurants.

The results of our Macau Operations for the three months ended March 31, 2022 were negatively impacted by certain travel-related restrictions and conditions, including COVID-19 testing and other mitigation procedures, related to the COVID-19 pandemic.

Over the course of December 2022 and January 2023, Macau authorities relaxed or eliminated most COVID-19 related protective measures.

Since then, and as of the date of this report, there are no remaining entry restrictions or mandatory quarantine requirements in place for travelers to Macau.

The increase in net income attributable to Wynn Resorts, Limited for the three months ended March 31, 2023 was primarily related to increased operating revenues at our Macau Operations, our Las Vegas Operations, and Encore Boston Harbor, partially offset by increased operating expenses associated with higher business volumes.

Financial results for the three months ended March 31, 2023 compared to the three months ended March 31, 2022.

Non-casino revenues

The table below sets forth our room revenues and associated key operating measures:

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Macau Operations:

Wynn Palace :

Total room revenues (dollars in thousands) $ 50,092 $ 7,008 $ 43,084 614.8

Occupancy 96.5 % 28.5 % 68.0

ADR $ 318 $ 145 $ 173 119.3

REVPAR $ 307 $ 41 $ 266 648.8

Total room revenues (dollars in thousands) $ 26,130 $ 4,762 $ 21,368 448.7

Occupancy 96.8 % 31.3 % 65.5

ADR $ 269 $ 150 $ 119 79.3

REVPAR $ 260 $ 47 $ 213 453.2

Las Vegas Operations:

Total room revenues (dollars in thousands) $ 177,765 $ 167,115 $ 10,650 6.4

Occupancy 90.6 % 90.5 % 0.1

ADR $ 462 $ 460 $ 2 0.4

REVPAR $ 418 $ 417 $ 1 0.2

Encore Boston Harbor:

Total room revenues (dollars in thousands) $ 22,518 $ 22,413 $ 105 0.5

Occupancy 92.7 % 94.1 % (1.4)

ADR $ 400 $ 391 $ 9 2.3

REVPAR $ 371 $ 368 $ 3 0.8

Room revenues increased $75.2 million, primarily due to higher occupancy and ADR at our Macau Operations.

Food and beverage revenues increased $27.2 million as a result of increased restaurant covers at our Macau Operations.

Entertainment, retail and other revenues increased $31.1 million, due to higher business volumes across our properties, including an increase in revenues of $12.5 million from our leased retail outlets at our Macau Operations.

Operating expenses

The table below presents operating expenses (dollars in thousands):

Three Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

Operating expenses:

Casino $ 543,643 $ 244,064 $ 299,579 122.7

Rooms 73,783 65,070 8,713 13.4

Food and beverage 203,922 185,471 18,451 9.9

Entertainment, retail and other 85,999 74,985 11,014 14.7

General and administrative 257,321 200,378 56,943 28.4

Provision for credit losses (6,640) (3,487) (3,153) 90.4

Pre-opening 1,477 4,502 (3,025) (67.2)

Depreciation and amortization 169,962 162,968 6,994 4.3

Property charges and other 16,019 26,909 (10,890) (40.5)

Total operating expenses $ 1,345,486 $ 960,860 $ 384,626 40.0

Total operating expenses increased $384.6 million compared to the three months ended June 30, 2022, primarily due to increased casino, room, food and beverage, entertainment, retail and other, and general and administrative expenses, partially offset by decreased property charges and other expenses.

Casino expenses increased $189.5 million and $104.5 million at Wynn Palace and Wynn Macau, respectively.

These increases resulted from higher operating costs, including $179.1 million and $102.0 million in incremental gaming tax expense at Wynn Palace and Wynn Macau, respectively, driven by the increase in casino revenues.

Room expenses increased $3.8 million and $2.8 million at our Las Vegas Operations and Wynn Palace, respectively.

These increases resulted from higher operating costs related to an increase in room revenues at our Las Vegas Operations and Wynn Palace.

Food and beverage expenses increased $7.3 million and $4.1 million at Wynn Palace and Wynn Macau, respectively.

These increases resulted from higher operating costs related to an increase in food and beverage revenues at Wynn Palace and Wynn Macau.

Entertainment, retail and other expenses increased $4.7 million, $2.5 million, and $1.9 million at our Las Vegas operations, Wynn Macau, and Wynn Palace, respectively.

These increases resulted from higher operating costs related to increased revenues at our Las Vegas Operations and our Macau Operations.

None of the increased operating costs was individually significant.

General and administrative expenses increased primarily due to triple-net operating lease expense of $35.6 million at Encore Boston Harbor following the sale-leaseback transaction in December 2022.

In addition, corporate and other general and administrative expenses increased $12.2 million, primarily due to increased development costs.

For the three months ended June 30, 2023, pre-opening expenses totaled $1.5 million, which primarily related to new outlets and amenities across our properties.

For the three months ended June 30, 2022, pre-opening expenses totaled $4.5 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas.

Property charges and other expenses for the quarter ended June 30, 2023 consisted primarily of asset abandonments of $6.6 million and $1.1 million at our Las Vegas Operations and Wynn Palace, respectively, as well as contract termination and other expenses of $6.5 million at Wynn Macau.

Our property charges and other expenses for the quarter ended June 30, 2022 consisted primarily of impairment of goodwill and other finite-lived intangible assets of $7.5 million and $10.3 million, respectively, and $7.6 million of other restructuring costs related to management's decision to cease the operations of BetBull, Limited ("BetBull"), a subsidiary of Wynn Interactive.

Other non-operating income and expenses

Interest expense, net of capitalized interest, increased $35.4 million primarily due to an increase in the weighted average total debt balance and an increase in the weighted average interest rate to 6.08% for the three months ended June 30, 2023, from 5.14% for the three months ended June 30, 2022.

We recorded interest income of $44.1 million for the three months ended June 30, 2023, primarily related to interest earned on cash and cash equivalents held at financial institutions.

We incurred a foreign currency remeasurement gain of $7.0 million and a loss of $10.1 million for the three months ended June 30, 2023 and 2022, respectively.

The impact of the exchange rate fluctuation of the Macau pataca, in relation to the U.S.

dollar, on the remeasurements of U.S.

dollar denominated debt and other obligations from our Macau-related entities primarily drove the variability between periods.

We recorded a gain of $24.3 million and $1.6 million for the three months ended June 30, 2023 and 2022, respectively, from change in derivatives fair value.

The change in derivatives fair value for the three months ended June 30, 2023 included a gain of $21.6 million recorded in relation to the conversion feature of the WML Convertible Bonds.

We recorded a $3.4 million loss on debt financing transactions for the three months ended June 30, 2023, primarily related to the issuance of the 2031 WRF Senior Notes, and the repurchase of the tendered 2025 WRF Senior Notes.

We recorded an income tax expense of $4.3 million and $0.7 million for the three months ended June 30, 2023 and 2022, respectively.

Income tax expense in 2023 primarily relates to U.S.

operating profits.

Income tax expense in 2022 primarily related to the Macau dividend tax agreement that provides for an annual payment as complementary tax otherwise due by stockholders of WRM.

We intend to continue to maintain a valuation allowance on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.

However, given our current earnings and anticipated future earnings, we believe there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a portion of the valuation allowance on certain U.S.

deferred tax assets will no longer be needed.

Release of the valuation allowance would result in the recognition of our deferred tax assets and a decrease to income tax expense for the period the release is recorded.

However, the exact timing and amount of the valuation allowance release are uncertain.

Net income (loss) attributable to noncontrolling interests

Net income attributable to noncontrolling interests was $22.7 million and net loss attributable to noncontrolling interests was $83.4 million for the three months ended June 30, 2023 and 2022, respectively.

These amounts are primarily related to the noncontrolling interests' share of net income (loss) attributable to WML.

Financial results for the six months ended June 30, 2023 compared to the six months ended June 30, 2022.

Operating revenues

The following table presents our operating revenues (dollars in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

8 unchanged sentences

$ 3,019,501 $ 1,862,166 $ 1,157,335 62.1

The following table presents casino and non-casino operating revenues (dollars in thousands):

Three Months Ended March 31,

The following table presents our casino and non-casino operating revenues (dollars in thousands):

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

7 unchanged sentences

$ 3,019,501 $ 1,862,166 $ 1,157,335 62.1

Casino revenues for the three months ended March 31, 2023 were 53.9% of operating revenues, compared to 51.4% for the same period of 2022.

Non-casino revenues for the three months ended March 31, 2023 were 46.1% of operating revenues, compared to 48.6% for the same period of 2022.

Casino revenues for the six months ended June 30, 2023 were 55.6% of operating revenues, compared to 45.6% for the same period of 2022.

Non-casino revenues for the six months ended June 30, 2023 were 44.4% of operating revenues, compared to 54.4% for the same period of 2022.

Casino revenues

1 unchanged sentence

The table below sets forth our casino revenues and associated key operating measures (dollars in thousands, except for win per unit per day):

Three Months Ended March 31,

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

31 unchanged sentences

Poker rake $ 9,312 $ 60 $ 9,252 NM

Three Months Ended March 31,

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

26 unchanged sentences

The table below sets forth our room revenues and associated key operating measures:

Three Months Ended March 31,

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

19 unchanged sentences

Room revenues increased $177.4 million, primarily due to higher occupancy and ADR at our Macau Operations and our Las Vegas Operations.

Food and beverage revenues increased $58.6 million, primarily due to increased restaurant covers at our Las Vegas Operations.

Entertainment, retail and other revenues increased $32.5 million, primarily due to increased convention support services, revenues from our owned and leased retail outlets, and entertainment venue sales at our Las Vegas Operations.

Food and beverage revenues increased $85.8 million, primarily due to increased restaurant covers at our Las Vegas Operations and our Macau Operations.

Entertainment, retail and other revenues increased $63.6 million due to higher business volumes across our properties, including an increase in revenues of $20.6 million from entertainment venue and convention-related sales at our Las Vegas Operations and an increase in revenues of $19.3 million from our leased retail outlets at our Macau Operations.

Operating expenses

The table below presents operating expenses (dollars in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change

5 unchanged sentences

General and administrative 517,093 397,158 119,935 30.2

Provision for credit losses (544) 342 (886) NM

Provision for credit losses (7,184) (3,145) (4,039) 128.4

Pre-opening 5,955 6,949 (994) (14.3)

2 unchanged sentences

Total operating expenses $ 2,599,650 $ 2,009,059 $ 590,591 29.4

NM - Not meaningful.

Total operating expenses increased $206.0 million compared to the three months ended March 31, 2022, primarily due to increased operating costs associated with higher business volumes at each of our properties, partially offset by decreased depreciation and amortization and property charges and other expenses.

Casino expenses increased $91.9 million, $40.4 million, $7.6 million, and $9.5 million at Wynn Palace, Wynn Macau, our Las Vegas Operations, and Encore Boston Harbor, respectively.

These increases were primarily due to increased operating costs, including gaming tax expense, driven by the increase in casino revenues.

Room expenses increased $9.1 million and $2.1 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

These increases were primarily a result of higher operating costs related to the increase in occupancy.

Food and beverage expenses increased $24.9 million and $4.3 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

These increases were primarily a result of increased operating costs related to an increase in food and beverage revenues at our Las Vegas Operations and Encore Boston Harbor.

Entertainment, retail and other expenses increased $17.3 million at our Las Vegas operations, primarily due to higher operating costs associated with live and theatrical entertainment, partially offset by a decrease of $14.1 million at Wynn Interactive, primarily due to decreased marketing costs.

General and administrative expenses increased primarily due to increases of $35.3 million and $14.6 million at Encore Boston Harbor and our Las Vegas Operations, respectively.

These increases were attributable to triple-net operating lease expense at Encore Boston Harbor following the sale-leaseback transaction in December 2022, and increases in payroll and other general and administrative expenses at our Las Vegas Operations required to support higher business volumes during the three months ended March 31, 2023.

In addition, corporate and other general and administrative expenses increased $12.1 million, primarily due to increased development costs.

For the three months ended March 31, 2023, pre-opening expenses totaled $4.5 million, which primarily related to the launch of Wynn Interactive operations in Massachusetts.

For the three months ended March 31, 2022, pre-opening expenses totaled $2.4 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas.

Depreciation and amortization decreased $15.7 million, primarily due to the derecognition of certain real estate assets in connection with the Encore Boston Harbor sale-leaseback transaction in December 2022.

Property charges and other expenses for the three months ended March 31, 2023 consisted primarily of asset abandonments of $2.2 million at Wynn Palace.

Our property charges and other expenses for the quarter ended March 31, 2022 consisted primarily of impairment of goodwill of $30.3 million at Wynn Interactive, asset abandonments of $1.0 million and

$2.1 million at our Las Vegas Operations and Wynn Interactive, respectively, and contract termination expenses of $9.6 million at Wynn Interactive.

Total operating expenses increased $590.6 million compared to the six months ended June 30, 2022, primarily due to increased operating costs associated with higher business volumes at each of our properties, partially offset by decreased property charges and other expenses.

Casino expenses increased $281.4 million and $144.9 million at Wynn Palace and Wynn Macau, respectively.

These increases resulted from higher operating costs, including increases of $265.5 million and $141.6 million in incremental gaming tax expense at Wynn Palace and Wynn Macau, respectively, driven by the increase in casino revenues.

Room expenses increased $12.9 million and $4.6 million at our Las Vegas Operations and Wynn Palace, respectively.

These increases resulted from higher operating costs related to an increase in room revenues at our Las Vegas Operations and Wynn Palace.

Food and beverage expenses increased $31.0 million and $10.3 million at our Las Vegas Operations and Wynn Palace, respectively.

These increases resulted from higher operating costs related to an increase in food and beverage revenues at our Las Vegas Operations and Wynn Palace.

Entertainment, retail and other expenses increased $22.0 million at our Las Vegas operations as a result of higher operating costs associated with live and theatrical entertainment.

The increase was partially offset by a decrease of $13.0 million at Wynn Interactive, primarily due to decreased marketing costs.

General and administrative expenses increased primarily due to triple-net operating lease expense of $70.9 million at Encore Boston Harbor following the sale-leaseback transaction in December 2022, an increase of $15.7 million at our Las Vegas Operations attributable to payroll and other general and administrative expenses required to support higher business volumes, and increased corporate and other general and administrative expenses of $24.3 million, primarily due to development costs.

For the six months ended June 30, 2023, pre-opening expenses totaled $6.0 million, which primarily related to the launch of sports betting operations in Massachusetts.

For the six months ended June 30, 2022, pre-opening expenses totaled $6.9 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas.

Property charges and other expenses for the six months ended June 30, 2023 consisted primarily of asset abandonments of $6.7 million and $3.4 million at our Las Vegas Operations and Wynn Palace, respectively, as well as contract termination and other expenses of $6.5 million at Wynn Macau.

Our property charges and other expenses for the six months ended June 30, 2022 consisted primarily of impairment of goodwill and other finite-lived intangible assets of $37.8 million and $10.3 million, respectively, and $7.6 million of restructuring costs related to Wynn Interactive's BetBull operations, as well as other contract termination expenses of $10.6 million and asset abandonments of $2.1 million related to Wynn Interactive.

Other non-operating income and expenses

Interest expense, net of capitalized interest, increased $35.6 million primarily due to an increase in the weighted average total debt balance and an increase in the weighted average interest rate to 5.95% for the three months ended March 31, 2023, from 5.05% for the three months ended March 31, 2022.

We recorded interest income of $40.2 million for the three months ended March 31, 2023, primarily related to interest earned on cash and cash equivalents held at financial institutions.

We incurred a foreign currency remeasurement loss of $30.6 million and $15.1 million for the three months ended March 31, 2023 and 2022, respectively.

Interest expense, net of capitalized interest, increased $71.0 million primarily due to an increase in the weighted average total debt balance and an increase in the weighted average interest rate to 6.02% for the six months ended June 30, 2023, from 5.09% for the six months ended June 30, 2022.

We recorded interest income of $84.3 million for the six months ended June 30, 2023, primarily related to interest earned on cash and cash equivalents held at financial institutions.

We incurred a foreign currency remeasurement loss of $23.7 million and $25.2 million for the six months ended June 30, 2023 and 2022, respectively.

The impact of the exchange rate fluctuation of the Macau pataca, in relation to the U.S.

dollar, on the remeasurements of U.S.

dollar denominated debt and other obligations from our Macau-related entities drove the variability between periods.

We recorded a gain of $23.0 million and $7.4 million for the three months ended March 31, 2023 and 2022, respectively, from change in derivatives fair value.

The change in derivatives fair value for the three months ended March 31, 2023 included a gain of $24.9 million recorded in relation to the conversion feature of the WML Convertible Bonds.

We recorded a $12.2 million loss on debt financing transactions for the three months ended March 31, 2023, primarily related to the issuance of the 2031 WRF Senior Notes and the repurchase of the tendered 2025 WRF Senior Notes.

We recorded income tax expense of $1.0 million and $1.1 million for the three months ended March 31, 2023 and 2022, respectively.

dollar denominated debt and other obligations from our Macau-related entities primarily drove the variability between periods.

We recorded a gain of $47.4 million and $9.0 million for the six months ended June 30, 2023 and 2022, respectively, from change in derivatives fair value.

The change in derivatives fair value for the six months ended June 30, 2023 included a gain of $46.5 million recorded in relation to the conversion feature of the WML Convertible Bonds.

We recorded a $15.6 million loss on debt financing transactions for the six months ended June 30, 2023, primarily related to the issuance of the 2031 WRF Senior Notes and the repurchase of the tendered 2025 WRF Senior Notes.

We recorded income tax expense of $5.3 million and $1.9 million for the six months ended June 30, 2023 and 2022, respectively.

Income tax expense in 2023 primarily relates to U.S.

1 unchanged sentence

Income tax expense in 2022 primarily related to the Macau dividend tax agreement that provides for an annual payment as complementary tax otherwise due by stockholders of WRM.

Net loss attributable to noncontrolling interests

Net loss attributable to noncontrolling interests was $11.2 million and $71.3 million for the three months ended March 31, 2023 and 2022, respectively.

These amounts are primarily related to the noncontrolling interests' share of net loss from WML.

We intend to continue to maintain a valuation allowance on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.

deferred tax assets will no longer be needed.

Release of the valuation allowance would result in the recognition of our deferred tax assets and a decrease to income tax expense for the period the release is recorded.

However, the exact timing and amount of the valuation allowance release are uncertain.

Net income (loss) attributable to noncontrolling interests

Net income attributable to noncontrolling interests was $11.5 million and net loss attributable to noncontrolling interests was $154.7 million for the six months ended June 30, 2023 and 2022, respectively.

These amounts are primarily related to the noncontrolling interests' share of net income (loss) from WML.

Segment Information

11 unchanged sentences

The following table summarizes Adjusted Property EBITDAR (dollars in thousands) for Wynn Palace, Wynn Macau, Las Vegas Operations, Encore Boston Harbor, and Wynn Interactive as reviewed by management and summarized in Item 1—"Notes to Condensed Consolidated Financial Statements," Note 18, "Segment Information." That footnote also presents a reconciliation of Adjusted Property EBITDAR to net income (loss) attributable to Wynn Resorts, Limited.

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

Wynn Palace $ 111,058 $ (864) $ 111,922 NM

Wynn Macau 44,745 (4,682) 49,427 NM

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 Increase/ (Decrease) Percent Change 2023 2022 Increase/ (Decrease) Percent Change

Wynn Palace $ 156,607 $ (49,950) $ 206,557 NM $ 267,665 $ (50,814) $ 318,479 NM

Wynn Macau 89,590 (40,390) 129,980 NM 134,335 (45,072) 179,407 NM

Las Vegas Operations 224,121 226,706 (2,585) (1.1) 455,718 386,084 69,634 18.0

2 unchanged sentences

NM - Not meaningful.

Adjusted Property EBITDAR at Wynn Palace and Wynn Macau increased $111.9 million and $49.4 million for the three months ended March 31, 2023, respectively, primarily due to an increase in operating revenues, partially offset by an increase in operating expenses.

In December 2022 and early January 2023, the Macau government relaxed or eliminated most of COVID-19 related protective measures, which resulted in increased business volumes at our Macau Operations for the three months ended March 31, 2023.

Our Macau Operations for the three months ended March 31, 2022 were negatively impacted by certain travel-related restrictions and conditions related to the COVID-19 pandemic.

Adjusted Property EBITDAR at our Las Vegas Operations increased $72.2 million for the three months ended March 31, 2023, primarily due to an increase in revenues from casino, hotel, and food and beverage operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Encore Boston Harbor increased $8.2 million for the three months ended March 31, 2023, primarily due to an increase in revenues from casino operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Wynn Interactive increased $10.4 million for the three months ended March 31, 2023, primarily due to a decrease in marketing and promotional expenses, depreciation and amortization, and property charges and other expenses.

Adjusted Property EBITDAR at Wynn Palace and Wynn Macau increased $206.6 million and $130.0 million for the three months ended June 30, 2023, respectively, and $318.5 million and $179.4 million for the six months ended June 30, 2023, respectively, primarily due to an increase in operating revenues of $409.7 million and $243.0 million for the three months ended June 30, 2023, respectively, and $615.7 million and $338.6 million for the six months ended June 30, 2023, respectively, partially offset by an increase in operating expenses.

Our Macau Operations for the three and six months ended June 30, 2022 were negatively impacted by certain travel-related restrictions and conditions related to the COVID-19 pandemic.

Over the course of December 2022 and January 2023, the Macau authorities relaxed or eliminated COVID-19 related protective measures, which resulted in increased business volumes at our Macau Operations for the three and six months ended June 30, 2023.

Adjusted Property EBITDAR at our Las Vegas Operations decreased $2.6 million for the three months ended June 30, 2023, primarily due to an increase in operating expenses, partially off by an increase in revenues.

Adjusted Property EBITDAR at our Las Vegas Operations increased $69.6 million for the six months ended June 30, 2023, primarily due to an increase in revenues from casino, hotel, and food and beverage operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Encore Boston Harbor increased $5.4 million and $13.5 million for the three and six months ended June 30, 2023, primarily due to an increase in revenues from casino operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Wynn Interactive increased $6.0 million and $16.4 million for the three and six months ended June 30, 2023, primarily due to a decrease in marketing and promotional expense.

Refer to the discussions above regarding the specific details of our results of operations.

1 unchanged sentence

Our cash flows were as follows (in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

Cash Flows - Summary 2023 2022

2 unchanged sentences

Capital expenditures, net of construction payables and retention (215,299) (186,038)

Purchase of investment securities (286,519) —

Purchase of intangible and other assets (42,933) (9,375)

5 unchanged sentences

Repurchase of common stock (12,094) (149,305)

Proceeds from exercise of stock options 1,965 —

Proceeds from issuance of subsidiary common stock — 2,895

Proceeds from sale of noncontrolling interest in subsidiary — 50,033

4 unchanged sentences

Other (7,773) —

Net cash provided by financing activities 121,003 10,872

Net cash used in financing activities (18,807) (150,906)

Effect of exchange rate on cash, cash equivalents and restricted cash (2,864) (3,590)

Increase (decrease) in cash, cash equivalents and restricted cash $ 155,977 $ (204,653)

Decrease in cash, cash equivalents and restricted cash $ (35,193) $ (507,331)

Operating Activities

5 unchanged sentences

Accordingly, operating cash flows will be impacted by changes in operating income and accounts receivable, net.

During the three months ended March 31, 2023, the increase in cash flows from operating activities was primarily due to increased revenues from our Macau Operations, our Las Vegas Operations, and Encore Boston Harbor, which was partially offset by an increase in operating expenses associated with higher business volumes.

During the three months ended March 31, 2022, the decrease in net cash used in operating activities was primarily due to increased operating revenues, partially offset by an increase in operating expenses.

During the six months ended June 30, 2023, the increase in cash flows from operating activities was primarily due to increased revenues from our Macau Operations, our Las Vegas Operations, and Encore Boston Harbor, which was partially offset by an increase in operating expenses associated with higher business volumes.

During the six months ended June 30, 2022, the decrease in net cash used in operating activities was primarily due to increased revenues from our Las Vegas Operations and Encore Boston Harbor, which was partially offset by decreases in revenues from Wynn Palace and Wynn Macau.

Investing Activities

Our investing activities primarily consist of project capital expenditures and maintenance capital expenditures associated with maintaining and continually refining our world-class integrated resort properties.

During the three months ended March 31, 2023, we incurred capital expenditures of $38.5 million at our Las Vegas Operations, $30.1 million at Encore Boston Harbor, $6.4 million at Wynn Palace, and $3.0 million at Wynn Macau primarily related to maintenance capital expenditures, and $46.5 million at Corporate and other primarily related to future development projects.

During the three months ended March 31, 2022, we incurred capital expenditures of $67.8 million at our Las Vegas Operations primarily related to the Wynn Las Vegas room remodel, and $7.5 million at Encore Boston Harbor, $13.1 million at Wynn Palace, and $4.2 million at Wynn Macau, each primarily related to maintenance capital expenditures.

During the six months ended June 30, 2023, we incurred capital expenditures of $96.1 million at our Las Vegas Operations, $41.3 million at Encore Boston Harbor, $14.1 million at Wynn Palace, and $8.9 million at Wynn Macau primarily related to maintenance capital expenditures, and $55.0 million at Corporate and other primarily related to future development projects.

In addition, during the six months ended June 30, 2023, we purchased $286.5 million in investment securities.

During the six months ended June 30, 2022, we incurred capital expenditures of $140.8 million at our Las Vegas Operations primarily related to the Wynn Las Vegas room remodel and the theater reconfiguration, and $10.6 million at Encore Boston Harbor, $22.3 million at Wynn Palace, and $7.7 million at Wynn Macau primarily related to maintenance capital expenditures.

Financing Activities

During the three months ended March 31, 2023, the cash flows from financing activities was primarily due to the following debt issuances and repayments (in thousands):

During the six months ended June 30, 2023, the cash flows from financing activities was primarily due to the following debt issuances and repayments (in thousands):

Proceeds from issuance Repayments

5 unchanged sentences

Total $ 1,200,000 $ 1,112,500

In addition, during the three months ended March 31, 2023, we paid $31.3 million for financing costs related to the financing activities above.

During the three months ended March 31, 2022, we received a $50.0 million contribution from a noncontrolling interest holder in exchange for a 49.9% interest in certain retail space contributed by the Company to the Retail Joint Venture.

In addition, we made a $12.5 million quarterly amortization payment under the WRF Term Loan Facility.

In addition, during the six months ended June 30, 2023, we made dividend payments of $28.7 million, paid $41.1 million for financing costs related to the financing activities above and used cash of $8.9 million for distributions to noncontrolling interest holders of the Retail Joint Venture.

During the six months ended June 30, 2022, we repurchased 2,381,928 shares of our common stock for approximately $137.4 million.

In addition, we received a $50.0 million contribution from a noncontrolling interest holder in exchange for a 49.9% interest in certain retail space contributed by the Company to the Retail Joint Venture, used cash of $16.5 million for distributions to noncontrolling interest holders of the Retail Joint Venture, and made quarterly amortization payments under the WRF Term Loan totaling $25.0 million.

Capital Resources

The following table summarizes our unrestricted cash and cash equivalents and available revolver borrowing capacity presented by significant financing entity as of March 31, 2023 (in thousands):

The following table summarizes our unrestricted cash and cash equivalents and available revolver borrowing capacity presented by significant financing entity as of June 30, 2023 (in thousands):

Total Cash and Cash Equivalents Revolver Borrowing Capacity

8 unchanged sentences

We expect to use this cash to fund working capital and capital expenditure requirements at WML and our Macau Operations, and to service our WML Senior Notes, WM Cayman II Revolver, and WML Convertible Bonds.

WML paid no dividends during 2022 or the three months ended March 31, 2023.

The borrowings under the WM Cayman II Revolver bear interest at LIBOR or HIBOR plus a margin of 2.625% per annum until June 30, 2023, the date from which the margin will be 1.875% to 2.875% per annum based on WM Cayman II’s leverage ratio on a consolidated basis.

The final maturity of all outstanding loans under the Revolving Facility is September 16, 2025.

On May 5, 2022, WM Cayman II and its lenders agreed to waive certain financial covenants in the facility agreement under the WM Cayman II Revolver in respect of the relevant periods ending on the following applicable test dates:

WML paid no dividends during 2022 or the first half of 2023.

The borrowings under the WM Cayman II Revolver bore interest at LIBOR or HIBOR plus a margin of 1.875% to 2.875% per annum based on WM Cayman II's leverage ratio on a consolidated basis subject to a floor on the interest rate margin of 2.625% per annum through June 30, 2023.

Pursuant to the amended and restated facility agreement dated June 27, 2023, the base rate applicable to loans denominated in U.S.

dollars made pursuant to the WM Cayman II Revolver transitioned to the term secured overnight financing rate ("Term SOFR"), plus 0.10% (which is subject to a minimum floor of 0.00%), plus (b) a margin of 1.875% to 2.875% per annum based on WM Cayman II’s leverage ratio on a consolidated basis.

The new Term SOFR base rate became effective July 4, 2023.

The final maturity of all outstanding loans under the Revolving Facility remains unchanged at September 16, 2025.

The amended and restated facility agreement also reflected the prior agreement of the lenders under the WM Cayman II Revolver to waive certain financial covenants therein in respect of the relevant periods ending on the following applicable test dates:

(a) June 30, 2022;

(b) September 30, 2022;

2 unchanged sentences

and to provide for a floor on the interest rate margin of 2.625% per annum through June 30, 2023.

WML , as guarantor, may be subject to certain restrictions on payments of dividends or distributions to its shareholders, unless certain financial criteria have been satisfied through the facility agreement.

WML , as guarantor, may be subject to certain restrictions on payments of dividends or distributions to its shareholders, unless certain financial criteria have been satisfied.

On March 7, 2023, WML completed an offering (the "Offering") of $600.0 million 4.50% convertible bonds due 2029 (the "WML Convertible Bonds").

The WML Convertible Bonds are constituted by a trust deed dated March 7, 2023 (the "Trust Deed").

The WML Convertible Bonds are governed by a trust deed dated March 7, 2023 (the "Trust Deed").

The net proceeds from the Offering, after deduction of commission and other related expenses, were $585.9 million.

8 unchanged sentences

If our portion of our cash and cash equivalents were repatriated to the U.S.

on March 31, 2023, it would be subject to minimal U.S.

on June 30, 2023, it would be subject to minimal U.S.

taxes in the year of repatriation.

6 unchanged sentences

On February 16, 2023, WRF and its subsidiary Wynn Resorts Capital Corp.

(together with WRF, the “WRF Issuers”) issued $600.0 million aggregate principal amount of 7 1/8% Senior Notes due 2031 (the "2031 WRF Senior Notes") in a private offering.

(together with WRF, the "WRF Issuers") issued $600.0 million aggregate principal amount of 7 1/8% Senior Notes due 2031 (the "2031 WRF Senior Notes") in a private

The 2031 WRF Senior Notes were issued at par, for proceeds of $596.2 million, net of $3.8 million of related fees and expenses.

3 unchanged sentences

In March 2023, we repurchased all of the outstanding Wynn Las Vegas 4.25% Senior Notes due 2023 of $500.0 million using cash held by WRF, at a price equal to 100% of the principal amount plus accrued interest under the terms of their indenture.

On May 17, 2023, WRF and certain of its subsidiaries entered into an amendment (the "WRF Credit Agreement Amendment") to its existing credit agreement (the "WRF Credit Agreement").

The WRF Credit Agreement Amendment amends the WRF Credit Agreement to:

(i) transition the benchmark rate from LIBOR to Term SOFR and to make conforming changes, (ii) reduce the aggregate principal amount of revolving commitments under the revolving credit facility by $100.0 million, from $850.0 million to $750.0 million, (iii) extend the stated maturity date for lenders electing to extend their revolving commitments in an amount equal to approximately $681.3 million from September 20, 2024 to September 20, 2027, and (iv) extend the stated maturity date for lenders electing to extend their term loan commitments in an amount equal to approximately $749.4 million from September 20, 2024 to September 20, 2027.

Lenders who elected not to extend their revolving commitments in an amount equal to approximately $68.7 million will remain subject to a stated maturity date of September 20, 2024, and lenders who elected not to extend their term loan commitments in an amount equal to approximately $75.6 million will remain subject to a stated maturity date of September 20, 2024.

Wynn Resorts, Limited and other subsidiaries.

3 unchanged sentences

We expect to use cash held by Wynn Resorts, Limited and other to service our Retail Term Loan, to pay dividends, to fund future development projects, and for general corporate purposes.

Wynn Resorts, Limited has resumed its quarterly dividend program, with a cash dividend of $0.25 per share declared on May 9, 2023, payable on June 6, 2023 to stockholders of record as of May 23, 2023.

On June 2, 2023, the Company entered into a second amendment to the existing term loan agreement (the "Retail Term Loan Amendment") which transitions the benchmark interest rate of the Retail Term Loan from LIBOR to the adjusted daily simple secured overnight financing rate ("SOFR") and to make related conforming changes, effective July 3, 2023.

On June 6, 2023, the Company paid a cash dividend of $0.25 per share to stockholders of record as of May 23, 2023.

On August 9, 2023, the Company declared a cash dividend of $0.25 per share, payable on August 31, 2023 to stockholders of record as of August 21, 2023.

Other Factors Affecting Liquidity

7 unchanged sentences

Under the equity repurchase program, we may repurchase the Company's outstanding shares from time to time through open market purchases, in privately negotiated transactions, and under plans complying with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended (the "Exchange Act").

During the three months ended March 31, 2023, we did not repurchase any shares of our common stock under this equity repurchase program.

As of March 31, 2023, we had $628.8 million in repurchase authority remaining under the program.

During the three and six months ended June 30, 2023, we did not

repurchase any shares of our common stock under this equity repurchase program.

As of June 30, 2023, we had $628.8 million in repurchase authority remaining under the program.

We have in the past repurchased, and in the future, we may periodically consider repurchasing our outstanding notes for cash.

6 unchanged sentences

Contractual Commitments

During the three months ended March 31, 2023, except as described below, there have been no material changes to the contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022.

During the three months ended March 31, 2023, our fixed interest rate long-term debt obligations increased by a net amount of $193.5 million, as a result of $1.20 billion in long-term debt issuances, net of $1.01 billion in debt repayments.

During the six months ended June 30, 2023, except as described below, there have been no material changes to the contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022.

During the six months ended June 30, 2023, our fixed interest rate long-term debt obligations increased by a net amount of $100.0 million, as a result of $1.20 billion in long-term debt issuances, net of $1.10 billion in debt repayments.

Additionally, our annual fixed interest payments are expected to increase $10.4 million in 2023, $23.3 million in 2024, $56.2 million in 2025, $69.8 million in each of 2026 and 2027, and $166.2 million thereafter, primarily as a result of the issuance of the WRF 2031 Senior Notes and the WML Convertible Bonds and the repurchase of the tendered 2025 WRF Senior Notes and the 2023 Wynn Las Vegas Senior Notes, each as described above.

1 unchanged sentence

A description of our critical accounting policies is included in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022.

Except as described below, there have been no significant changes to these policies for the three months ended March 31, 2023:

Except as described below, there have been no significant changes to these policies for the six months ended June 30, 2023:

WML Convertible Bond Conversion Option Derivative

1 unchanged sentence

The Company determined that the conversion feature contained within the WML Convertible Bonds is not indexed to WML's equity and, as such, is required to be bifurcated from the debt host contract and accounted for as a free-standing derivative (the "WML Convertible Bonds Conversion Option Derivative").

In accordance with applicable accounting standards, the WML Convertible Bond Conversion Option Derivative will be recorded at fair value each reporting period, with changes recognized in the statement of operations.

In accordance with applicable accounting standards, the WML Convertible Bond Conversion Option Derivative will be reported at fair value as of the end of each reporting period, with changes recognized in the statement of operations.

The Company used a binomial lattice model in order to estimate the fair value of the embedded derivative in the WML Convertible Bonds.

8 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis