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Macau's Recovery Has Casino Operators Restarting Dividend Payments

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Wynn Macau and MGM China, two prominent casino operators in Macau, have announced plans to issue dividends, marking a significant milestone as they recover from the financial impacts of the COVID-19 pandemic.

Galaxy Entertainment Group, another major player in Macau's casino industry, set a precedent by becoming the first concessionaire to resume dividend payments post-COVID-19. It was the sole company to declare an interim dividend in 2023, indicating confidence in its financial recovery and future prospects.

Wynn Macau Rebounds

Wynn Macau, a subsidiary of Wynn Resorts, disclosed that its Board has recommended a final dividend for the fiscal year ending on December 31, 2023. The proposed final dividend of HKD0.075 (US$0.0096) per share still has to be approved by shareholders before it can be distributed.

Related: Macau's Casinos Get Off to a Strong Start in 2024

This announcement comes as Wynn Macau reported a profit of HKD1.17 billion (US$150 million) for 2023, a notable turnaround from the HKD7.35 billion (US$940 million) loss incurred in 2022. The company attributed this success to operating revenues totaling HKD24.3 billion (US$3.11 billion), including significant total casino revenue of HKD19.1 billion (US$2.44 billion) and Adjusted EBITDA of HKD6.62 billion (US$846 million).

The decision to resume dividends follows recent remarks by Wynn Macau's senior leadership regarding the company's capital return policy. Wynn Resorts CEO Craig Billings emphasized the importance of stabilizing the company's balance sheets, particularly with EBITDA (earnings before interest, taxes, depreciation and amortization) leverage at approximately 7x at the end of last year.

MGM China Sees Significant Improvement

Meanwhile, MGM China disclosed a Special Dividend of HKD0.104 (US$0.013) per share for the fiscal year 2023. This announcement was made alongside the company's final results announcement for 2023, which was published on Thursday.

The financial report revealed that MGM China achieved a profit attributable to owners of the company amounting to HKD2.64 billion (US$337.4 million) for the year. This marked a significant turnaround from the HKD5.23 billion (US$669 million) loss recorded in the previous fiscal year.

The Special Dividend declared by MGM China represents an aggregate amount of HKD395.2 million (US$50.5 million) or 15% of the group's profit.

The company also announced the termination of a US$750-million revolving loan facility provided by its majority owner, MGM Resorts International. Initially established to address working capital and funding needs during the pandemic, the loan facility was deemed unnecessary, given the current financial position of the company.

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