Melco Crown Entertainment Limited (MPEL) operates casino gaming and entertainment resort facilities in Asia. In order to cash in on a fast growing Philippine economy and increased tourism, Melco Crown recently launched its long-awaited new integrated casino resort, City of Dreams Manila. It is a part of the company’s plans to have casinos across Asia.
Meanwhile, Melco Crown earns a better part of its revenues from Macau, the only gambling destination in China. However, gambling revenues in Macau are currently slowing down due to anti-graft corruption drive undertaken by the Chinese government.
Investors should also note the recent earnings estimate revisions for MPEL, as the consensus estimate has been almost moving downwards. Meanwhile, MPEL has a mixed history in earnings season. Melco Crown has missed earnings results in two of the last four quarters, making for an average negative surprise of 1.28%. Meanwhile, the company has posted positive revenue surprise in two of the trailing four quarters.
Currently, MPEL has a Zacks Rank #3 (Hold) but that could change following Melco Crown’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: MPEL misses on adjusted earnings. Our consensus earnings estimate called for EPS of 26 cents per share, and the company reported adjusted earnings per share of 22 cents instead. Investors should note that these figures take out stock option expenses.
Revenues: MPEL reported revenues of $1.12 billion. This missed our consensus estimate of 1.14 billion.
Key Stats to Note: Adjusted Property EBITDA was $278.6 million, down 29% year over year due to lower group-wide rolling chip volumes and rolling chip win rate and lower contribution from the mass market table games segment.
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