UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 7, 2017
WYNN RESORTS, LIMITED
(Exact name of registrant as specified in its charter)
Nevada | 000-50028 | 46-0484987 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
3131 Las Vegas Boulevard South Las Vegas, Nevada | 89109 | |
(Address of principal executive offices) | (Zip Code) | |
(702) 770-7555
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 7.01. | Regulation FD Disclosure. |
On September 7, 2017, Wynn Macau, Limited (“WML”), an indirect subsidiary of Wynn Resorts, Limited (the “Registrant”) with ordinary shares of its common stock listed on The Stock Exchange of Hong Kong Limited, filed its interim report in respect of the six months ended June 30, 2017 (the “Interim Report”) with The Stock Exchange of Hong Kong Limited. The Registrant owns approximately 72% of WML’s ordinary shares of common stock. The Interim Report is furnished herewith as Exhibit 99.1. The information in this Form 8-K and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. | Financial Statements and Exhibits |
(d) | Exhibits. |
Exhibit No. | Description | |
99.1 | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
WYNN RESORTS, LIMITED | ||||
Dated: September 7, 2017 | By: | /s/ Craig S. Billings | ||
Craig S. Billings | ||||
Chief Financial Officer and Treasurer | ||||
(Principal Financial and Accounting Officer) | ||||
2017 Interim Report 中期報告
201
7
Interim Repor
t
中期報告
Contents
2 Corporate Information
4 Highlights
5 Management Discussion and Analysis
33 Directors and Senior Management
48 Other Information
61 Report on Review of
Interim Financial Information
63 Interim Financial Information
94 Definitions
99 Glossary
2 Wynn Macau, Limited
Corporate Information
BOARD OF DIRECTORS
Executive Directors
Mr. Stephen A. Wynn (Chairman of the Board)
Ms. Linda Chen
Mr. Ian Michael Coughlan
Non-Executive Directors
Mr. Matthew O. Maddox
Ms. Kim Sinatra (appointed on 1 April 2017)
Independent Non-Executive Directors
Dr. Allan Zeman, GBM, GBS, JP
(Vice-chairman of the Board)
Mr. Jeffrey Kin-fung Lam, GBS, JP
Mr. Bruce Rockowitz
Mr. Nicholas Sallnow-Smith
AUDIT AND RISK COMMITTEE
Mr. Nicholas Sallnow-Smith (Chairman)
Mr. Bruce Rockowitz
Dr. Allan Zeman, GBM, GBS, JP
REMUNERATION COMMITTEE
Mr. Nicholas Sallnow-Smith (Chairman)
Mr. Jeffrey Kin-fung Lam, GBS, JP
Mr. Matthew O. Maddox
Mr. Bruce Rockowitz
NOMINATION AND CORPORATE
GOVERNANCE COMMITTEE
Mr. Jeffrey Kin-fung Lam, GBS, JP (Chairman)
Mr. Nicholas Sallnow-Smith
Dr. Allan Zeman, GBM, GBS, JP
COMPANY SECRETARY
Ms. Ho Wing Tsz Wendy, FCIS, FCS
AUTHORIZED REPRESENTATIVES
Dr. Allan Zeman, GBM, GBS, JP
Ms. Ho Wing Tsz Wendy, FCIS, FCS
(Mrs. Seng Sze Ka Mee, Natalia as alternate)
AUDITOR
Ernst & Young
Certified Public Accountants
LEGAL ADVISORS
As to Hong Kong and U.S. laws:
Skadden, Arps, Slate, Meagher & Flom
As to Hong Kong law:
Mayer Brown JSM
As to Macau law:
Alexandre Correia da Silva
As to Cayman Islands law:
Maples and Calder
3Interim Report 2017
Corporate Information
REGISTERED OFFICE
P.O. Box 309
Ugland House
Grand Cayman
KY1-1104
Cayman Islands
HEADQUARTERS IN MACAU
Rua Cidade de Sintra
NAPE, Macau SAR
PRINCIPAL PLACE OF BUSINESS
IN HONG KONG
Level 54, Hopewell Centre
183 Queen’s Road East
Hong Kong
PRINCIPAL SHARE REGISTRAR AND
TRANSFER OFFICE
Estera Trust (Cayman) Limited
HONG KONG SHARE REGISTRAR
Computershare Hong Kong Investor
Services Limited
STOCK CODE
1128
COMPANY WEBSITE
www.wynnmacaulimited.com
4 Wynn Macau, Limited
High l i g hts
FINANCIAL HIGHLIGHTS
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands,
except per share amounts
or otherwise stated)
Casino revenues 15,603,397 9,153,749
Other revenues 1,187,534 536,076
Adjusted EBITDA 3,870,839 2,547,722
Profit attributable to owners 1,591,948 1,140,905
Earnings per Share – basic and diluted (HK$) 0.31 0.22
5Interim Report 2017
Management Discussion and Analysis
OVERVIEW
We are a developer, owner and operator of two integrated destination casino resorts in Macau,
Wynn Macau and Wynn Palace.
We operate integrated resorts that attract a wide range of customer segments and generate strong
financial results. To attract and retain our customers, we design and continually make enhancements
and refinements to refresh and improve our resorts and to create unique customer experiences
across a wide range of gaming and non-gaming amenities. Our emphasis on human resources and
staff training underscores our commitment to providing our customers with superior levels of luxury
service and guest experience. We also leverage Wynn International Marketing, Ltd.’s international
branch offices located in Macau, Hong Kong, Singapore, Taiwan, Japan and the United States to
attract international customers.
On 12 August 2016, WRM received notification from The Gaming Inspection and Coordination
Bureau of Macau (“DICJ”) that Wynn Palace was approved to commence operations on 22 August
2016. DICJ authorized 100 new table games for operation at Wynn Palace effective 22 August 2016,
25 new table games for operation effective 1 January 2017 and 25 new table games for operation
effective 1 January 2018 for a total of 150 new table games in the aggregate. DICJ also approved
1,145 slot machines for operation at Wynn Palace effective 22 August 2016. We transfer table games
between our Macau properties to optimize our casino operations.
Wynn Macau
Wynn Macau opened to the public on 6 September 2006 at the center of casino activities on the
urban Macau peninsula. We completed expansion works at Wynn Macau in December 2007 and
November 2009, adding more gaming space and additional food and beverage and retail amenities.
Encore at Wynn Macau, a further expansion of Wynn Macau that added hotel accommodations and a
range of gaming and non-gaming amenities, opened in April 2010.
6 Wynn Macau, Limited
Management Discussion and Analysis
Wynn Macau features:
• Approximately 281,000 square feet of casino space, offering 24-hour gaming and a full range of
games, including private gaming salons, sky casinos and a poker pit;
• Two luxury hotel towers with a total of 1,008 spacious rooms and suites;
• Casual and fine dining in eight restaurants;
• Approximately 59,000 square feet of high-end, brand-name retail shopping;
• Recreation and leisure facilities, including two health clubs and spas, a salon and a pool;
• A rotunda show featuring a Chinese zodiac-inspired ceiling along with gold “prosperity tree”
and a “dragon of fortune” attractions; and
• Approximately 31,000 square feet of meeting and convention space.
The following table presents the number of casino games available at Wynn Macau:
As at 30 June
2017 2016
VIP table games 93 178
Mass market table games 206 230
Slot machines 948 805
Poker tables 13 14
7Interim Report 2017
Management Discussion and Analysis
Wynn Palace
On 22 August 2016, we opened Wynn Palace in the Cotai area of Macau.
Wynn Palace features:
• Approximately 420,000 square feet of casino space, offering 24-hour gaming and a full range of
games, including private gaming salons, sky casinos and a poker pit;
• A luxury hotel with a total of 1,706 spacious rooms, suites and villas;
• Casual and fine dining in eleven food and beverage outlets;
• Approximately 106,000 square feet of high-end, brand-name retail shopping;
• Recreation and leisure facilities, including a cable car (“Sky Cab”) ride, health club, spa, salon
and pool;
• Public attractions including an 8-acre performance lake, floral art displays and fine art displays;
and
• Approximately 37,000 square feet of meeting and convention space.
The following table presents the number of casino games available at Wynn Palace:
As at 30 June
2017 2016
VIP table games 104 —
Mass market table games 202 —
Slot machines 1,141 —
Poker tables 4 —
8 Wynn Macau, Limited
Management Discussion and Analysis
FACTORS AFFECTING OUR RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Macau
Macau, which was a territory under Portuguese administration for approximately 450 years, was
transferred from Portuguese to Chinese political control in December 1999. Macau is governed
as a special administrative region of China and is located approximately 37 miles southwest of,
and approximately one hour away via ferry from, Hong Kong. Macau, which has been a casino
destination for more than 50 years, consists principally of a peninsula on mainland China, and two
neighboring islands, Taipa and Coloane, between which the Cotai area is located. We believe that
Macau is located in one of the world’s largest concentrations of potential gaming customers. Since
the introduction of new casinos starting in 2004, the Macau market has experienced a significant
increase in annual gaming revenue from the HK$21.5 billion generated in 2002. According to Macau
statistical information, casinos in Macau generated approximately HK$122.7 billion in gaming
revenue during the six months ended 30 June 2017, an increase of approximately 17.2% over the
approximate HK$104.6 billion generated in the six months ended 30 June 2016, making Macau the
largest gaming market in the world.
Tourism
The levels of tourism and overall gaming activities in Macau are key drivers of our business. Both
the Macau gaming market and visitation to Macau grew significantly from liberalization in 2002 to
2014. From the first quarter of 2015 until the second quarter of 2016, the Macau gaming market
experienced a period of decline in both revenue and visitation. In the third quarter of 2016, both
metrics began to improve and statistics for the first half of 2017 reflect a year-over-year increase
of 5.4 % with 15.6 million tourist arrivals to Macau. We have benefited from the rise in visitation to
Macau during the first half of 2017.
The Macau market has experienced tremendous growth in capacity since the opening of Wynn
Macau in 2006. As at 30 June 2017, there were 36,600 hotel rooms, 6,413 table games and 16,204
slots in Macau, compared to 12,978 hotel rooms, 2,762 table games and 6,546 slots as at 31
December 2006.
Gaming customers traveling to Macau typically come from nearby destinations in Asia, including
mainland China, Hong Kong, Taiwan, South Korea and Japan. According to the Macau Statistics and
Census Service Monthly Bulletin of Statistics, approximately 89.8% of visitors to Macau for the six
months ended 30 June 2017 were from mainland China, Hong Kong and Taiwan.
9Interim Report 2017
Management Discussion and Analysis
Tourism levels in Macau are affected by a number of factors, all of which are beyond our control. Key
factors affecting tourism levels in Macau may include, among others:
• Prevailing economic conditions in mainland China and Asia;
• Restrictions, conditions or other factors which affect visitation by citizens of mainland China to
Macau;
• Various countries’ policies on currency exchange controls and currency export restrictions, for
example on the Renminbi, the currency of the PRC, and the issuance of travel visas that may be
in place from time to time;
• Competition from other destinations which offer gaming and/or leisure activities;
• Occurrence of natural disasters and disruption of travel; and
• Possible outbreaks of infectious disease.
Economic and Operating Environment
A significant number of our gaming customers come from mainland China. Economic disruption,
contraction or uncertainty in China can impact the number of patrons visiting our properties or the
amount they may be willing to spend. In addition, policies adopted from time to time by the Chinese
government, including any travel restrictions imposed by China on its citizens, such as restrictions
imposed on exit visas granted to residents of mainland China for travel to Macau, could disrupt the
number of visitors from mainland China to our resorts. It is not known when, or if, policies restricting
visitation by mainland Chinese citizens to Macau and Hong Kong will be put in place and travel
policies may be adjusted, without notice, in the future. Furthermore, the Chinese government’s
ongoing anti-corruption campaign has influenced the behavior of Chinese consumers and their
spending patterns both domestically and abroad. The campaign has specifically led to tighter
monetary transfer regulations, including real time monitoring of certain financial channels, limitations
on cash withdrawals from ATM machines and “know your client” protocols implemented on ATM
machines, which has affected and may continue to impact the number of visitors and the amount of
money they bring from mainland China to Macau. The overall effect of the campaign and monetary
transfer restrictions may negatively affect our revenues and results of operations.
10 Wynn Macau, Limited
Management Discussion and Analysis
Competition
Since the liberalization of Macau’s gaming industry in 2002, there has been a significant increase
in the number of casino properties in Macau. There are six gaming operators in Macau, including
WRM. The three concessionaires are WRM, SJM, and Galaxy. The three subconcessionaires are
Melco, MGM Macau, and Venetian Macau. As at 30 June 2017, there were approximately 39 casinos
in Macau, including 21 operated by SJM. Each of the six current operators has operational casinos
and several have expansion plans underway. The Macau government has had the ability to grant
additional gaming concessions since April 2009. If the Macau government were to allow additional
competitors to operate in Macau through the grant of additional concessions or subconcessions,
we would face additional competition, which could have a material adverse effect on our business,
financial condition, results of operations and cash flows. During 2016, several new resorts opened
in the Cotai area of Macau, including Wynn Palace. Several more resorts from our competitors are
expected to open in the second half of 2017 and during 2018. These Cotai facilities are expected
to increase total hotel room inventory by approximately 12.0% from the current inventory and
significantly increase other gaming and non-gaming offerings in Macau.
Wynn Macau and Wynn Palace also face competition from casinos located in Singapore, the
Philippines and Malaysia. Our resorts also encounter competition from other major gaming centers
located around the world, including Australia and Las Vegas, cruise ships in Asia that offer gaming
and other casinos throughout Asia. Further, if current efforts to legalize gaming in other Asian
countries, such as Japan, are successful, our resorts will face additional regional competition.
Gaming Concession
The Macau government has publicly commented that it is studying the process by which gaming
concessions and subconcessions will be renewed. Our gaming concession ends in 2022 along with
Galaxy’s, Venetian Macau’s and Melco’s. SJM’s and MGM Macau’s concessions end in 2020.
Gaming Promoters
A significant amount of our casino play is brought to us by gaming promoters. Gaming promoters
have historically played a critical role in the Macau gaming market and are important to our casino
business.
11Interim Report 2017
Management Discussion and Analysis
Gaming promoters introduce premium VIP players to Wynn Macau and Wynn Palace and often assist
those players with their travel and entertainment arrangements. In addition, gaming promoters often
grant credit to their players. In exchange for their services, Wynn Macau and Wynn Palace pay the
gaming promoters a commission which is a percentage of the gross gaming win generated by each
gaming promoter. Approximately 80% of these commissions are netted against casino revenues,
because such commissions approximate the amount of the commission returned to the VIP players
by the gaming promoters, and approximately 20% of these commissions are included in other
operating expenses, which approximate the amount of the commission ultimately retained by the
gaming promoters as compensation. The total amount of commissions paid to gaming promoters
and netted against casino revenues was HK$3.6 billion and HK$1.7 billion for the six months ended
30 June 2017 and 2016, respectively. Commissions increased 110.0% for the six months ended 30
June 2017 compared to the six months ended 30 June 2016 as VIP gross table games win increased
due to increased business volumes at Wynn Macau and the opening of Wynn Palace in the third
quarter of 2016.
We typically advance commissions to certain selected gaming promoters with strong operational
performance history at the beginning of each month to facilitate their working capital requirements.
These advances are provided to a gaming promoter and are offset by the commissions earned
by such gaming promoter during the applicable month. The aggregate amounts of exposure to
our gaming promoters, which is the difference between commissions advanced to each individual
gaming promoter, and the net commissions payable to each such gaming promoter, increased
primarily due to increased business volumes at Wynn Macau and Wynn Palace, to HK$73.0 million
as at 30 June 2017 from HK$37.0 million as at 31 December 2016. At the end of each month, any
commissions outstanding are cleared no later than the fifth business day of the succeeding month
and prior to the advancement of any further funds to a gaming promoter. We believe we have
developed strong relationships with our gaming promoters. Our commission percentages have
remained stable throughout our operating history.
In addition to commissions, gaming promoters each receive a monthly complimentary allowance
based on a percentage of the turnover its clients generate. The allowance is available for room, food
and beverage and other products and services for discretionary use with the gaming promoter’s
clients.
Gaming promoters may experience certain difficulties in their Macau operations, including intensified
competition in attracting patrons to come to Macau depending on certain factors, including Chinese
government policies. These factors may cause gaming promoters to face a decrease in liquidity,
limiting their ability to grant credit to their patrons, and difficulties in collecting credit they extend.
12 Wynn Macau, Limited
Management Discussion and Analysis
Premium Credit Play
We selectively extend credit to our VIP players contingent upon our marketing team’s knowledge of
the players, their financial background and payment history. We follow a series of credit procedures
and require various signed documents from each credit recipient that are intended to ensure
that, among other things, if permitted by applicable law, the debt can be legally enforced in the
jurisdiction where the player resides. In the event the player does not reside in a jurisdiction where
gaming debts are legally enforceable, we can attempt to assert jurisdiction over assets the player
maintains in jurisdictions where gaming debts are recognized. In addition, we typically require a
check in the amount of the applicable credit line from credit players, collateralizing the credit we
grant.
Number and Mix of Table Games and Slot Machines
The mix of VIP table games, mass table games and slot machines in operation at our resorts changes
from time to time as a result of marketing and operating strategies in response to changing market
demand and industry competition. The shift in the mix of our games will affect casino profitability.
ADJUSTED EBITDA
Adjusted EBITDA is earnings before finance costs, finance revenues, net foreign currency
differences, changes in fair value of interest rate swaps, taxes, depreciation and amortization, pre-
opening costs, property charges and other, share-based payments, Wynn Macau, Limited corporate
expenses, and other non-operating income and expenses. Adjusted EBITDA is presented exclusively
as a supplemental disclosure because our Directors believe that it is widely used to measure the
performance, and as a basis for valuation, of gaming companies. Our Adjusted EBITDA presented
herein also differs from the Adjusted Property EBITDA presented by Wynn Resorts, Limited for its
Macau segments in its filings with the SEC, primarily due to the inclusion of license fees, adjustments
for IFRS differences with U.S. GAAP, corporate support and other support services in arriving at
operating profit.
13Interim Report 2017
Management Discussion and Analysis
The following table sets forth a quantitative reconciliation of Adjusted EBITDA to its most directly
comparable IFRS measurement and operating profit.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
Operating profit 2,367,461 1,460,382
Add
Depreciation and amortization 1,393,098 464,141
Pre-opening costs — 507,755
Property charges and other 7,739 8,897
Share-based payments 62,339 64,015
Wynn Macau, Limited corporate expenses 40,202 42,532
Adjusted EBITDA 3,870,839 2,547,722
14 Wynn Macau, Limited
Management Discussion and Analysis
REVIEW OF HISTORICAL OPERATING RESULTS
Summary Breakdown Table
The following table presents certain selected statement of profit or loss and other comprehensive
income line items and certain other data.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
Wynn Macau:
Casino revenues(1) 9,381,784 9,153,749
Rooms(2) 55,464 62,909
Food and beverage(2) 98,147 107,554
Retail and other(2) 333,933 365,613
Wynn Palace(5):
Casino revenues(1) 6,221,613 —
Rooms(2) 186,678 —
Food and beverage(2) 159,171 —
Retail and other(2) 354,141 —
Total operating revenues 16,790,931 9,689,825
15Interim Report 2017
Management Discussion and Analysis
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands, except for
averages, daily win figures
and number of tables and
slot machines)
Wynn Macau:
VIP:
VIP table games turnover 227,814,358 196,601,773
VIP gross table games win(1) 7,813,649 6,599,211
VIP gross table games win as a percentage of turnover
(calculated before commission) 3.4% 3.4%
Average number of gaming tables(3) 92 186
Daily gross win per gaming table(4) 467,491 194,581
Mass market:
Mass market table drop 17,134,027 18,510,203
Mass market gross table games win(1) 3,361,009 3,733,204
Mass market gross table games win percentage 19.6% 20.2%
Average number of gaming tables(3) 204 242
Daily gross win per gaming table(4) 90,934 84,874
Slot machine handle 13,404,479 14,780,922
Slot machine win(1) 601,147 643,294
Average number of slots(3) 901 778
Average daily win per slot(4) 3,684 4,542
Wynn Palace(5):
VIP:
VIP table games turnover 176,024,577 —
VIP gross table games win(1) 4,564,856 —
VIP gross table games win as a percentage of turnover
(calculated before commission) 2.6% —
Average number of gaming tables(3) 98 —
Daily gross win per gaming table(4) 257,552 —
16 Wynn Macau, Limited
Management Discussion and Analysis
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands, except for
averages, daily win figures
and number of tables and
slot machines)
Mass market:
Mass market table drop 11,650,519 —
Mass market gross table games win(1) 2,605,054 —
Mass market gross table games win percentage 22.4% —
Average number of gaming tables(3) 206 —
Daily gross win per gaming table(4) 69,846 —
Slot machine handle 10,224,074 —
Slot machine win(1) 530,811 —
Average number of slots(3) 1,011 —
Average daily win per slot(4) 2,902 —
Notes:
(1) Total casino revenues do not equal the sum of “VIP gross table games win”, “mass market gross table games
win” and “slot machine win” because casino revenues are reported net of the relevant commissions. The
following table presents a reconciliation of the sum of “VIP gross table games win”, “mass market gross table
games win” and “slot machine win” to total casino revenues.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
VIP gross table games win 12,378,505 6,599,211
Mass market gross table games win 5,966,063 3,733,204
Slot machine win 1,131,958 643,294
Poker revenues 78,188 79,417
Commissions (3,951,317) (1,901,377)
Total casino revenues 15,603,397 9,153,749
17Interim Report 2017
Management Discussion and Analysis
(2) Promotional allowances are excluded from revenues in the accompanying condensed consolidated statement of
profit or loss and other comprehensive income prepared in accordance with IFRS. Management also evaluates
non-casino revenues on an adjusted basis when assessing performance.
The following table presents a reconciliation of net non-casino revenues as reported in our condensed
consolidated statement of profit or loss and other comprehensive income to gross non-casino revenues
calculated on the adjusted basis. The adjusted non-casino revenues as presented below are used for
management reporting purposes and are not representative of revenues as determined under IAS 18.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
Room revenues 242,142 62,909
Promotional allowances 739,696 401,013
Adjusted room revenues 981,838 463,922
Food and beverage revenues 257,318 107,554
Promotional allowances 282,249 174,135
Adjusted food and beverage revenues 539,567 281,689
Retail and other revenues 688,074 365,613
Promotional allowances 50,689 14,192
Adjusted retail and other revenues 738,763 379,805
(3) For purposes of this table, we calculate average number of gaming tables and average number of slots as the
average numbers of gaming tables and slot machines in service on each day in the period.
(4) Daily gross win per gaming table and daily win per slot are presented in this table on the basis of the average
number of gaming tables and average number of slots, respectively, over the number of days Wynn Macau,
Encore, and Wynn Palace were open in the applicable period. In addition, the total table games win figures
used herein do not correspond to casino revenues figures in our financial information, because figures in our
financial information are calculated net of commissions and the total table games win herein is calculated before
commissions.
(5) Wynn Palace opened on 22 August 2016.
18 Wynn Macau, Limited
Management Discussion and Analysis
Discussion of Results of Operations
Financial results for the six months ended 30 June 2017 compared to financial results for the six
months ended 30 June 2016
Operating Revenues
Total operating revenues increased 73.3% from HK$9.7 billion in the six months ended 30 June 2016
to HK$16.8 billion in the six months ended 30 June 2017. This increase was primarily due to the
opening of Wynn Palace on 22 August 2016 and an increase from Wynn Macau driven by higher VIP
gaming volumes in the six months ended 30 June 2017 compared to the six months ended 30 June
2016.
Casino Revenues
Casino revenues increased 70.5% from HK$9.2 billion (94.5% of total operating revenues) in the six
months ended 30 June 2016 to HK$15.6 billion (92.9% of total operating revenues) in the six months
ended 30 June 2017. The components and reasons are as follows:
VIP casino gaming operations. VIP gross table games win increased by 87.6%, from HK$6.6 billion
in the six months ended 30 June 2016 to HK$12.4 billion in the six months ended 30 June 2017. The
increase was due to VIP gross table games win of HK$4.6 billion from Wynn Palace and an increase
of 18.4% in Wynn Macau VIP gross table games win. The increase in Wynn Macau VIP gross table
games win was primarily driven by an increase in business volumes, with VIP table games turnover
up 15.9%, from HK$196.6 billion in the six months ended 30 June 2016 to HK$227.8 billion in the six
months ended 30 June 2017. Wynn Macau VIP gross table games win as a percentage of turnover
(calculated before commissions) remained flat at 3.4% in the six months ended 30 June 2017, which
was above our expected range of 2.7% to 3.0%.
Mass market casino gaming operations. Mass market gross table games win increased by 59.8%,
from HK$3.7 billion in the six months ended 30 June 2016 to HK$6.0 billion in the six months ended
30 June 2017. The increase was due to mass market gross table win of HK$2.6 billion from Wynn
Palace, partially offset by a HK$372.2 million decrease at Wynn Macau. The decline in Wynn Macau
mass market gross table win was driven by a decrease in mass market table drop from HK$18.5
billion in the six months ended 30 June 2016 to HK$17.1 billion in the six months ended 30 June
2017 and a decrease in the mass market gross table games win percentage from 20.2% in the six
months ended 30 June 2016 to 19.6% in the six months ended 30 June 2017.
19Interim Report 2017
Management Discussion and Analysis
Slot machine gaming operations. Slot machine win increased by 76.0% from HK$643.3 million in
the six months ended 30 June 2016 to HK$1.1 billion in the six months ended 30 June 2017. The
increase was due to slot machine win of HK$530.8 million from Wynn Palace, partially offset by a
HK$42.1 million decrease at Wynn Macau. The decline in Wynn Macau slot machine win was primarily
driven by a decrease in business volumes, with slot machine handle down 9.3% from HK$14.8 billion
in the six months ended 30 June 2016 to HK$13.4 billion in the six months ended 30 June 2017.
Non-casino Revenues
Net non-casino revenues, which include rooms, food and beverage and retail and other revenues,
increased by 121.5% from HK$536.1 million (5.5% of total operating revenues) in the six months
ended 30 June 2016 to HK$1.2 billion (7.1% of total operating revenues) in the six months ended 30
June 2017. The increase in non-casino revenues was largely due to the opening of Wynn Palace on
22 August 2016.
Room. Our room revenues, which exclude promotional allowances in our condensed consolidated
statement of profit or loss and other comprehensive income, increased by 284.9% from HK$62.9
million in the six months ended 30 June 2016 to HK$242.1 million in the six months ended 30 June
2017.
Management also evaluates room revenues on an adjusted basis which include promotional
allowances when assessing performance. Adjusted room revenues including promotional allowances
increased by 111.6% from HK$463.9 million in the six months ended 30 June 2016 to HK$981.8
million in the six months ended 30 June 2017.
20 Wynn Macau, Limited
Management Discussion and Analysis
The following table presents additional information about our adjusted room revenues for Wynn
Macau and Wynn Palace (which include promotional allowances):
Adjusted room revenues information
For the Six Months Ended
30 June
2017 2016
Wynn Macau:
Adjusted Average Daily Rate (includes promotional allowances
of HK$1,754 in the six months ended 30 June 2017
and HK$2,171 in the six months ended 30 June 2016) HK$2,033 HK$2,505
Occupancy 96.6% 93.1%
Adjusted REVPAR (includes promotional allowances
of HK$1,695 in the six months ended 30 June 2017
and HK$2,022 in the six months ended 30 June 2016) HK$1,964 HK$2,333
Wynn Palace#:
Adjusted Average Daily Rate (includes promotional allowances
of HK$1,298 in the six months ended 30 June 2017
and nil in the six months ended 30 June 2016) HK$1,906 —
Occupancy 95.9% —
Adjusted REVPAR (includes promotional allowances
of HK$1,244 in the six months ended 30 June 2017
and nil in the six months ended 30 June 2016) HK$1,827 —
# Wynn Palace opened on 22 August 2016.
Food and beverage. Food and beverage revenues, which exclude promotional allowances in our
condensed consolidated statement of profit or loss and other comprehensive income, increased by
139.2% from HK$107.6 million in the six months ended 30 June 2016 to HK$257.3 million in the six
months ended 30 June 2017.
21Interim Report 2017
Management Discussion and Analysis
Management also evaluates food and beverage revenues on an adjusted basis including promotional
allowances when assessing performance. Food and beverage revenues adjusted to include these
promotional allowances increased by 91.5% from HK$281.7 million in the six months ended 30 June
2016 to HK$539.6 million in the six months ended 30 June 2017.
Retail and other. Our retail and other revenues, which exclude promotional allowances in our
condensed consolidated statement of profit or loss and other comprehensive income, increased by
88.2% from HK$365.6 million in the six months ended 30 June 2016 to HK$688.1 million in the six
months ended 30 June 2017.
Management also evaluates retail and other revenues on an adjusted basis which includes
promotional allowances when assessing performance. Adjusted retail and other revenues including
promotional allowances increased by 94.5% from HK$379.8 million in the six months ended 30 June
2016 to HK$738.8 million in the six months ended 30 June 2017.
Operating Costs and Expenses
Gaming taxes and premiums. Gaming taxes and premiums increased by 76.6% from HK$4.4 billion
in the six months ended 30 June 2016 to HK$7.8 billion in the six months ended 30 June 2017. This
increase from 2016 to 2017 was due primarily to gross gaming win generated after the opening
of Wynn Palace on 22 August 2016. The increase was commensurate with the 70.5% increase in
casino revenues. WRM is subject to a 35% gaming tax on gross gaming win. In addition, WRM is
also required to pay 4% of its gross gaming win as contributions for public development and social
facilities.
Staff costs. Staff costs increased by 30.8% from HK$1.8 billion in the six months ended 30 June
2016 to HK$2.3 billion in the six months ended 30 June 2017. The increase was due to increased
headcount for the operation of Wynn Palace.
Other operating expenses. Other operating expenses increased by 84.4% from HK$1.6 billion in
the six months ended 30 June 2016 to HK$3.0 billion in the six months ended 30 June 2017, driven
mainly by increase in business volume related expenses such as gaming promoters’ commissions,
license fees, cost of sales, advertising and promotion expenditures and other expenses, all primarily
due to the operating of Wynn Palace. The increase in business volume related expenses was partially
offset by a HK$21.8 million decrease in provision for doubtful accounts. The change in the provision
was primarily due to increased collection of casino accounts receivable that resulted in the reversal
of previously recorded allowance for doubtful accounts.
22 Wynn Macau, Limited
Management Discussion and Analysis
Depreciation and amortization. Depreciation and amortization in the six months ended 30 June
2016 increased 200.1% from HK$464.1 million to HK$1.4 billion in the six months ended 30 June
2017. The increase was primarily due to the opening of Wynn Palace with the associated buildings
and improvements and furniture, fixtures and equipment being placed in service.
Property charges and other. Property charges and other decreased from HK$8.9 million in the six
months ended 30 June 2016 to HK$7.7 million in the six months ended 30 June 2017. Amounts
in each period represent the gain/loss on the sale of equipment and other assets as well as costs
related to assets retired or abandoned as a result of renovating certain assets of the Company in
response to customer preferences and changes in market demand.
As a result of the foregoing, total operating costs and expenses increased by 75.3%, from HK$8.2
billion in the six months ended 30 June 2016 to HK$14.4 billion in the six months ended 30 June
2017.
Finance Revenues
Finance revenues decreased from HK$19.2 million in the six months ended 30 June 2016 to HK$5.0
million in the six months ended 30 June 2017. The decrease was primarily due to holding lower
average cash balances in the six months ended 30 June 2017 compared to 2016. During 2017 and
2016, our short-term investment strategy has been to preserve capital while retaining sufficient
liquidity. The majority of our cash equivalents were primarily in time deposits and fixed deposits with
a maturity of three months or less.
Finance Costs
Finance costs increased by 113.3%, from HK$293.4 million in the six months ended 30 June 2016
to HK$625.8 million in the six months ended 30 June 2017. The increase in finance costs was driven
by the decrease in capitalized interest from HK$331.2 million in the six months ended 30 June 2016
to nil in the six months ended 30 June 2017 due to the completion of Wynn Palace construction
activities in August 2016.
Interest Rate Swaps
As required under the terms of the Wynn Macau Credit Facilities, we have entered into agreements
which swap a portion of the interest on our loans from floating to fixed rates. These transactions do
not qualify for hedge accounting.
Changes in the fair value of our interest rate swaps are recorded as an increase or decrease in swap
fair value during each period. During the six months ended 30 June 2017 and 30 June 2016, we
recorded a loss of HK$8.2 million and HK$22.2 million, respectively, resulting from the movement in
the fair value of our interest rate swaps. These interest rate swaps expired in July 2017.
23Interim Report 2017
Management Discussion and Analysis
Income Tax Expense
In the six months ended 30 June 2017, our income tax expense was HK$6.2 million, compared to an
income tax expense of HK$7.5 million in the six months ended 30 June 2016. Our tax expense for
the six months ended 30 June 2017 and 2016 primarily relates to the current tax expense recorded
by our subsidiaries owning WRM’s shares under the WRM Shareholder Dividend Tax Agreement.
Net Profit Attributable to Owners of the Company
As a result of the foregoing, compared to HK$1.1 billion for the six months ended 30 June 2016, net
profit attributable to owners of the Company was HK$1.6 billion for the six months ended 30 June
2017.
LIQUIDITY AND CAPITAL RESOURCES
Capital Resources
Since the opening of Wynn Macau and Wynn Palace on 6 September 2006 and 22 August 2016,
respectively, we have generally funded our working capital and recurring expenses as well as capital
expenditures from cash flow from operations and cash on hand.
Our cash balances as at 30 June 2017 were approximately HK$2.3 billion. This cash is available for
operations, new development activities, enhancements to our operating properties, debt service and
retirement and general corporate purposes.
On 30 September 2015, WRM expanded the availability of borrowings under its senior secured bank
facility to approximately HK$23.8 billion consisting of an approximately HK$18.0 billion fully funded
senior secured term loan facility and an approximately HK$5.8 billion senior secured revolving credit
facility. WRM also has the ability to upsize the total senior secured facilities by approximately an
additional HK$7.8 billion equivalent (US$1.0 billion) pursuant to the terms and provisions of the
agreement for the Wynn Macau Credit Facilities. As at 30 June 2017, the Group had approximately
HK$4.3 billion of available borrowing capacity under the Wynn Macau Credit Facilities.
The Company issued 5.25% fixed rate, unsecured senior notes due 2021 with an aggregate principal
amount of US$1.35 billion (approximately HK$10.5 billion) for working capital requirements and
general corporate purposes.
On 18 July 2016, WMLF entered into an agreement as the borrower of a revolving credit facility for
initially up to HK$1.5 billion (approximately US$198.4 million) with Bank of China Limited, Macau
Branch as the lender. On 25 October 2016, the WMLF Revolving Credit Facility was amended and
upsized, increasing the available borrowing capacity to HK$3.9 billion (approximately US$495.9
million). The WMLF Revolving Credit Facility matures in July 2018 at which time any outstanding
borrowings must be repaid. As at 30 June 2017, the Group had HK$3.9 billion available borrowing
capacity under the WMLF Revolving Credit Facility.
24 Wynn Macau, Limited
Management Discussion and Analysis
Gearing Ratio
The gearing ratio is a key indicator of our Group’s capital structure. The gearing ratio is net debt
divided by total capital plus net debt. The table below presents the calculation of our gearing ratio.
As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands
except for percentages)
Interest-bearing borrowings 29,787,136 32,169,888
Accounts payable 519,129 525,501
Construction and retentions payables 1,007,158 1,168,326
Other payables and accruals 7,671,339 6,191,037
Amounts due to related companies 187,157 202,298
Other liabilities 217,386 222,932
Less: cash and cash equivalents (2,341,980) (2,591,442)
restricted cash and cash equivalents (18,825) (22,109)
Net debt 37,028,500 37,866,431
Equity 1,933,896 2,453,064
Total capital 1,933,896 2,453,064
Capital and net debt 38,962,396 40,319,495
Gearing ratio 95.0% 93.9%
25Interim Report 2017
Management Discussion and Analysis
Cash Flows
The following table presents a summary of the Group’s cash flows.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in millions)
Net cash generated from operating activities 5,434.9 1,990.2
Net cash used in investing activities (395.3) (3,370.3)
Net cash used in financing activities (5,291.1) (2,363.5)
Net decrease in cash and cash equivalents (251.5) (3,743.6)
Cash and cash equivalents at beginning of period 2,591.4 6,731.4
Effect of foreign exchange rate changes, net 2.1 3.7
Cash and cash equivalents at end of period 2,342.0 2,991.5
Net cash generated from operating activities
Our net cash generated from operating activities is primarily affected by changes in our working
capital and operating profit generated by our Macau Operations. Net cash from operating activities
was HK$5.4 billion for the six months ended 30 June 2017, compared to HK$2.0 billion for the
six months ended 30 June 2016. Operating profit was HK$2.4 billion for the six months ended 30
June 2017, compared to HK$1.5 billion for the six months ended 30 June 2016. The increase in net
cash from operating activities was primarily attributable to the changes in working capital and the
increase in operating profit.
Net cash used in investing activities
Net cash used in investing activities was HK$395.3 million for the six months ended 30 June 2017,
compared to HK$3.4 billion for the six months ended 30 June 2016. Net cash used in the six months
ended 30 June 2017 included capital expenditures of HK$401.4 million for renovations to enhance
and refine the Macau Operations, partially offset by HK$4.8 million of interest receipts and HK$1.4
million in proceeds from the sale of property and equipment and other assets. Net cash used in the
six months ended 30 June 2016 primarily included capital expenditures of HK$3.1 billion for both
Wynn Palace construction costs and renovations to enhance and refine the Wynn Macau operations
and fine arts acquisition cost of HK$263.2 million.
26 Wynn Macau, Limited
Management Discussion and Analysis
Net cash used in financing activities
Net cash used in financing activities was HK$5.3 billion during the six months ended 30 June 2017,
compared to HK$2.4 billion during the six months ended 30 June 2016.
During the six months ended 30 June 2017, the net cash used in financing activities was primarily
due to a HK$2.2 billion final dividend payment made in June 2017, repayments of HK$2.1 billion on
the senior revolving credit facility of the Wynn Macau Credit Facilities, a HK$1.5 billion repayment
of the WMLF Revolving Credit Facility and HK$550.9 million of interest payments, partially offset
by receipts of HK$1.0 billion proceeds from the senior revolving credit facility of the Wynn Macau
Credit Facilities. During the six months ended 30 June 2016, the net cash used in financing activities
was primarily due to a HK$3.1 billion special dividend payment made in April 2016, HK$221.1 million
of interest payments and a HK$124.0 million payment for land premiums, partially offset by receipts
of HK$1.2 billion proceeds from the senior revolving credit facility of the Wynn Macau Credit
Facilities.
Indebtedness
The following table presents a summary of our indebtedness.
Indebtedness information
As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
Bank loans 19,515,928 22,003,178
Senior notes 10,564,477 10,498,819
Less: debt financing costs, net (293,269) (332,109)
Total interest-bearing borrowings 29,787,136 32,169,888
27Interim Report 2017
Management Discussion and Analysis
Wynn Macau Credit Facilities
Overview
As at 30 June 2017, the Wynn Macau Credit Facilities consisted of approximately HK$23.8 billion
equivalent in a combination of Hong Kong dollar and U.S. dollar facilities, including an approximately
HK$18.0 billion equivalent fully funded senior term loan facility and an approximately HK$5.8 billion
equivalent senior revolving credit facility.
There is also an option to upsize the total senior secured credit facilities by approximately an
additional HK$7.8 billion equivalent (US$1.0 billion) under the Wynn Macau Credit Facilities and
related agreements upon the satisfaction of various conditions. The borrowings under the Wynn
Macau Credit Facilities were used to refinance WRM’s indebtedness in 2015 and for a variety of
purposes, including to fund the construction and development of Wynn Palace and for general
corporate purposes.
The HK$18.0 billion equivalent term loan facility is repayable in graduating installments of between
2.50% to 7.33% of the principal amount on a quarterly basis commencing December 2018, with a
final installment of 50% of the principal amount repayable in September 2021. The final maturity of
any outstanding borrowings from the revolving credit facility is September 2020, by which time any
outstanding borrowings from the revolving loans must be repaid.
The borrowings under the Wynn Macau Credit Facilities bear interest at LIBOR or HIBOR plus a
margin of 1.50% to 2.25% per annum based on WRM’s leverage ratio. Customary fees and expenses
were paid by WRM in connection with the Wynn Macau Credit Facilities.
Security and Guarantees
Borrowings under the Wynn Macau Credit Facilities are guaranteed by Palo and by certain
subsidiaries of the Company that own equity interests in WRM, and are secured by substantially all of
the assets of, and equity interests in WRM and Palo. With respect to the Concession Agreement and
WRM’s land concession agreement, the WRM lenders have certain cure rights and consultation rights
with the Macau government in the event of an enforcement action by the lenders.
28 Wynn Macau, Limited
Management Discussion and Analysis
Second Ranking Lender
WRM is also a party to a bank guarantee reimbursement agreement with Banco Nacional Ultramarino
S.A. to secure a guarantee in favor of the Macau government as required under the Concession
Agreement. The amount of this guarantee is MOP300 million (approximately HK$291.3 million) and
it lasts until 180 days after the end of the term of the Concession Agreement. The guarantee assures
WRM’s performance under the Concession Agreement, including the payment of certain premiums,
fines and indemnities for breach. The guarantee is secured by a second priority security interest in
the same collateral package securing the Wynn Macau Credit Facilities.
Other Terms
The Wynn Macau Credit Facilities contain representations, warranties, covenants and events of
default customary for casino development financings in Macau. The Directors confirm that there is
no non-compliance with the financial covenants or general covenants contained in the Wynn Macau
Credit Facilities.
The Company is not a party to the credit facilities agreement and related agreements and has no
rights or obligations thereunder.
The Group had approximately HK$4.3 billion available to draw under the revolving credit facility of
the Wynn Macau Credit Facilities as at 30 June 2017.
WML 2021 Notes
The Company issued 5.25% fixed rate unsecured senior notes due on 15 October 2021 with an
aggregate principal amount of US$1.35 billion (approximately HK$10.5 billion). The Company used
the net proceeds from the offering of the WML 2021 Notes for working capital requirements and
general corporate purposes. The WML 2021 Notes are listed on the Hong Kong Stock Exchange.
29Interim Report 2017
Management Discussion and Analysis
WMLF Revolving Credit Facility
On 18 July 2016, WMLF entered into an agreement as the borrower of a revolving credit facility for
initially up to HK$1.5 billion (approximately US$198.4 million) with Bank of China Limited, Macau
Branch as the lender.
Borrowings under the WMLF Revolving Credit Facility are secured by pledged US$ deposits of
initially up to US$200.0 million (approximately HK$1.6 billion) placed by WRL in a pledged account at
Bank of China Limited, Macau Branch.
Borrowings under the WMLF Revolving Credit Facility are used for working capital requirements and
general corporate purposes.
The final maturity of any outstanding borrowings under the WMLF Revolving Credit Facility is 18 July
2018, by which time any outstanding borrowings must be repaid in full.
The borrowings under the WMLF Revolving Credit Facility bear interest initially at 1.50% per annum,
such rate calculated as the interest rate paid by Bank of China Limited, Macau Branch to WRL in
respect of the US$ deposits in the pledged account at Bank of China Limited, Macau Branch plus
a margin of 0.40%. Under the terms of the agreement, mandatory repayment is required upon a
change in control or material adverse effect (as defined in the agreement).
On 25 October 2016, the WMLF Revolving Credit Facility was amended and upsized, increasing the
available borrowing capacity to HK$3.9 billion (approximately US$495.9 million). The terms of the
borrowing for the increased principal amount under the amendment are equivalent to the terms
of the original credit agreement, including the requirement for cash collateral to be deposited and
pledged with the lender, and interest is borne at the same rate as described above.
As at 30 June 2017, the Group had no outstanding amounts under the WMLF Revolving Credit
Facility and the full HK$3.9 billion available.
30 Wynn Macau, Limited
Management Discussion and Analysis
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Market risk is the risk of loss arising from adverse changes in market rates and conditions, such as
interest rates, and foreign currency exchange rates.
Foreign Currency Exchange Risks
The financial statements of foreign operations are translated into Hong Kong dollars, the Company’s
functional and presentation currency, for incorporation into the condensed consolidated financial
statements. The majority of our assets and liabilities are denominated in U.S. dollars, Hong Kong
dollars and Macau patacas, and there are no significant assets and liabilities denominated in other
currencies. Assets and liabilities are translated at the prevailing foreign exchange rates in effect at
the end of the reporting period. Income, expenditures and cash flow items are measured at the
actual foreign exchange rates or average foreign exchange rates for the period. The Hong Kong
dollar is linked to the U.S. dollar and the exchange rate between these two currencies has remained
relatively stable over the past several years. The Macau pataca is pegged to the Hong Kong dollar,
and in many cases the two currencies are used interchangeably in Macau. However, the exchange
linkages of the Hong Kong dollar and the Macau pataca, and the Hong Kong dollar and the U.S.
dollar, are subject to potential changes due to, among other things, changes in governmental
policies and international economic and political developments.
We attempt to manage exposure to foreign currency exchange risks associated with future
scheduled interest payments through the use of foreign currency forward contracts. These contracts
involve the exchange of one currency for a second currency at a future date and are with a counter-
party, which is a major international financial institution.
Interest Rate Risks
One of our primary exposures to market risk is interest rate risk associated with our credit facilities,
which bear interest based on floating rates. We attempt to manage interest rate risk by managing
the mix of long-term fixed rate borrowings and variable rate borrowings supplemented by hedging
activities as considered necessary. We cannot assure you that these risk management strategies will
have the desired effect, and interest rate fluctuations could have a negative impact on our results of
operations.
31Interim Report 2017
Management Discussion and Analysis
As at 30 June 2017, the Group had three interest rate swap agreements intended to manage a
portion of the underlying interest rate risk on borrowings under the Wynn Macau Credit Facilities.
Under two swap agreements, the Group pays a fixed interest rate of 0.73% on borrowings of
approximately HK$3.95 billion incurred under the Wynn Macau Credit Facilities in exchange for
receipts on the same amount at a variable interest rate based on the applicable HIBOR at the time of
payment. These interest rate swaps fixed the all-in interest rate on approximately HK$3.95 billion of
borrowings under the Wynn Macau Credit Facilities at 2.23% to 2.98% and expired in July 2017.
Under the third swap agreement, the Group pays a fixed interest rate of 0.6763% on borrowing of
US$243.8 million (approximately HK$1.9 billion) incurred under the Wynn Macau Credit Facilities in
exchange for receipts on the same amount at a variable interest rate based on the applicable LIBOR
at the time of payment. This interest rate swap fixed the all-in interest rate on US$243.8 million
(approximately HK$1.9 billion) of borrowings under the Wynn Macau Credit Facilities at 2.18% to
2.93% and expired in July 2017.
The carrying value of these interest rate swaps on the condensed consolidated statement of financial
position approximates its fair value. The fair value approximates the amount the Group would pay
or receive if these contracts were settled at the respective valuation dates. Fair value is estimated
based upon current, and predictions of future interest rate levels along a yield curve, the remaining
duration of the instruments and other market conditions and, therefore, is subject to significant
estimation and a high degree of variability of fluctuation between periods. We adjust this amount
by applying a non-performance valuation, considering our creditworthiness or the creditworthiness
of our counterparties at each settlement date, as applicable. These transactions do not qualify for
hedge accounting. Accordingly, changes in the fair values during the six months ended 30 June
2017 and 2016, were charged to the condensed consolidated statement of profit or loss and other
comprehensive income.
To the extent there are any liabilities of the Group under the swap agreement, such liabilities are
secured by the same collateral package securing the Wynn Macau Credit Facilities.
32 Wynn Macau, Limited
Management Discussion and Analysis
OFF BALANCE SHEET ARRANGEMENTS
We have not entered into any transactions with special purpose entities nor do we engage
in any transactions involving derivatives except for interest rate swaps and foreign currency
forward contracts. We do not have any retained or contingent interest in assets transferred to an
unconsolidated entity.
OTHER LIQUIDITY MATTERS
We expect to fund our operations and capital expenditure requirements from operating cash
flows, cash on hand and availability under our credit facilities. However, we cannot be sure that
operating cash flows will be sufficient for those purposes. We may refinance all or a portion of our
indebtedness on or before maturity. We cannot be sure that we will be able to refinance any of the
indebtedness on acceptable terms or at all.
New business developments or other unforeseen events may occur, resulting in the need to raise
additional funds. There can be no assurances regarding the business prospects with respect to any
other opportunity. Any other development would require us to obtain additional financing.
In the ordinary course of business, in response to market demands and client preferences, and in
order to increase revenues, we have made and will continue to make enhancements and refinements
to our resorts. We have incurred and will continue to incur capital expenditures related to these
enhancements and refinements.
Taking into consideration our financial resources, including our cash and cash equivalents, internally
generated funds and availability under our credit facilities, we believe that we have sufficient liquid
assets to meet our current and anticipated working capital and operating requirements.
RELATED PARTY TRANSACTIONS
For details of the related party transactions, see note 17 to the interim financial information. Our
Directors confirm that all related party transactions have been conducted on normal commercial
terms, and that their terms are fair and reasonable.
33Interim Report 2017
Directors and Senior Management
OUR DIRECTORS
The following table presents certain information in respect of the members of our Board.
Members of our Board
Name Age Position
Date of Appointment
as a Director
Stephen A. Wynn 75 Chairman of the Board,
Executive Director and
Chief Executive Officer
16 September 2009
Ian Michael Coughlan 58 Executive Director and
President
16 September 2009
Linda Chen 50 Executive Director and
Chief Operating Officer
16 September 2009
Matthew O. Maddox 41 Non-executive Director 28 March 2013
Kim Sinatra 57 Non-executive Director 1 April 2017
Allan Zeman, GBM, GBS, JP 69 Vice-chairman of the Board
and Independent
Non-executive Director
16 September 2009
Jeffrey Kin-fung Lam, GBS, JP 65 Independent Non-executive
Director
16 September 2009
Bruce Rockowitz 58 Independent Non-executive
Director
16 September 2009
Nicholas Sallnow-Smith 67 Independent Non-executive
Director
16 September 2009
34 Wynn Macau, Limited
Directors and Senior Management
The biography of each Director is set out below:
Executive Directors
Mr. Stephen A. Wynn, aged 75, has been a Director of the Company since its inception and
an executive Director, the Chairman of the Board of Directors and Chief Executive Officer of
the Company since 16 September 2009. Mr. Wynn was also the President of the Company from
September 2009 to January 2014. Mr. Wynn has served as Director, Chairman and Chief Executive
Officer of WRM since October 2001. Mr. Wynn has also served as Chairman and Chief Executive
Officer of Wynn Resorts, Limited since June 2002. Mr. Wynn has over 45 years of experience in the
gaming casino industry. Mr. Wynn also serves as an officer and/or director of several subsidiaries of
Wynn Resorts, Limited. During his time as Chairman, Chief Executive Officer and President of Mirage
Resorts, Mr. Wynn developed, opened and operated The Mirage, Treasure Island and Bellagio in
1989, 1993 and 1998, respectively. In 2011, Barron’s ranked Mr. Wynn as one of the world’s 30 best
CEOs. In February 2017, Mr. Wynn was named the Finance Chairman of the Republican National
Committee.
Mr. Ian Michael Coughlan, aged 58, has been the President of the Company since 30 September
2016 and an executive Director of the Company since 16 September 2009. Mr. Coughlan was
the President of WRM from July 2007 until March 2017 when he relinquished this role after his
appointment as President of the Company and the assumption of all responsibility for the Group.
Mr. Coughlan is responsible for the entire operation and development of both Wynn Macau and
Wynn Palace. Prior to these roles, Mr. Coughlan was Director of Hotel Operations — Worldwide for
Wynn Resorts, Limited. Mr. Coughlan has over 35 years of hospitality experience with leading hotels
across Asia, Europe and the United States. Before joining Wynn Resorts, Limited, he spent ten years
with The Peninsula Group, including posts as General Manager of The Peninsula Hong Kong from
September 2004 to January 2007, and General Manager of The Peninsula Bangkok from September
1999 to August 2004. His previous assignments include senior management positions at The Oriental
Singapore, and a number of Ritz-Carlton properties in the United States. Mr. Coughlan holds a
Diploma from Shannon College of Hotel Management, Ireland.
35Interim Report 2017
Directors and Senior Management
Ms. Linda Chen, aged 50, has been an executive Director and the Chief Operating Officer of
the Company since 16 September 2009, Chief Operating Officer of WRM since June 2002 and
President of WRM since March 2017. Ms. Chen is also the Executive Director of WRM. Ms. Chen is
responsible for the marketing and strategic development of WRM. Ms. Chen served as a director
of Wynn Resorts, Limited from October 2007 to December 2012 and is the President of WIML. In
these positions, she is responsible for the set-up of international marketing operations of Wynn
Resorts, Limited. Prior to joining the Group, Ms. Chen was Executive Vice President — International
Marketing at MGM Mirage, a role she held from June 2000 until May 2002, and was responsible
for the international marketing operations for MGM Grand, Bellagio and The Mirage. Prior to this
position, Ms. Chen served as the Executive Vice President of International Marketing for Bellagio and
was involved with its opening in 1998. She was also involved in the opening of the MGM Grand in
1993 and The Mirage in 1989. Ms. Chen is also a member of the Nanjing Committee of the Chinese
People’s Political Consultative Conference (Macau). Ms. Chen holds a Bachelor of Science Degree in
Hotel Administration from Cornell University in 1989 and completed the Stanford Graduate School
of Business Executive Development Program in 1997.
Non-executive Directors
Mr. Matthew O. Maddox, aged 41, has been a non-executive Director of the Company and a
member of the Remuneration Committee since 28 March 2013. Since November 2013, he has served
as the President of Wynn Resorts, Limited. From March 2008 to May 2014, Mr. Maddox was the
Chief Financial Officer of Wynn Resorts, Limited. Since joining Wynn Resorts in 2002, Mr. Maddox
has served as Wynn Resorts’ Senior Vice President of Business Development and Treasurer, as the
Senior Vice President of Business Development for Wynn Las Vegas, LLC, as the Chief Financial
Officer of WRM, and as Wynn Resorts’ Treasurer and Vice President-Investor Relations. Mr. Maddox
also serves as an officer of several subsidiaries of Wynn Resorts, Limited. Prior to joining Wynn
Resorts, Limited in 2002, Mr. Maddox worked in Corporate Finance for Caesars Entertainment, Inc.
(formerly Park Place Entertainment, Inc.). Before joining Park Place Entertainment, Mr. Maddox
worked as an investment banker for Bank of America Securities in the Mergers and Acquisitions
Department.
Ms. Kim Sinatra, aged 57, was appointed as a non-executive Director of the Company on 1 April
2017. Ms. Sinatra is the Executive Vice President, General Counsel and Secretary of Wynn Resorts,
Limited, a position she has held since February 2006. She joined Wynn Resorts, Limited in January
2004 as Senior Vice President and General Counsel of its development activities. She also serves as
an officer of several subsidiaries of Wynn Resorts, Limited. From 2000 to 2003, Ms. Sinatra served
as Executive Vice President and Chief Legal Officer of Caesars Entertainment, Inc. (formerly Park
Place Entertainment, Inc.). She has also served as General Counsel for The Griffin Group, Inc., Merv
Griffin’s investment management company, and as a partner in the New York office of the law firm
Gibson, Dunn & Crutcher LLP.
36 Wynn Macau, Limited
Directors and Senior Management
Independent non-executive Directors
Dr. Allan Zeman, GBM, GBS, JP, aged 69, has been a Director of the Company since its inception
and a non-executive Director of the Company since 16 September 2009 and is the Vice Chairman
of the Company. Effective from 29 March 2014, Dr. Zeman became an independent non-executive
Director of the Company. He was also a non-executive director of Wynn Resorts, Limited, from
October 2002 to December 2012. Dr. Zeman founded The Colby International Group in 1975 to
source and export fashion apparel to North America. In late 2000, The Colby International Group
merged with Li & Fung Limited. Dr. Zeman is the Chairman of Lan Kwai Fong Holdings Limited. He is
also the owner of Paradise Properties Group, a property developer in Thailand.
Dr. Zeman is the Vice Patron of Hong Kong Community Chest, and serves as a director of the “Star”
Ferry Company, Limited. Dr. Zeman also serves as an independent non-executive director of Pacific
Century Premium Developments Limited, Sino Land Company Limited, Tsim Sha Tsui Properties
Limited, Television Broadcasts Limited (TVB) and Global Brands Group Holding Limited, all of which
are listed on the Hong Kong Stock Exchange.
Having lived in Hong Kong for over 45 years, Dr. Zeman has been very involved in government
services as well as community activities. Besides having been the Chairman of Hong Kong Ocean
Park, a major theme park in Hong Kong, from July 2003 to June 2014 and is now a honorary advisor,
he is also a member of the General Committee of the Hong Kong General Chamber of Commerce
and Hong Kong China’s representative to the Asia-Pacific Economic Cooperation (APEC) Business
Advisory Council (“ABAC HK Members”). Dr. Zeman is a member of the board of Governors of
The Canadian Chamber of Commerce in Hong Kong. Dr. Zeman was a member of the Board of
West Kowloon Cultural District Authority, and the chairman of its Performing Arts Committee
from 2008 to 2016 and is now a honorary advisor. He is also the member of the Economic
Development Commission Working Group on Convention and Exhibition Industries and Tourism
of the Government of Hong Kong. In September 2014, Dr. Zeman was invited by former HKSAR
Chief Executive Mr. CH Tung to be a Special Advisor to his Our Hong Kong Foundation, which is
dedicated to promoting the long-term and overall interests of Hong Kong. In June 2015, Dr. Zeman
was appointed as a Board Member of the Airport Authority of Hong Kong. In November 2015, Dr.
Zeman was appointed to the board of directors of The Hong Kong Entrepreneurs Fund launched by
Alibaba Group.
In 2001, Dr. Zeman was appointed as a Justice of the Peace in Hong Kong. He was awarded the
Gold Bauhinia Star in 2004 and the Grand Bauhinia Medal in 2011. In 2008, Dr. Zeman was awarded
Business Person of the Year by the Hong Kong Business Award. In 2012, he was awarded Honorary
Doctorate Degrees of Business Administration from City University of Hong Kong and University of
Science and Technology of Hong Kong.
37Interim Report 2017
Directors and Senior Management
Mr. Jeffrey Kin-fung Lam, GBS, JP, aged 65, has been an independent non-executive Director
of the Company since 16 September 2009. Mr. Lam was appointed as a non-official member of
the Executive Council of Hong Kong in October 2012. Mr. Lam is also a member of the National
Committee of the Chinese People’s Political Consultative Conference and a member of the
Legislative Council of Hong Kong. He is the Chairman of the Independent Commission Against
Corruption (ICAC) Complaints Committee and Aviation Security Company Limited. He is also a
member of the board of Airport Authority Hong Kong and a member of the Fight Crime Committee
in Hong Kong. In April 2016, Mr. Lam was appointed as a director of the Hong Kong Mortgage
Corporation Limited (HKMC). Mr. Lam is also a General Committee Member of the Hong Kong
General Chamber of Commerce and the Vice-Chairman of The Hong Kong Shippers’ Council. In
addition, Mr. Lam is an independent non-executive director of CC Land Holdings Limited, China
Overseas Grand Oceans Group Limited, Chow Tai Fook Jewellery Group Limited and HNA Holding
Group Co. Limited (formerly known as HNA International Investment Holdings Limited), all of which
are listed on the Hong Kong Stock Exchange. He has served as the director on the board of Heifer
International — Hong Kong since January 2016. Mr. Lam was also an independent non-executive
director of Hsin Chong Construction Group Ltd. from August 2002 to May 2014 and Bracell Limited
(formerly known as Sateri Holdings Limited) until November 2016.
In 1996, Mr. Lam was appointed Justice of the Peace in Hong Kong and became a member of
the Most Excellent Order of the British Empire. He was awarded the honor of the Gold Bauhinia
Star in July 2011 and the Silver Bauhinia Star in 2004. Mr. Lam was conferred University Fellow of
Tufts University in the United States and Hong Kong Polytechnic University in 1997 and in 2000,
respectively.
38 Wynn Macau, Limited
Directors and Senior Management
Mr. Bruce Rockowitz, aged 58, has been an independent non-executive Director of the Company
since 16 September 2009. Mr. Rockowitz has been appointed as the Chief Executive Officer, Vice
Chairman and Executive Director of Global Brands Group Holding Limited, a company spun off from
Li & Fung Limited and listed on the Hong Kong Stock Exchange in July 2014. Mr. Rockowitz joined
Li & Fung Limited as Executive Director in 2001 until June 2014. He was the President of the Li &
Fung Group from 2004 to 2011, and Group President and Chief Executive Officer from 2011 to June
2014. He was also the co-founder and Chief Executive Officer of Colby International Limited, a large
Hong Kong buying agent, prior to its acquisition by Li & Fung in 2000. In addition to his positions at
Li & Fung and Global Brands Group, Mr. Rockowitz is the non-executive director of The Pure Group,
a lifestyle, fitness and yoga group operating in Hong Kong, Singapore, Taiwan and mainland China.
He is a member of the Advisory Board for the Wharton School’s Jay H Baker Retailing Center, an
industry research center for retail at the University of Pennsylvania. He is also a board member of
the Education Foundation for Fashion Industries, the private fund-raising arm of the Fashion Institute
of Technology, New York. In March 2012, he became a member of the Global Advisory Council
of the Women’s Tennis Association (WTA). In 2008, Mr. Rockowitz was ranked first by Institutional
Investor for Asia’s Best CEOs in the consumer category. In the years 2010 and 2011, he was also
ranked as one of the world’s 30 best CEOs by Barron’s. In 2011, he was presented with the Alumni
Achievement Award by the University of Vermont. In the years 2012 and 2017, Mr. Rockowitz was
named Asia’s Best CEO at Corporate Governance Asia’s Excellence Recognition Awards, and he was
also presented with an Asian Corporate Director Recognition Award by the same organization in
2012 and 2013.
Mr. Nicholas Sallnow-Smith, aged 67, has been an independent non-executive Director of
the Company since 16 September 2009. Mr. Sallnow-Smith also served as the Chairman and
an independent non-executive director of Link Asset Management Limited (formerly The Link
Management Limited) between April 2007 and March 2016, when he also served as Chairman of
Link Asset Management Limited’s Finance and Investment, and Nominations Committees. Link Asset
Management Limited is the manager to Link Real Estate Investment Trust (formerly The Link Real
Estate Investment Trust), which is listed on the Hong Kong Stock Exchange. Mr. Sallnow-Smith is also
a non-executive director of UCP Plc, which was listed on the London Stock Exchange. Prior to joining
Link, Mr. Sallnow-Smith was Chief Executive of Hongkong Land Holdings Limited from February 2000
to March 2007. He has a wide ranging finance background in Asia and the United Kingdom for over
30 years, including his roles as Finance Director of Hongkong Land Holdings Limited from 1998 to
2000 and as Group Treasurer of Jardine Matheson Limited from 1993 to 1998.
39Interim Report 2017
Directors and Senior Management
Mr. Sallnow-Smith’s early career was spent in the British Civil Service, where he worked for Her
Majesty’s Treasury in Whitehall, London from 1975 to 1985. During that time, he was seconded
for two years to Manufacturers Hanover London, working in export finance and in their merchant
banking division, Manufacturers Hanover Limited. He left the Civil Service in 1985, following a period
working in the International Finance section of H. M. Treasury on Paris Club and other international
debt policy matters, and spent two years with Lloyds Merchant Bank before moving into the
corporate sector in 1987. Mr. Sallnow-Smith served as the Convenor of the Hong Kong Association
of Corporate Treasurers from 1996 to 2000, as Chairman of the Matilda Child Development Centre
in 1994 and 1995 and as Chairman of the Matilda International Hospital from 2003 to 2005.
He is an Executive Committee member of the Hong Kong Youth Arts Foundation, a member of
the Council of the Treasury Markets Association (Hong Kong Association of Corporate Treasurers
Representative), and a member of the Board of Governors of Hong Kong Philharmonic Society Ltd.
He was the Chairman of Manpower Committee of the Hong Kong General Chamber of Commerce
from 2014 to 2016. He was previously the Chairman of the General Committee of The British
Chamber of Commerce in Hong Kong from 2012 to 2014. He is also a director of The East Asian
History of Science Foundation, and a Councillor of the Foundation for the Arts and Music in Asia
Limited. He has been a member of the Financial Reporting Council of Hong Kong since December
2012. Mr. Sallnow-Smith was educated at Gonville & Caius College, Cambridge, and the University
of Leicester and is a Fellow of the Association of Corporate Treasurers. He holds M.A. (Cantab) and
M.A. (Soc. of Ed.) Degrees.
OUR SENIOR MANAGEMENT
The following table presents certain information concerning the senior management personnel of the
Group (other than our Executive Directors).
Wynn Resorts (Macau) S.A.
Name Age Position
Frank Xiao 49 President — Marketing
Jay M. Schall 44 Senior Vice President and General Counsel#,
Senior Vice President — Legal
40 Wynn Macau, Limited
Directors and Senior Management
Wynn Macau
Name Age Position
Ciarán Pearse Carruthers 48 Chief Operating Officer
Frank Anthony Cassella 40 Senior Vice President — Chief Financial Officer
Mao Ling Yeung 45 Senior Vice President — Human Resources
Elizabeth Doherty 58 Assistant Vice President — Casino Operations
Craig Arthur Raymond
Mitchell
56 Assistant Vice President — Slot Operations
Elsie Guerrero 61 Assistant Vice President — Wynn Club Gaming
Rory McGregor Forbes 47 Executive Director — Security Operations
Wynn Palace
Name Age Position
Frederic Jean-Luc Luvisutto 45 Chief Operating Officer
Robert Alexander Gansmo 47 Senior Vice President — Chief Financial Officer
Michael Francis Clifford 54 Senior Vice President — Casino Operations
Kristoffer Luczak 48 Senior Vice President — Food & Beverage
Mo Yin Mok 56 Senior Vice President — Human Resources#
Dianne Fiona Dennehy 61 Senior Vice President — Main Floor Gaming
Peter James Barnes 58 Senior Vice President — Security & Corporate
Investigation
Dennis Hudson 57 Vice President — Wynn Club Gaming
Notes:
# Position held in the Company.
41Interim Report 2017
Directors and Senior Management
The biography of each member of the senior management team (other than our executive Directors)
is set out below:
Wynn Resorts (Macau) S.A.
Mr. Frank Xiao, aged 49, is the President — Marketing of WRM, a position he has held since
October 2012. Prior to this position, Mr. Xiao was the Senior Executive Vice President — Premier
Marketing between August 2006 and October 2012. Mr. Xiao is responsible for providing leadership
and guidance to the marketing team and staff, developing business for and promoting Wynn Macau.
Prior to this position, Mr. Xiao was the Senior Executive Vice President — China Marketing for WIML
and Worldwide Wynn between 2005 until 2006. Prior to joining the Group, Mr. Xiao was the Senior
Vice President of Far East Marketing at MGM Grand Hotel. During his 12 years at the MGM Grand
Hotel, he was promoted several times from his first position as Far East Marketing Executive in 1993.
Mr. Xiao holds a Bachelor of Science Degree in Hotel Administration and a Master’s Degree in Hotel
Administration from the University of Nevada, Las Vegas.
Mr. Jay M. Schall, aged 44, is the Senior Vice President and General Counsel of the Company and
Senior Vice President — Legal of WRM. He has held senior legal positions with WRM since May
2006. Mr. Schall has over 17 years of experience in the legal field, including over 13 years in Macau
and Hong Kong. Prior to joining the Group, Mr. Schall practiced United States law at a major law firm
in the United States and in Hong Kong. Mr. Schall is a member of the State Bar of Texas. Mr. Schall
holds a Bachelor of Arts Degree from Colorado College, an MBA from Tulane University, Freeman
School of Business and a Juris Doctor (magna cum laude, Order of the Coif) from Tulane University
School of Law.
Wynn Macau
Mr. Ciarán Pearse Carruthers, aged 48, is the Wynn Macau Chief Operating Officer, a position he
has held since January 2017. Mr. Carruthers is responsible for overseeing all operations at Wynn
Macau, including gaming operations. Prior to this position, Mr. Carruthers was the Senior Vice
President and Director of the Venetian and Plaza Operations for Sands China Ltd.. Mr. Carruthers
has been in the gaming industry for 30 years and in the Asia Pacific region since 1991 and Macau
since 2002. Among others, Mr. Carruthers held positions as President & CEO of Asia Pacific Gaming
and Chief Operating Officer of StarWorld Hotel & Casino and SVP Operations for the City Clubs at
Galaxy Entertainment Group Limited. He has also held a number of senior operational roles at casino
resorts in South East Asia, the Philippines and the US Pacific Islands.
42 Wynn Macau, Limited
Directors and Senior Management
Mr. Frank Anthony Cassella, aged 40, is the Wynn Macau Senior Vice President — Chief Financial
Officer, a position he has held since January 2014. Mr. Cassella is responsible for the management
and administration of Wynn Macau finance division. Prior to this position, Mr. Cassella worked at
Wynn Resorts, Limited since 2006, most recently as the Executive-Director of Financial Reporting.
Prior to joining Wynn Resorts, Limited, Mr. Cassella practiced as a certified public accountant with
firms in Las Vegas and New York, including PricewaterhouseCoopers and KPMG. Mr. Cassella
graduated from the Pennsylvania State University, where he obtained a Bachelor of Science Degree
in Accounting.
Ms. Mao Ling Yeung, aged 45, is the Wynn Macau Senior Vice President — Human Resources, a
position she has held since January 2017. Prior to this position, Ms. Yeung was the Wynn Palace
Senior Vice President — Human Resources from June 2015 to December 2016. Ms. Yeung has over
20 years of all-round human resources and organization development experience in various sectors
including hospitality, luxury retail, and property within the Asia Pacific region. Prior to joining the
Group, Ms. Yeung was the Regional Director of Human Resources at SSP Asia Pacific Limited,
and before that, she had also held various strategic human resources leadership positions in such
multinational organizations as Swire Properties Limited, Swire Hotels, Louis Vuitton Asia Pacific, Four
Seasons and Shangri-La.
Ms. Yeung holds a Bachelor’s Degree in Hospitality Management and a Master’s Degree in Business
Administration. She is also an alumni of the Advanced Management Program from INSEAD,
Fontainebleau.
Ms. Elizabeth Doherty, aged 58, is the Wynn Macau Assistant Vice President — Casino Operations,
a position she has held since August 2016. Ms. Doherty is responsible for leading and overseeing the
Main Floor Gaming operations. Prior to this position, she was Director of Workforce Administration
at Wynn Macau from November 2007 to December 2014. She joined Wynn Macau pre-opening as
a Casino Manager in June 2006. Before joining Wynn Macau, Ms. Doherty held a variety of gaming
and service leadership roles in Australasia and Europe. She has over 25 years of experience in
the gaming and services industry covering a broad spectrum of responsibilities including gaming
operations, training and development, along with project management, safety and security.
43Interim Report 2017
Directors and Senior Management
Mr. Craig Arthur Raymond Mitchell, aged 56, is the Wynn Macau Assistant Vice President —
Slot Operations, a position he has held since June 2011. Mr. Mitchell is responsible for providing
leadership and guidance to the slot department management team and staff. This includes
establishing the operational structure, instituting departmental policies and procedures, developing
slot merchandising strategies, and projecting and evaluating the revenues and expenses of the
department. Prior to this position, Mr. Mitchell was the Director — Slot Operations between June
2008 and May 2011 and a Shift Manager of Slots between June 2006 and May 2008. Mr. Mitchell
held management roles in various hospitality-related businesses prior to joining the Group including
Gaming Manager at a Rugby Super League Club in Sydney which had 300 slot machines. From
1989, he was Operations Manager and Duty Manager at Balmain Leagues Club (Tigers), Australia.
Mr. Mitchell has attended the Gaming Executive Development Program at the University of Nevada,
United States.
Ms. Elsie Guerrero, aged 61, is the Wynn Macau Assistant Vice President — Wynn Club Gaming,
a position she has held since July 2015. Ms. Guerrero is responsible for overseeing Wynn Club
Gaming operations, expansion projects, staffing and training, budgeting and business operation
for Wynn Macau. Prior to this position, she was the Casino Manager at Wynn Las Vegas from April
2008 to June 2015. Ms. Guerrero started her gaming career as a Dealer at the former MGM Grand
Hotel (now Bally’s) in Las Vegas in 1980, and has amassed over 35 years of experience in the casino
industry. Prior to joining Wynn Las Vegas, she held the position as a Baccarat Manager at Caesar
Palace Las Vegas from April 2000 to June 2007 and was part of the pre-opening team in MGM
Grand Macau as a Casino Shift Manager from July 2007 to March 2008.
Mr. Rory McGregor Forbes, aged 47, is the Wynn Macau Executive Director — Security Operations,
a position he has held since 10 July 2014. Mr. Forbes is responsible for all aspects of Wynn Macau’s
security. Prior to joining the Group, Mr. Forbes served in the Royal Hong Kong Police Force, where
he enjoyed a decorated 13-year career, rising to the rank of Senior Inspector. He then spent four and
a half years with The HALO Trust which specializes in mine clearance and destruction of explosive
ordnance in conflict zones. Immediately prior to joining Wynn Macau, Mr. Forbes was Associate
Director of Security at Venetian Macau. Mr. Forbes speaks five languages and has professional
experience in executive and VIP security, crowd management and public order control. Mr. Forbes
holds a Bachelor Degree in Modern Chinese and Business Studies and a Master of Science Degree
in Public Policy and Management. Mr. Forbes also completed the Public Security Bureau University
course in Beijing, China and the Senior Police Administration Course in Ottawa, Canada.
44 Wynn Macau, Limited
Directors and Senior Management
Wynn Palace
Mr. Frederic Jean-Luc Luvisutto, aged 45, is the Wynn Palace Chief Operating Officer, a position
he has held since January 2014. Mr. Luvisutto is responsible for overseeing all operations at Wynn
Palace. Prior to this position, Mr. Luvisutto was the Managing Director of the Star Resort and Casino
in Sydney, Australia. Before this he was the Managing Director of Jupiters Resort and Casino, Gold
Coast, Australia. Mr. Luvisutto’s hospitality and gaming career spans over 20 years and also includes
appointments as Vice President of The Signature at MGM Grand in Las Vegas and Vice President —
Hotel Operations at Monte Carlo Resort and Casino in Las Vegas. Mr. Luvisutto graduated from the
Lausanne Hotel Management School, Switzerland.
Mr. Robert Alexander Gansmo, aged 47, is the Wynn Palace Senior Vice President — Chief
Financial Officer, a position he has held since January 2014. Prior to this position, Mr. Gansmo was
the Senior Vice President — Chief Financial Officer of Wynn Macau from April 2009 to January 2014,
and the Director — Finance of Wynn Macau, a position he assumed in January 2007. Mr. Gansmo is
responsible for the management and administration of Wynn Palace’s finance division. Before joining
WRM, Mr. Gansmo worked at Wynn Resorts, Limited, where he served as the Director of Financial
Reporting from November 2002. Prior to joining the Wynn Resorts, Limited, Mr. Gansmo practiced
as a certified public accountant with firms in Las Vegas, Washington and California, including KPMG
Peat Marwick, Arthur Andersen, and Deloitte and Touche. Mr. Gansmo graduated in 1993 from
California State University, Chico, where he obtained a Bachelor of Science Degree in Business
Administration with a focus on accounting.
Mr. Michael Francis Clifford, aged 54, is the Wynn Palace Senior Vice President — Casino
Operations. Mr. Clifford is responsible for providing leadership and operational direction for
Wynn Palace gaming operations. Mr. Clifford has nearly 25 years of experience in the gaming
industry. Over his career, Mr. Clifford has gained experience in a wide range of assignments from
International Marketing to Table Games, being steadily promoted into a variety of leadership
positions in baccarat and main floor operations. Prior to his position, Mr. Clifford held the position
of Vice President of Table Games at MGM Macau, managing 427 tables and 2,500 employees. Prior
to moving to Macau, Mr. Clifford was Vice President of International Marketing at MGM Resorts
International.
45Interim Report 2017
Directors and Senior Management
Mr. Kristoffer Luczak, aged 48, is the Senior Vice President — Food & Beverage. Mr. Luczak is
responsible for overseeing the food and beverage division at Wynn Palace and providing group
management oversight of Wynn Macau including all projects related to food and beverage concepts,
design, products and service. Prior to joining the Group, Mr. Luczak was the Senior Vice President of
Food & Beverage of Melco Resorts & Entertainment Limited (formerly Melco Crown Entertainment
Limited) where he served for more than a decade, overseeing all food and beverage strategy and
directing food and beverage operations at their three integrated resorts in Macau (City of Dreams,
Studio City and Altira). Mr. Luczak’s hospitality career spans 30 years, the last 20 of which he has
spent in senior operations roles throughout Asia, including Raffles Hotel Singapore, The Peninsula
Bangkok and The Oberoi, Bali.
Ms. Mo Yin Mok, aged 56, is the Senior Vice President — Human Resources of the Company, a
position she has held since January 2017. Ms. Mok is responsible for overseeing and leading the
human resources function of the Company. She joined Wynn Macau in June 2008 as Vice President
— Human Resources and was promoted as Wynn Macau Senior Vice President — Human Resources
in June 2014. Ms. Mok has an extensive 20-year background in hospitality and human resources,
primarily in the luxury hotel sector at The Regent Four Seasons Hong Kong and The Peninsula Hong
Kong. Prior to joining the Group, she led The Peninsula Group’s worldwide human resources team
and, in her position, supported eight Peninsula hotels with more than 5,000 staff, and orchestrated
human resources activities for the opening of The Peninsula Tokyo. Ms. Mok also served at the front
lines of the hospitality industry as the Director of Rooms Division at The Peninsula Hong Kong with
responsibility for front office, housekeeping, security and spa departments. Ms. Mok currently serves
on the Future Studies and Placement Advisory Committee and the Centre for Continuing Education
Advisory Board of the University of Macau and is a panel member of the Hong Kong Council for
Accreditation of Academic and Vocational Qualifications.
Ms. Mok holds a Bachelor of Science Degree in Hospitality Management from Florida International
University in the United States, where she received a Rotary International Ambassadorial Scholarship.
She also obtained an MBA from the Chinese University of Hong Kong.
46 Wynn Macau, Limited
Directors and Senior Management
Ms. Dianne Fiona Dennehy, aged 61, is the Wynn Palace Senior Vice President — Main Floor
Gaming, a position she has held since January 2015. Ms. Dennehy is responsible for leading and
overseeing Wynn Palace’s Main Floor Gaming division. Prior to this position, she was the Vice
President — Main Floor Gaming from September 2011 to December 2014, from September 2010 to
August 2011 she was the Assistant Vice President — Main Floor Gaming, and from September 2005
through August 2010 she was the Director — Main Floor Gaming. Ms. Dennehy was responsible
for the overall operations of Wynn Macau main floor table games operation. Ms. Dennehy has
over 40 years of experience in the casino industry and has experience in such areas as table games
operations, card room operations, cash desk, slots, VIP, guest relations, human resources, and
training and development. Prior to joining the Group, Ms. Dennehy was involved in the opening of
a number of casino properties in Australia, and has also opened properties in Sri Lanka, Yugoslavia
and Egypt. She also has six years of experience in human resources, which she gained as the Human
Resources Operations Manager at Star City, Sydney, Australia.
Mr. Peter James Barnes, aged 58, is the Wynn Palace Senior Vice President — Security and
Corporate Investigation, a position he has held since May 2015. Mr. Barnes is responsible for all
aspects of security and corporate investigations. Mr. Barnes also served as Executive Director —
Security & Corporate Investigations of WRM between July 2008 and June 2012. Between July 2012
and April 2015, Mr. Barnes was Vice President Corporate Security at Galaxy Entertainment Group
Limited. Mr. Barnes has 30 years of experience in the Hong Kong Police Force and has held various
managerial positions involving serious crimes, homicide, organized crime and anti-riot operations.
Mr. Barnes’ experience includes serving as the Divisional Commander in charge of uniformed and
criminal investigation department officers in Tsimshatsui, Hong Kong, a position he held from 2004
until 2005 when he was promoted to the rank of Detective Senior Superintendent of Police in the
Kowloon East region. Mr. Barnes has professional qualifications which cover security design, financial
investigations, intermediate and senior command, criminal intelligence and surveillance operations.
Mr. Barnes completed the 205th Session of the Federal Bureau of Investigation’s National Academy
Program in Quantico, Virginia, United States. Mr. Barnes was awarded the Commanding Officer’s
Commendations in 1983 and 1997.
47Interim Report 2017
Directors and Senior Management
Mr. Dennis Hudson, aged 57, is the Wynn Palace Vice President — Wynn Club Gaming, a
position he has held since July 2015. Mr. Hudson is responsible for overseeing Wynn Club Gaming
operations, expansion projects, staffing and training, budgeting and business operation for Wynn
Palace. Prior to this position, he was Wynn Macau Vice President — Wynn Club Gaming from April
2012 to June 2015 and he was a Shift Manager — Wynn Club from joining Wynn Macau in April 2006
through March 2012. Mr. Hudson started his gaming career at the Playboy Victoria Sporting Club
on Edgware Road in London in 1979, and has amassed over 35 years of experience in the casino
industry, including senior management positions. Among others, he was a Casino Manager for Star
Cruises, where he was responsible for shipboard casino operations on cruises throughout Asia from
2000 to April 2006 and he was the Director of Gaming for VIP Clubs in the Czech Republic from 1995
to 2000.
OUR COMPANY SECRETARY
Ms. Ho Wing Tsz, Wendy, aged 47, has been appointed as the company secretary of the Company
with effect from 28 February 2013. She is a Director of Corporate Services Division at Tricor Services
Limited, a global professional service provider specialized in integrated business, corporate and
investor services. Ms. Ho is a Chartered Secretary and a Fellow of both The Hong Kong Institute of
Chartered Secretaries (“HKICS”) and The Institute of Chartered Secretaries and Administrators in the
United Kingdom. She has over 20 years of experience in a diversified range of corporate services
and has been providing professional secretarial services to a number of listed companies, a real
estate investment trust listed on the Hong Kong Stock Exchange as well as multinational, private and
offshore companies. She is a holder of the Practitioner’s Endorsement from HKICS.
48 Wynn Macau, Limited
Other Information
DIVIDENDS
On 17 August 2017, the Board resolved to declare an interim dividend of HK$0.21 per Share to be
paid in respect of the six months ended 30 June 2017.
DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN THE
SHARES, UNDERLYING SHARES AND DEBENTURES OF THE COMPANY AND ANY
ASSOCIATED CORPORATION
As at 30 June 2017, the interests and short positions of each Director and the chief executive of
the Company (being Mr. Stephen A. Wynn) in the Shares, underlying Shares and debentures of
the Company or any of its associated corporations within the meaning of Part XV of the SFO which
(a) were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to
Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which the Director
or chief executive is taken or deemed to have under such provisions of the SFO); (b) were required,
pursuant to section 352 of the SFO, to be entered in the register maintained by the Company
referred to therein; (c) were required, pursuant to the Model Code contained in the Listing Rules, to
be notified to the Company and the Hong Kong Stock Exchange; or (d) were disclosed according to
the knowledge of the Directors of the Company were as follows:
(a) Interests in the Company
Name of Director
Personal
Interest
Family
Interest
Corporate
Interest
Other
Interest
Total
Number
of Shares
Approximate
Percentage of
Shareholding
Allan Zeman 2,003,000
(Long Position)
(Note 1)
— — — 2,003,000
(Long Position)
(Note 1)
—
Nicholas Sallnow-Smith — 10,000
(Long Position)
(Note 2)
— 276,000
(Long Position)
(Note 2)
286,000
(Long Position)
(Note 2)
0.01%
1,727,000
(Long Position)
(Note 2)
— — — 1,727,000
(Long Position)
(Note 2)
—
Bruce Rockowitz 238,000
(Long Position)
(Note 3)
— — — 238,000
(Long Position)
(Note 3)
0.00%
1,765,000
(Long Position)
(Note 3)
— — — 1,765,000
(Long Position)
(Note 3)
—
49Interim Report 2017
Other Information
Name of Director
Personal
Interest
Family
Interest
Corporate
Interest
Other
Interest
Total
Number
of Shares
Approximate
Percentage of
Shareholding
Jeffrey Kin-fung Lam 2,003,000
(Long Position)
(Note 4)
— — — 2,003,000
(Long Position)
(Note 4)
—
Notes:
(1) Pursuant to the Company’s share option scheme, Dr. Allan Zeman holds share options for 2,003,000 Shares, of
which share options for 1,020,000 Shares are exercisable as at 17 August 2017.
(2) Mr. Nicholas Sallnow-Smith is deemed to hold 276,000 Shares jointly with his spouse, Ms. Lora Sallnow-Smith.
Ms. Lora Sallnow-Smith was interested in 10,000 Shares. Mr. Sallnow-Smith is deemed to be interested in the
10,000 Shares held by his spouse under the SFO. Pursuant to the Company’s share option scheme, Mr. Sallnow-
Smith holds share options for 1,727,000 Shares, of which share options for 744,000 Shares are exercisable as at
17 August 2017.
(3) Mr. Bruce Rockowitz holds 238,000 Shares in his personal capacity. Pursuant to the Company’s share option
scheme, Mr. Rockowitz holds share options for 1,765,000 Shares, of which share options for 782,000 Shares are
exercisable as at 17 August 2017.
(4) Pursuant to the Company’s share option scheme, Mr. Jeffrey Kin-fung Lam holds share options for 2,003,000
Shares, of which share options for 1,020,000 Shares are exercisable as at 17 August 2017.
(b) Interests in associated corporations — Wynn Resorts, Limited
Name of Director
Personal
Interest
Family
Interest
Corporate
Interest
Other
Interest
Total
Number
of Shares
Approximate
Percentage of
Shareholding
Stephen A. Wynn — 10,500
(Long Position)
(Note 1)
— 12,079,800
(Long Position)
(Note 1)
12,090,300
(Long Position)
(Note 1)
11.79%
Ian Michael Coughlan 91,448
(Long Position)
(Note 2)
— — — 91,448
(Long Position)
(Note 2)
0.09%
Linda Chen 56,203
(Long Position)
(Note 3)
— — — 56,203
(Long Position)
(Note 3)
0.05%
244,172
(Long Position)
(Note 3)
— — — 244,172
(Long Position)
(Note 3)
—
DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN THE
SHARES, UNDERLYING SHARES AND DEBENTURES OF THE COMPANY AND ANY
ASSOCIATED CORPORATION (CONTINUED)
(a) Interests in the Company (Continued)
50 Wynn Macau, Limited
Other Information
Name of Director
Personal
Interest
Family
Interest
Corporate
Interest
Other
Interest
Total
Number
of Shares
Approximate
Percentage of
Shareholding
Matthew O. Maddox 300,586
(Long Position)
(Note 4)
— — — 300,586
(Long Position)
(Note 4)
0.29%
215,000
(Long Position)
(Note 4)
— — — 215,000
(Long Position)
(Note 4)
—
Kim Sinatra 198,443
(Long Position)
(Note 5)
— — — 198,443
(Long Position)
(Note 5)
0.19%
125,000
(Long Position)
(Note 5)
— — — 125,000
(Long Position)
(Note 5)
—
Notes:
(1) Mr. Stephen A. Wynn is deemed interested in 12,079,800 shares in the common stock of Wynn Resorts, Limited
(“WRL Shares”) held by Wynn Family Limited Partnership (Delaware, U.S.A.). Mr. Wynn, in his capacity as trustee
of the Stephen A. Wynn Revocable Trust U/D/T dated 24 June 2010, is the sole manager of Wynn GP, LLC
(Delaware, U.S.A.), which is the general partner of Wynn Family Limited Partnership. Mr. Wynn’s spouse was
interested in 10,500 WRL Shares. Mr. Wynn has disclaimed his interest in these shares but is deemed to be
interested in them under the SFO.
(2) Mr. Ian Michael Coughlan held (i) 41,448 WRL Shares; and (ii) 50,000 non-vested WRL Shares.
(3) Ms. Linda Chen held (i) 56,203 WRL Shares; and (ii) 244,172 stock options for WRL Shares, of which share options
for 184,172 WRL Shares are exercisable.
(4) Mr. Matthew O. Maddox held (i) 100,586 WRL Shares; (ii) 200,000 non-vested WRL Shares; and (iii) 215,000 stock
options for WRL Shares of which share options for 155,000 WRL Shares are exercisable.
(5) Ms. Kim Sinatra held (i) 98,443 WRL Shares; (ii) 100,000 non-vested WRL shares; and (iii) 125,000 stock options
for WRL Shares, of which share options for 75,000 WRL Shares are exercisable.
DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN THE
SHARES, UNDERLYING SHARES AND DEBENTURES OF THE COMPANY AND ANY
ASSOCIATED CORPORATION (CONTINUED)
(b) Interests in associated corporations — Wynn Resorts, Limited (Continued)
51Interim Report 2017
Other Information
SUBSTANTIAL SHAREHOLDERS’ INTERESTS AND SHORT POSITIONS IN THE SHARES
AND UNDERLYING SHARES OF THE COMPANY
As at 30 June 2017, the Company had been notified of the following substantial shareholders’
interests and short positions in the Shares and underlying Shares of the Company, which have been
recorded in the register of substantial shareholders required to be kept by the Company pursuant to
section 336 of Part XV of the SFO. These interests are in addition to those disclosed above in respect
of the Directors and chief executive of the Company.
Shares of HK$0.001 each in the Company
Name
Capacity/Nature of
Interest
Number of
Shares
Percentage of
the issued share
capital of the
Company
WM Cayman Holdings Limited I
(Note 1)
Beneficial interest 3,750,000,000
(Long Position)
72.18%
Wynn Group Asia, Inc. (Note 1) Interest of a controlled
corporation
3,750,000,000
(Long Position)
72.18%
Wynn Resorts, Limited (Note 1) Interest of a controlled
corporation
3,750,000,000
(Long Position)
72.18%
The Capital Group Companies, Inc.
(Note 2)
Interest of a controlled
corporation
259,863,447
(Long Position)
5.00%
Notes:
(1) WM Cayman Holdings Limited I is a wholly-owned subsidiary of Wynn Group Asia, Inc., which in turn is wholly-
owned by Wynn Resorts, Limited. Therefore, Wynn Group Asia, Inc. and Wynn Resorts, Limited are deemed or
taken to be interested in 3,750,000,000 Shares which are beneficially owned by WM Cayman Holdings Limited I.
(2) The Capital Group Companies, Inc. is deemed to be interested in 259,863,447 Shares, comprised of (i)
154,610,039 Shares held by a wholly-owned subsidiary, Capital Research and Management Company, and (ii)
105,253,408 Shares through Capital Group International, Inc., a wholly-owned subsidiary of Capital Research
and Management Company, which is deemed interested in 33,760,008 Shares held by Capital Guardian Trust
Company, 40,568,300 Shares held by Capital International, Inc., 8,917,700 Shares held by Capital International
Limited and 22,007,400 Shares held by Capital International Sarl, each being a wholly-owned subsidiary of
Capital Group International, Inc..
52 Wynn Macau, Limited
Other Information
SUBSTANTIAL SHAREHOLDERS’ INTERESTS AND SHORT POSITIONS IN THE SHARES
AND UNDERLYING SHARES OF THE COMPANY (CONTINUED)
Save as disclosed above, according to the register kept by the Company under Section 336 of the
SFO, there was no other person who had a substantial interest or short positions in the Shares or
underlying Shares of the Company as at 30 June 2017.
REMUNERATION POLICY
As at 30 June 2017, the Group had approximately 11,800 full-time equivalent employees. Employees
of the Group are selected, remunerated and promoted on the basis of their merit, qualifications,
competence and contribution to the Group.
Compensation of key executives of the Group is determined by the Company’s remuneration
committee which reviews and determines executives’ compensation based on the Group’s
performance and the executives’ respective contributions to the Group.
The Company also has a provident fund set up for its employees, an employee ownership scheme
and a share option scheme. Further details on the Company’s employee ownership scheme and
share option scheme are set out below.
EMPLOYEE OWNERSHIP SCHEME
The Company operates an employee ownership scheme as adopted on 30 June 2014. The following
table discloses movements in the non-vested Shares outstanding during the period ended 30 June
2017.
Number of
Shares
Weighted
Average
Grant Date
Fair Value
(HK$)
Non-vested as at 1 January 2017 14,009,134 20.21
Granted during the period 1,751,097 15.31
Forfeited during the period (781,752) 16.09
Vested during the period (3,140,000) 29.80
Non-vested as at 30 June 2017 11,838,479 17.22
53Interim Report 2017
Other Information
SHARE OPTION SCHEME
The Company operates a share option scheme. The following table discloses movements in the
Company’s share options outstanding during the period ended 30 June 2017.
Number of share options
Name of Director
Date of
grant of
share
options(1)
At
1 January
2017
Granted
during the
period(2)
Exercised
during the
period
Expired/
lapsed/
canceled
during the
period
At
30 June
2017
Exercise period
of share options
Exercise
price of
share
options
per Share
(HK$)
Dr. Allan Zeman 25 March 2010 250,000 — — — 250,000 25 March 2011 to
24 March 2020
10.92
17 May 2011 100,000 — — — 100,000 17 May 2012 to
16 May 2021
25.96
5 June 2012 190,000 — — — 190,000 5 June 2013 to
4 June 2022
19.04
16 May 2013 200,000 — — — 200,000 16 May 2014 to
15 May 2023
24.87
15 May 2014 161,000 — — — 161,000 15 May 2015 to
14 May 2024
31.05
21 May 2015 317,000 — — — 317,000 21 May 2016 to
20 May 2025
15.46
25 May 2016 483,000 — — — 483,000 25 May 2017 to
24 May 2026
11.58
1 June 2017 — 302,000 — — 302,000 1 June 2018 to
31 May 2027
17.64
54 Wynn Macau, Limited
Other Information
Number of share options
Name of Director
Date of
grant of
share
options(1)
At
1 January
2017
Granted
during the
period(2)
Exercised
during the
period
Expired/
lapsed/
canceled
during the
period
At
30 June
2017
Exercise period
of share options
Exercise
price of
share
options
per Share
(HK$)
Mr. Nicholas
Sallnow-Smith
25 March 2010 50,000 — — — 50,000 25 March 2011 to
24 March 2020
10.92
17 May 2011 100,000 — — — 100,000 17 May 2012 to
16 May 2021
25.96
5 June 2012 114,000 — — — 114,000 5 June 2013 to
4 June 2022
19.04
16 May 2013 200,000 — — — 200,000 16 May 2014 to
15 May 2023
24.87
15 May 2014 161,000 — — — 161,000 15 May 2015 to
14 May 2024
31.05
21 May 2015 317,000 — — — 317,000 21 May 2016 to
20 May 2025
15.46
25 May 2016 483,000 — — — 483,000 25 May 2017 to
24 May 2026
11.58
1 June 2017 — 302,000 — — 302,000 1 June 2018 to 31
May 2027
17.64
Mr. Bruce Rockowitz 25 March 2010 50,000 — — — 50,000 25 March 2011 to
24 March 2020
10.92
17 May 2011 100,000 — — — 100,000 17 May 2012 to
16 May 2021
25.96
5 June 2012 152,000 — — — 152,000 5 June 2013 to
4 June 2022
19.04
16 May 2013 200,000 — — — 200,000 16 May 2014 to
15 May 2023
24.87
15 May 2014 161,000 — — — 161,000 15 May 2015 to
14 May 2024
31.05
21 May 2015 317,000 — — — 317,000 21 May 2016 to
20 May 2025
15.46
25 May 2016 483,000 — — — 483,000 25 May 2017 to
24 May 2026
11.58
1 June 2017 — 302,000 — — 302,000 1 June 2018 to
31 May 2027
17.64
SHARE OPTION SCHEME (CONTINUED)
55Interim Report 2017
Other Information
Number of share options
Name of Director
Date of
grant of
share
options(1)
At
1 January
2017
Granted
during the
period(2)
Exercised
during the
period
Expired/
lapsed/
canceled
during the
period
At
30 June
2017
Exercise period
of share options
Exercise
price of
share
options
per Share
(HK$)
Mr. Jeffrey Kin-fung
Lam
25 March 2010 250,000 — — — 250,000 25 March 2011 to
24 March 2020
10.92
17 May 2011 100,000 — — — 100,000 17 May 2012 to
16 May 2021
25.96
5 June 2012 190,000 — — — 190,000 5 June 2013 to
4 June 2022
19.04
16 May 2013 200,000 — — — 200,000 16 May 2014 to
15 May 2023
24.87
15 May 2014 161,000 — — — 161,000 15 May 2015 to
14 May 2024
31.05
21 May 2015 317,000 — — — 317,000 21 May 2016 to
20 May 2025
15.46
25 May 2016 483,000 — — — 483,000 25 May 2017 to
24 May 2026
11.58
1 June 2017 — 302,000 — — 302,000 1 June 2018 to
31 May 2027
17.64
Total 6,290,000 1,208,000 — — 7,498,000
The vesting periods of the above share options are 20% vesting on each of the anniversary date of
the date of grant.
Notes:
(1) Share options granted pursuant to the Company’s share option scheme
(2) The closing price of the Company’s Shares immediately before the date on which the options were granted
during the period was HK$17.30.
SHARE OPTION SCHEME (CONTINUED)
56 Wynn Macau, Limited
Other Information
PURCHASE, SALE OR REDEMPTION OF THE COMPANY’S LISTED SECURITIES
Neither the Company nor any of its subsidiaries purchased, sold or redeemed any of the Group’s
listed securities during the six months ended 30 June 2017.
CORPORATE GOVERNANCE
Our commitment to integrity and dedication to maintaining and ensuring high standards of
corporate governance are fundamental to our ability to conduct our business and sustain the respect
of the investment community and the people who regulate our industry. The Company’s corporate
governance practices are based on the principles, code provisions and certain recommended best
practices as set out in the Code and are regularly reviewed and developed in the interests of the
Company, its Shareholders and other stakeholders.
The Company has complied with the code provisions in the Code for the six months ended 30 June
2017 except for the following deviations from provisions A.2.1 and E.1.2 of the Code.
Mr. Stephen A. Wynn as our Chairman and Chief Executive Officer
Under code provision A.2.1 of the Code, the roles of chairman and chief executive officer should be
separate and should not be performed by the same individual. The Company does not at present
separate the roles of the chairman and chief executive officer.
Mr. Wynn, the founder of the Company and WRM, serves as the Chairman and Chief Executive
Officer of the Company. The Board has determined that the combination of these roles held
singularly by Mr. Wynn is in the best interest of the Company and all Shareholders. The Board
believes that the issue of whether to combine or separate the offices of Chairman of the Board and
Chief Executive Officer is part of the succession planning process and that it is in the best interests
of the Company for the Board to make a determination whether to combine or separate the roles
based upon the circumstances. The Board has given careful consideration to separating the roles of
Chairman and Chief Executive Officer and has determined that the Company and its Shareholders
are best served by the current structure. Mr. Wynn’s combined role promotes unified leadership
and direction for the Board and executive management and allows for a single, clear focus for the
Company’s operational and strategic efforts.
The combined role of Mr. Wynn as both Chairman and Chief Executive Officer is balanced by the
Company’s governance structure, policies and controls. All major decisions are made in consultation
with members of the Board and the relevant Board committees. The Company has three Board
committees, namely the audit and risk committee, remuneration committee, and nomination and
corporate governance committee. Each Board committee comprises non-executive Directors only
and is chaired by an independent non-executive Director. In addition, there are four independent
non-executive Directors on the Board offering independent perspectives.
57Interim Report 2017
Other Information
CORPORATE GOVERNANCE (CONTINUED)
Mr. Stephen A. Wynn as our Chairman and Chief Executive Officer (Continued)
This structure encourages independent and effective oversight of the Company’s operations and
prudent management of risk.
For the reasons stated above and as a result of the structure, policies and procedures outlined
above, and in light of the historical success of Mr. Wynn’s leadership, the Board has concluded that
the current Board leadership structure is in the best interests of the Company and its Shareholders.
Annual General Meeting
Under code provision E.1.2, the chairman of the board should attend the annual general meetings of
the Company. Mr. Wynn, our Chairman, was unable to travel internationally to attend the Company’s
annual general meeting held on 1 June 2017 while recovering from an orthopedic procedure.
MODEL CODE
The Company adopted the Model Code on 16 September 2009 as its code of conduct for securities
transactions by Directors. On 23 March 2010, the Company adopted its own code of conduct
for securities transactions which was updated in March 2017. The terms of such code are no less
exacting than those set out in the Model Code. Having made specific enquiry of the Directors,
all Directors have confirmed that they have complied with the required standard of dealings and
code of conduct regarding securities dealings by directors as set out in the Model Code and the
Company’s own code of conduct for the six months ended 30 June 2017.
QUARTERLY REPORTING BY WYNN RESORTS, LIMITED
Our ultimate controlling shareholder, Wynn Resorts, Limited, is listed on the NASDAQ Stock
Market and is a reporting company under the United States Securities Exchange Act of 1934
which is required to file quarterly reports with the SEC. Each quarter, Wynn Resorts, Limited issues
press releases in the United States relating to its quarterly financial information (including financial
information about the Macau segments of Wynn Resorts, Limited, which are operated by the
Company). Such information will be presented in accordance with U.S. GAAP.
At the same time as Wynn Resorts, Limited releases its quarterly press releases, the Company
makes an announcement on the Hong Kong Stock Exchange pursuant to Rule 13.09 and 37.47B
of the Listing Rules and Part XIVA of the SFO by extracting the key highlights of the press release
pertaining to the Group. Such announcement will also include a quarterly income statement for the
Group presented in accordance with IFRS.
58 Wynn Macau, Limited
Other Information
QUARTERLY REPORTING BY WYNN RESORTS, LIMITED (CONTINUED)
In addition to the quarterly press release, Wynn Resorts, Limited also files quarterly reports with the
SEC. Simultaneously with the filing of such report in the United States, the Company also makes an
announcement on the Hong Kong Stock Exchange pursuant to Rule 13.09 and 37.47B of the Listing
Rules and Part XIVA of the SFO by extracting the key highlights of the quarterly report pertaining to
the Group.
CONTINUING DISCLOSURE PURSUANT TO LISTING RULES 13.18 AND 13.21
Under the terms of the Wynn Macau Credit Facilities, it is an event of default if Wynn Resorts,
Limited, the Company’s Controlling Shareholder, ceases to own directly or indirectly at least 51%
of the voting rights or issued capital of WRM or ceases to retain the ability or the right to direct
or procure the direction of the management and policies of WRM. Upon an event of default, the
lenders are entitled to exercise certain remedies including acceleration of the indebtedness under
the senior secured credit facilities.
In addition, the terms of the WML 2021 Notes contain a change of control provision that would, if
triggered, give rise to a right in favor of the holders of the WML 2021 Notes to require the Company
to repurchase such notes. The circumstances that will constitute a change of control include:
(1) the consummation of any transaction that results in any party other than Mr. Stephen A.
Wynn and his related parties becoming the direct or indirect owner of more than 50% of the
outstanding voting stock of WRL;
(2) the first day on which a majority of the members of the board of directors of either the
Company or WRL are not directors who were on the board at the date of issuance of the WML
2021 Notes, or directors who were nominated, elected, or appointed by a majority of the
directors who were on the board at the date of issuance of the WML 2021 Notes;
(3) the first day on which WRL ceases to own, directly or indirectly, a majority of the outstanding
issued share capital (including warrants, options or other rights convertible into share capital) of
the Company; and
(4) WRL consolidates with, or merges with or into, any other party or sells, assigns, conveys,
transfers, leases or otherwise disposes of all or substantially all of its assets to any party, or any
party consolidates with, or merges with or into, WRL in any such event pursuant to a transaction
in which any of the outstanding voting stock of WRL is converted into or exchanged for cash,
securities or other property, other than any such transaction where the voting stock of WRL
outstanding immediately prior to such transaction is converted into or exchanged for voting
stock that results in WRL holding a majority of the voting stock of the transferee or surviving
party.
Save as disclosed above, our Company does not have any other disclosure obligations under Rules
13.18 and 13.21 of the Listing Rules.
59Interim Report 2017
Other Information
LITIGATION
The Group did not have any material litigation outstanding as at 30 June 2017. The litigation matters
set out below are disclosed on a voluntary basis and, as with all litigation, no assurances can be
provided as to the outcome thereof.
Macau Litigation Related to Okada
WRM and certain individuals who are or were directors of WRM and/or the Company (collectively,
the “Wynn Macau Parties”) were named as defendants in a lawsuit filed in the Court of First
Instance of Macau (the “Macau Court”) by Mr. Kazuo Okada (“Okada”) and two of Okada’s
controlled companies, Aruze USA, Inc. and Universal Entertainment Corp. (collectively, the “Okada
Parties”). The principal allegations in the lawsuit were that the redemption of the Okada Parties’
shares in WRL was improper and undervalued, that the previously disclosed payment by WRM to
an unrelated third party in consideration of relinquishment by that party of certain rights in and to
any future development on the land in Cotai where Wynn Palace is located was unlawful and that
the Company’s previously disclosed donation by WRM to the University of Macau Development
Foundation was unlawful. The Okada Parties sought the dissolution of WRM and compensatory
damages. The Company made a voluntary announcement in respect of this lawsuit on 3 July 2015.
On 11 July 2017, the Macau Court dismissed all the claims made by the Okada Parties against the
Wynn Macau Parties as unfounded and imposed a fine of MOP41,500 (approximately HK$40,000)
on the Okada Parties for being vexatious litigants. In addition, the Macau Court ordered the Okada
Parties to pay Court fees and lawyer fees of the Wynn Macau Parties. As of the date of this interim
report we have not been notified of any appeal.
Macau Litigation Related to Dore
WRM has been named as a defendant in lawsuits filed in the Macau Court of First Instance by
individuals who claim to be investors in or persons with credit in accounts maintained by Dore
Entertainment Company Limited (“Dore”), an independent, Macau registered and licensed company
that operates a gaming promoter business at Wynn Macau. In connection with the alleged theft,
embezzlement, fraud and/or other crime(s) perpetrated by a former employee of Dore (the “Dore
Incident”), the plaintiffs of the lawsuits allege that Dore failed to honor withdrawal of funds
deposited with Dore as investments or gaming deposits that allegedly resulted in certain losses
for these individuals. The principal allegations common to the lawsuits are that WRM, as a gaming
concessionaire, should be held responsible for Dore’s conduct on the basis that WRM is responsible
for the supervision of Dore’s activities at Wynn Macau that resulted in the purported losses.
60 Wynn Macau, Limited
Other Information
LITIGATION (CONTINUED)
Macau Litigation Related to Dore (Continued)
The Company made a voluntary announcement in connection with the Dore Incident on 14
September 2015. The Company has sought advice from counsel in Macau, and based on such advice,
the Company believes the claims are devoid of merit and are unfounded. The Company intends to
vigorously defend WRM in the lawsuits.
COOPERATION WITH THE CCAC
In July 2014, the Company was contacted by the Commission Against Corruption of Macau (the
“CCAC”) requesting certain information related to the Company’s land in the Cotai area of Macau.
The Company has cooperated with the CCAC’s request.
CHANGES IN INFORMATION OF DIRECTORS
Pursuant to Rule 13.51(B)(1) of the Listing Rules, the changes in information of Directors of the
Company are set out below:
(a) In March 2017, Mr. Ian Michael Coughlan relinquished his role as President of WRM after his
appointment as President of the Company and the assumption of all responsibility for the
Group.
(b) Ms. Linda Chen was appointed as President of WRM in March 2017.
(c) Mr. Nicholas Sallnow-Smith resigned as a non-executive director of Aviva Life Insurance
Company Limited effective on 1 April 2017.
(d) Mr. Jeffrey Kin-fung Lam’s term as Chairman of the Mega Events Fund Assessment Committee
was completed on 30 June 2017.
REVIEW OF UNAUDITED INTERIM FINANCIAL INFORMATION
The Group’s unaudited interim financial information for the reporting period has been reviewed
by the Company’s Audit and Risk Committee members which comprises three independent non-
executive Directors: Mr. Nicholas Sallnow-Smith, Dr. Allan Zeman and Mr. Bruce Rockowitz and by
the Company’s auditor in accordance with Hong Kong Standards on Review Engagements 2410,
Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued
by the Hong Kong Institute of Certified Public Accountants.
On behalf of the Board
Stephen A. Wynn
Chairman
Hong Kong, 17 August 2017
61Interim Report 2017
Report on Review of Interim Financial Information
22/F
CITIC Tower
1 Tim Mei Avenue
Central
Hong Kong
To the shareholders of Wynn Macau, Limited
(Incorporated in the Cayman Islands with limited liability)
INTRODUCTION
We have reviewed the accompanying interim financial information of Wynn Macau, Limited
(the “Company”) and its subsidiaries (together, the “Group”) set out on pages 63 to 93 which
comprises the condensed consolidated statement of financial position as at 30 June 2017 and
the related condensed consolidated statement of profit or loss and other comprehensive income,
condensed consolidated statement of changes in equity and condensed consolidated statement
of cash flows for the six-month period then ended, and explanatory notes. The Rules Governing
the Listing of Securities on The Stock Exchange of Hong Kong Limited require the preparation of
a report on interim financial information to be in compliance with the relevant provisions thereof
and International Accounting Standard 34 Interim Financial Reporting (“IAS 34”) issued by the
International Accounting Standards Board.
The directors of the Company are responsible for the preparation and presentation of this interim
financial information in accordance with IAS 34. Our responsibility is to express a conclusion on this
interim financial information based on our review. Our report is made solely to you, as a body, in
accordance with our agreed terms of engagement, and for no other purpose. We do not assume
responsibility towards or accept liability to any other person for the contents of this report.
SCOPE OF REVIEW
We conducted our review in accordance with Hong Kong Standard on Review Engagements 2410
Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued
by the Hong Kong Institute of Certified Public Accountants. A review of interim financial information
consists of making inquiries, primarily of persons responsible for financial and accounting matters,
and applying analytical and other review procedures. A review is substantially less in scope than an
audit conducted in accordance with Hong Kong Standards on Auditing. Consequently, it does not
enable us to obtain assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
62 Wynn Macau, Limited
Report on Review of Interim Financial Information
CONCLUSION
Based on our review, nothing has come to our attention that causes us to believe that the
accompanying interim financial information is not prepared, in all material respects, in accordance
with IAS 34.
Ernst & Young
Certified Public Accountants
Hong Kong
17 August 2017
63Interim Report 2017
Interim Financial Information
Condensed Consolidated Statement of Profit or Loss
and Other Comprehensive Income
For the Six Months Ended
30 June
2017 2016
HK$ HK$
Notes (in thousands)
(unaudited) (unaudited)
Operating revenues
Casino 15,603,397 9,153,749
Rooms 242,142 62,909
Food and beverage 257,318 107,554
Retail and other 688,074 365,613
16,790,931 9,689,825
Operating costs and expenses
Gaming taxes and premiums 7,779,751 4,404,799
Staff costs 2,290,456 1,750,501
Other operating expenses 3 2,952,426 1,601,105
Depreciation and amortization 1,393,098 464,141
Property charges and other 7,739 8,897
14,423,470 8,229,443
Operating profit 2,367,461 1,460,382
Finance revenues 4 4,982 19,164
Finance costs 5 (625,828) (293,442)
Net foreign currency differences (140,263) (15,482)
Changes in fair value of interest rate swaps (8,190) (22,193)
(769,299) (311,953)
Profit before tax 1,598,162 1,148,429
Income tax expense 6 6,214 7,524
Net profit attributable to owners of the Company 1,591,948 1,140,905
Other comprehensive income
Other comprehensive income to be reclassified
to profit or loss in subsequent periods:
Currency translation reserve (208) —
Other comprehensive income for the period (208) —
Total comprehensive income attributable to owners
of the Company 1,591,740 1,140,905
Basic and diluted earnings per Share 7 HK$0.31 HK$0.22
64 Wynn Macau, Limited
Interim Financial Information
Condensed Consolidated Statement of Financial Position
As at As at
30 June
2017
31 December
2016
HK$ HK$
Notes (in thousands)
(unaudited) (audited)
Non-current assets
Property and equipment and construction in progress 10 34,732,685 35,858,056
Leasehold interests in land 1,734,537 1,782,623
Goodwill 398,345 398,345
Deposits for acquisition of property and equipment 12,290 18,342
Other non-current assets 852,462 910,186
Restricted cash and cash equivalents 5,393 9,842
Total non-current assets 37,735,712 38,977,394
Current assets
Inventories 328,357 338,023
Trade and other receivables 11 585,495 733,001
Prepayments and other current assets 141,163 128,596
Interest rate swaps 871 8,189
Amounts due from related companies 17 183,264 156,561
Restricted cash and cash equivalents 13,432 12,267
Cash and cash equivalents 2,341,980 2,591,442
Total current assets 3,594,562 3,968,079
Current liabilities
Accounts payable 12 519,129 525,501
Construction and retentions payables 1,007,029 1,167,082
Other payables and accruals 13 7,413,814 5,866,015
Interest rate swaps 859 —
Amounts due to related companies 17 187,157 202,298
Income tax payables 6 6,214 12,427
Other current liabilities 56,480 55,763
Total current liabilities 9,190,682 7,829,086
Net current liabilities (5,596,120) (3,861,007)
Total assets less current liabilities 32,139,592 35,116,387
65Interim Report 2017
Interim Financial Information
Condensed Consolidated Statement of Financial Position
As at As at
30 June
2017
31 December
2016
HK$ HK$
Notes (in thousands)
(unaudited) (audited)
Non-current liabilities
Interest-bearing borrowings 14 29,787,136 32,169,888
Construction retentions payable 129 1,244
Other payables and accruals 13 257,525 325,022
Other long-term liabilities 160,906 167,169
Total non-current liabilities 30,205,696 32,663,323
Net assets 1,933,896 2,453,064
Equity
Equity attributable to owners of the Company
Issued capital 5,196 5,196
Share premium account 255,314 161,746
Shares held for employee ownership scheme (108,997) (109,000)
Reserves 1,782,383 2,395,122
Total equity 1,933,896 2,453,064
Approved and authorized for issue by the Board of Directors on 17 August 2017.
Stephen A. Wynn Matthew O. Maddox
Director Director
66 Wynn Macau, Limited
Interim Financial Information
Condensed Consolidated Statement of Changes in Equity
Attributable to owners of the Company
Issued
Capital
HK$
Share
Premium
Account
HK$
Shares
Held For
Employee
Ownership
Scheme
HK$
Share
Option
Reserve*
HK$
Other
Reserves*#
HK$
Statutory
Reserve*
HK$
Retained
Earnings*
HK$
Currency
Translation
Reserve*
HK$
Total
Equity
HK$
Note (in thousands)
At 1 January 2017 (audited) 5,196 161,746 (109,000) 623,451 554,740 48,568 1,151,055 17,308 2,453,064
Net profit for the period — — — — — — 1,591,948 — 1,591,948
Changes in currency translation
reserve — — — — — — — (208) (208)
Total comprehensive
income for the period — — — — — — 1,591,948 (208) 1,591,740
Share-based payments — — — 69,956 — — — — 69,956
Transfer to share premium
upon vesting of awards under
the employee ownership
scheme — 93,568 3 (93,571) — — — — —
Returned dividend from
forfeited awards under
the employee ownership
scheme — — — — — — 1,257 — 1,257
2016 final dividend declared 8 — — — — — — (2,182,121) — (2,182,121)
At 30 June 2017 (unaudited) 5,196 255,314 (108,997) 599,836 554,740 48,568 562,139 17,100 1,933,896
At 1 January 2016 (audited) 5,196 161,746 (50,184) 522,926 554,740 48,568 2,842,459 16,828 4,102,279
Net profit for the period — — — — — — 1,140,905 — 1,140,905
Total comprehensive income
for the period — — — — — — 1,140,905 — 1,140,905
Share-based payments — — — 50,032 — — — — 50,032
Shares purchased for
employee ownership scheme — — (58,817) — — — — — (58,817)
Special dividend paid 8 — — — — — — (3,109,263) — (3,109,263)
At 30 June 2016 (unaudited) 5,196 161,746 (109,001) 572,958 554,740 48,568 874,101 16,828 2,125,136
* These reserve accounts comprise the consolidated reserves of HK$1.8 billion in the condensed consolidated
statement of financial position at 30 June 2017 (31 December 2016: HK$2.4 billion).
# “Other reserves” at 1 January 2017 is composed of HK$194.3 million (1 January 2016: HK$194.3 million) of
issued capital of Wynn Resorts (Macau) S.A. (“WRM”) and HK$360.4 million (1 January 2016: HK$360.4 million) of
issued capital of Wynn Resorts International, Ltd..
67Interim Report 2017
Interim Financial Information
Condensed Consolidated Statement of Cash Flows
For the Six Months Ended
30 June
2017 2016
HK$ HK$
Note (in thousands)
(unaudited) (unaudited)
Net cash flows generated from operating activities 5,434,876 1,990,172
Investing activities
Purchase of property and equipment,
net of construction and retentions payables (401,435) (3,134,450)
Purchase of other non-current assets — (263,235)
Proceeds from sale of property and equipment and
other assets 1,399 5,457
Interest received 4,759 21,970
Net cash flows used in investing activities (395,277) (3,370,258)
Financing activities
Proceeds from borrowings 1,013,424 1,168,600
Repayment of borrowings (3,573,164) —
Interest paid (550,889) (221,117)
Payment of land premiums — (124,015)
Decrease/(increase) in restricted cash and
cash equivalents 3,284 (6,142)
Dividend paid 8 (2,183,783) (3,109,263)
Payment of debt financing costs — (12,719)
Shares purchased for employee ownership scheme — (58,817)
Net cash flows used in financing activities (5,291,128) (2,363,473)
Net decrease in cash and cash equivalents (251,529) (3,743,559)
Cash and cash equivalents at 1 January 2,591,442 6,731,356
Effect of foreign exchange rate changes, net 2,067 3,752
Cash and cash equivalents at 30 June 2,341,980 2,991,549
68 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
1. CORPORATE INFORMATION
The Company was incorporated in the Cayman Islands as an exempted company with limited
liability on 4 September 2009. The Company’s Shares were listed on the Main Board of the
Hong Kong Stock Exchange on 9 October 2009. The Company’s registered office address is
P.O. Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands, or at such other place
as the Directors may from time to time decide.
The Group owns and operates hotel and casino resorts in Macau, namely Wynn Macau and
Wynn Palace. WRM conducts gaming activities in our casinos in Macau under a concession
contract signed with the Macau government on 24 June 2002. The 20-year concession period
commenced on 27 June 2002 and will expire on 26 June 2022.
The Group also owns a land concession for approximately 51 acres of land in the Cotai area
of Macau (the “Cotai Land”) for a term of 25 years from May 2012. The Group opened Wynn
Palace, an integrated resort, situated on the Cotai Land on 22 August 2016.
WM Cayman Holdings Limited I owns approximately 72% of the Company and approximately
28% of the Company is owned by public shareholders. The ultimate parent company of Wynn
Macau, Limited is Wynn Resorts, Limited, a publicly-traded company incorporated in the United
States of America.
69Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
1. CORPORATE INFORMATION (CONTINUED)
Information about subsidiaries
The following is a list of subsidiaries of the Company as at 30 June 2017:
Name
Place of
Incorporation/
Operation
Principal
Activities
Nominal Value of
Issued Share/
Registered Capital
Interest
Held
WM Cayman Holdings Limited II Cayman Islands Investment
Holding
Ordinary shares
— US$1
100%
Wynn Resorts International, Ltd. Isle of Man Investment
Holding
Ordinary shares
— GBP2
100%
Wynn Resorts (Macau) Holdings, Ltd. Isle of Man Investment
Holding
Ordinary shares
— Class A shares:
GBP343
100%
— Class B shares:
GBP657
Wynn Resorts (Macau),
Limited
Hong Kong Investment
Holding
Ordinary shares
— HK$100
100%
Wynn Resorts (Macau) S.A. Macau Operator of
hotel casino
and related
gaming
businesses
Share capital
— MOP200,100,000
100%**
Palo Real Estate Company Limited Macau Development,
design and
preconstruction
activities
Share capital
— MOP1,000,000
100%
WML Finance I Limited Cayman Islands Entity facilitates
lending within the
Group
Ordinary shares
— US$1
100%
WML Corp. Ltd. Cayman Islands Investment
holding
Ordinary shares
— US$1
100%*
* Shares directly held by the Company
** 10% of the shares were held by a Macau-resident investor which entitle the holder to 10% of the voting
and social rights and the rights to maximum dividend or payment upon dissolution of one MOP. The
remaining 90% of the shares held by the Group are entitled to 90% of the voting rights and 100% of the
profit participation or economic interest.
None of the subsidiaries had any debt securities outstanding at 30 June 2017 or at any time
during the six months ended 30 June 2017.
70 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
1. CORPORATE INFORMATION (CONTINUED)
Contribution to Trust
The Company has consolidated an operating entity within the Group without any legal interests.
Due to the implementation of the employee ownership scheme of the Group, the Company has
set up a structured entity, Trust, and its particulars are as follows:
Structured Entity Principal Activities
Trust Administering and holding the Company’s Shares acquired for the
employee ownership scheme, which is set up for the benefits of eligible
persons of the scheme
2.1 ACCOUNTING POLICIES AND BASIS OF PREPARATION
This interim financial information has been prepared in accordance with the applicable
disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on the
Hong Kong Stock Exchange and International Accounting Standard (“IAS”) 34 Interim Financial
Reporting issued by the International Accounting Standards Board. The interim financial
information does not include all the information and disclosures required in the annual financial
statements, and should be read in conjunction with the Group’s annual financial statements for
the year ended 31 December 2016.
As at 30 June 2017, the Group had cash and cash equivalents of HK$2.3 billion derived from
its ordinary business operations. These cash and cash equivalents have not been earmarked for
any specific use other than for general corporate purposes and repayments on the Group’s debt
obligations.
As at 30 June 2017, the Group had a net current liability position of HK$5.6 billion. The Group
expects it will generate positive cash flows in the coming twelve months and may obtain or
renew its bank loan facilities and, or seek other sources of funding, wherever needed, to meet
its financial liabilities as and when they fall due. The Group believes it has sufficient working
capital to finance its operations and financial obligations.
71Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
2.2 IMPACT OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING
STANDARDS (“IFRSs”)
The accounting policies adopted in the preparation of the interim condensed consolidated
financial statements are consistent with those followed in the preparation of the Group’s
annual consolidated financial statements for the year ended 31 December 2016, except for the
adoption of following revised standards effective as of 1 January 2017:
Amendments to IAS 7 Disclosure Initiative
Amendments to IAS 12 Recognition of Deferred Tax Assets for Unrealized Losses
Annual Improvements
2014–2016 Cycle
Amendments to a number of IFRSs
The adoption of these revised standards has no significant financial effect on the interim
financial information and there has been no significant change to the accounting policies
applied in the interim financial information.
2.3 NEW AND REVISED IFRSs NOT YET EFFECTIVE
The Group has not early adopted any other standard, interpretation or amendment that has
been issued but is not yet effective.
2.4 SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision-makers, who are responsible for allocating resources and assessing
performance of the operating segments and making strategic decisions. For management
purposes, during the six months ended 30 June 2017, the Group reviews Wynn Macau and
Wynn Palace as two reportable segments. Refer to note 9 for segment information.
72 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
3. OTHER OPERATING EXPENSES
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Gaming promoters’ commissions 898,796 427,922
License fees 656,084 366,109
Cost of sales 253,481 126,433
Advertising and promotions 234,771 104,326
Operating supplies and equipment 191,819 99,461
Repairs and maintenance 176,493 110,363
Utilities and fuel 164,618 87,263
Contract services 148,620 74,244
Corporate support services and other 57,734 49,217
Other support services 30,297 18,728
Operating rental expenses 29,156 33,037
Auditor’s remuneration 4,335 3,487
Reversal of provision for doubtful accounts, net (43,167) (21,347)
Other expenses 149,389 121,862
2,952,426 1,601,105
73Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
4. FINANCE REVENUES
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Interest income from cash at banks 4,982 19,164
5. FINANCE COSTS
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Interest expense 548,700 555,363
Bank fees for unused facilities 11,712 4,714
Amortization of debt financing costs 65,416 64,541
Less: capitalized interest — (331,176)
625,828 293,442
No interest was capitalized during the six months ended 30 June 2017. For the six months
ended 30 June 2016, interest was capitalized using a weighted average rate of 2.98%.
74 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
6. INCOME TAX EXPENSE
The major components of income tax expense for the six months ended 30 June 2017 and 2016
were:
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Income tax expense:
Current — overseas 6,214 7,524
6,214 7,524
No provision for Hong Kong profit tax for the six months ended 30 June 2017 has been made
as there was no assessable profit generated in Hong Kong (six months ended 30 June 2016:
Nil). Taxation for overseas jurisdictions is charged at the appropriate prevailing rates ruling
in the respective jurisdictions and the maximum rate is 12% (six months ended 30 June 2016:
12%). For the six months ended 30 June 2017, the tax provision of HK$6.2 million results from
the current income tax expense accrued by our subsidiaries owning WRM’s shares under the
WRM Shareholder Dividend Tax Agreement (six months ended 30 June 2016: HK$7.5 million).
On 15 October 2015, WRM received a 5-year exemption from Macau’s 12% Complementary
Tax on casino gaming profits (the “Tax Holiday”) effective from 1 January 2016 through 31
December 2020. Accordingly, the Group was exempted from the payment of approximately
HK$206.3 million in such tax for the six months ended 30 June 2017 (six months ended 30
June 2016: HK$162.1 million). The Group’s non-gaming profits remain subject to the Macau
Complementary Tax and its casino winnings remain subject to the Macau Special Gaming Tax
and other levies in accordance with its Concession Agreement.
75Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
6. INCOME TAX EXPENSE (CONTINUED)
In August 2016, WRM renewed the WRM Shareholder Dividend Tax Agreement with the
Macau Special Administrative Region that provided for annual payments of MOP12.8 million
(approximately HK$12.4 million) to the Macau Special Administrative Region in lieu of
Complementary Tax on dividend distributions to its shareholders from gaming profits for each
of the years 2016 through 2020.
The Group is exempted from income tax in the Isle of Man and the Cayman Islands. The
Group’s subsidiaries file income tax returns in Macau and various foreign jurisdictions as
required by law. The Group’s income tax returns are subject to examinations by tax authorities
in the locations where it operates. The Group’s 2012 to 2016 Macau Complementary Tax
returns remain subject to examination by the Financial Services Bureau of the Government of
the Macau Special Administrative Region (the “Financial Services Bureau”). In April 2016, the
Financial Services Bureau examined the 2011 and 2012 Macau Complementary Tax returns of
Palo. In June 2016, the Financial Services Bureau issued its final tax assessments for Palo for
the years 2011 and 2012 and the examination resulted in no change to the tax returns. The
Financial Services Bureau has also commenced examinations of the 2013 and 2014 Macau
Complementary Tax returns for WRM and Palo. Since the examinations are in their initial stages,
the Group is unable to determine if they will conclude within the next 12 months. The Group
believes that its liability for uncertain tax positions is adequate with respect to these years.
Quarterly, the Group undertakes reviews for any potentially unfavorable tax outcome and when
an unfavorable outcome is identified as being probable and can be reasonably estimated,
the Group then establishes a tax reserve for such possible unfavorable outcome. Estimating
potential tax outcomes for any uncertain tax issues is highly judgmental and may not be
indicative of the ultimate settlement with the tax authorities.
76 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
6. INCOME TAX EXPENSE (CONTINUED)
As at 30 June 2017, the Group has unrecognized tax losses of HK$5.4 billion (31 December
2016: HK$4.1 billion) and the Group believes that these unrecognized tax losses are adequate
to offset adjustments that might be proposed by the Macau tax authorities. The Group believes
that it has adequately provided reasonable reserves for prudent and foreseeable outcomes
related to uncertain tax matters.
7. EARNINGS PER SHARE ATTRIBUTABLE TO OWNERS OF THE COMPANY
The calculation of basic earnings per Share for the six months ended 30 June 2017 is based
on the consolidated net profit attributable to owners of the Company and on the weighted
average number of Shares in issue of 5,180,316,178 during the period (six months ended
30 June 2016: 5,181,626,809), excluding Shares reserved and purchased for the Company’s
employee ownership scheme. No Shares (six months ended 30 June 2016: 5,500,800) were
purchased and none of the Shares (six months ended 30 June 2016: nil) were issued and
reserved for the Company’s employee ownership scheme during the six months ended 30 June
2017.
The calculation of diluted earnings per Share for the six months ended 30 June 2017 is based
on the consolidated net profit attributable to owners of the Company and on the weighted
average number of Shares of 5,187,269,182 (six months ended 30 June 2016: 5,182,335,253)
including the weighted average number of Shares in issue of 5,180,316,178 during the period
(six months ended 30 June 2016: 5,181,626,809) plus the weighted average number of potential
Shares of 6,953,004 (six months ended 30 June 2016: 708,444) arising from the deemed
exercise of share options and deemed vesting of awards under the Company’s employee
ownership scheme.
77Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
8. DIVIDENDS
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Special dividend for 2016 paid of nil
(2015: HK$0.6) per Share — 3,109,263
2016 final dividend of HK$0.42 per Share declared
(2015: nil) 2,182,121 —
2,182,121 3,109,263
On 17 August 2017, the Board resolved to declare an interim dividend of HK$0.21 per Share to
be paid in respect of the six months ended 30 June 2017.
78 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
9. SEGMENT INFORMATION
The Group’s principal operating activities occur in Macau, which is the sole geographic area
in which the Group is domiciled. The Group reviews the results of operations for each of
its operating segments. Wynn Macau and Encore at Wynn Macau are managed as a single
integrated resort and are aggregated as one operating segment, which is also a reportable
segment (“Wynn Macau”). Wynn Palace, which opened on 22 August 2016, is managed as an
operating segment and a separate reportable segment. The Group identifies each integrated
resort as a reportable segment considering operations within each integrated resort have
similar economic characteristics, type of customers, types of services and products, the
regulatory environment of the operations and the Group’s organizational and management
reporting structure. Other Macau primarily represents cash held at the Company.
For the Six Months Ended
30 June
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Net Revenue
Wynn Macau 9,869,328 9,689,825
Wynn Palace 6,921,603 —
Total 16,790,931 9,689,825
79Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
For the Six Months Ended
30 June
2017 2016
HK$ HK$
Notes (in thousands)
(unaudited) (unaudited)
Adjusted EBITDA
Wynn Macau 2,622,004 2,547,722
Wynn Palace 1,248,835 —
3,870,839 2,547,722
Other operating costs and expenses
Depreciation and amortization 1,393,098 464,141
Pre-opening costs# — 507,755
Property charges and other 7,739 8,897
Share-based payments 62,339 64,015
Wynn Macau, Limited corporate expenses 40,202 42,532
Operating profit 2,367,461 1,460,382
Non-operating income and expenses
Finance revenues 4 4,982 19,164
Finance costs 5 (625,828) (293,442)
Net foreign currency differences (140,263) (15,482)
Change in fair value of interest rate swaps (8,190) (22,193)
Profit before tax 1,598,162 1,148,429
Income tax expense 6 6,214 7,524
Net profit attributable to owners of the Company 1,591,948 1,140,905
# Pre-opening costs represent personnel and other costs incurred prior to the opening of Wynn Palace and
are expensed as incurred. Wynn Palace opened on 22 August 2016.
9. SEGMENT INFORMATION (CONTINUED)
80 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
9. SEGMENT INFORMATION (CONTINUED)
As at
30 June
2017
As at
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Total assets
Wynn Palace 32,092,945 33,320,609
Wynn Macau 9,152,289 9,537,765
Other Macau 85,040 87,099
41,330,274 42,945,473
10. PROPERTY AND EQUIPMENT AND CONSTRUCTION IN PROGRESS
For the six months ended 30 June 2017, the Group incurred HK$231.1 million (six months
ended 30 June 2016: HK$2.3 billion) on additions of property and equipment and construction
in progress. The Group disposed of property and equipment and construction in progress with
a net carrying amount of HK$9.1 million (six months ended 30 June 2016: HK$14.5 million).
81Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
11. TRADE AND OTHER RECEIVABLES
Trade and other receivables consist of the following as at 30 June 2017 and 31 December 2016:
As at As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Casino 529,038 806,824
Retail leases and other 115,455 91,155
Hotel 18,050 30,309
662,543 928,288
Less: allowance for doubtful accounts (77,048) (195,287)
Total trade and other receivables, net 585,495 733,001
82 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
11. TRADE AND OTHER RECEIVABLES (CONTINUED)
An aged analysis of trade and other receivables is as follows:
As at As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Within 30 days 251,169 241,472
31 to 60 days 106,350 121,638
61 to 90 days 87,534 90,837
Over 90 days 217,490 474,341
662,543 928,288
Less: allowance for doubtful accounts (77,048) (195,287)
Net trade and other receivables 585,495 733,001
The advanced commissions are on terms requiring settlement within five business days of
the month following the advance. Except for the advanced commissions, the trade and other
receivables are generally repayable within 14 days.
83Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
12. ACCOUNTS PAYABLE
During the six months ended 30 June 2017 and the year ended 31 December 2016, the Group
normally received credit terms of 30 days. An aged analysis of accounts payable as at the end of
the reporting period, based on invoice dates, is as follows:
As at As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Within 30 days 422,462 391,409
31 to 60 days 24,098 44,384
61 to 90 days 15,395 30,352
Over 90 days 57,174 59,356
519,129 525,501
13. OTHER PAYABLES AND ACCRUALS
Other payables and accruals consist of the following as at 30 June 2017 and 31 December 2016:
As at As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Current:
Outstanding chip liabilities 3,519,660 2,102,057
Customer deposits 1,803,024 1,758,819
Gaming taxes payable 1,293,321 1,175,553
Donation payable 77,670 77,670
Other liabilities 720,139 751,916
7,413,814 5,866,015
Non-current:
Donation payable 257,525 325,022
Total 7,671,339 6,191,037
84 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
14. INTEREST-BEARING BORROWINGS
As at As at
30 June
2017
31 December
2016
HK$ HK$
Notes (in thousands)
(unaudited) (audited)
Bank loans, secured (a) 19,515,928 22,003,178
Senior notes, unsecured (b) 10,564,477 10,498,819
30,080,405 32,501,997
Less: debt financing costs, net (293,269) (332,109)
Total interest-bearing borrowings 29,787,136 32,169,888
The borrowings are repayable as follows:
As at As at
30 June
2017
31 December
2016
HK$ HK$
Notes (in thousands)
(unaudited) (audited)
Bank loans: (a)
In the second to fifth years, inclusive 19,515,928 22,003,178
Less: debt financing costs, net (219,352) (250,622)
19,296,576 21,752,556
Senior notes: (b)
In the second to fifth years, inclusive 10,564,477 10,498,819
Less: debt financing costs, net (73,917) (81,487)
10,490,560 10,417,332
85Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
14. INTEREST-BEARING BORROWINGS (CONTINUED)
Notes:
(a) Bank loans, secured
Wynn Macau Credit Facilities
As at 30 June 2017, the Wynn Macau Credit Facilities consisted of approximately HK$23.8 billion
equivalent in a combination of Hong Kong dollar and U.S. dollar facilities, including an approximately
HK$18.0 billion equivalent fully funded senior term loan facility and an approximately HK$5.8 billion
equivalent senior revolving credit facility.
There is also an option to upsize the total senior secured credit facilities by approximately an additional
HK$7.8 billion equivalent (US$1.0 billion) under the Wynn Macau Credit Facilities and related agreements
upon the satisfaction of various conditions. The borrowings under the Wynn Macau Credit Facilities
were used to refinance WRM’s indebtedness in 2015 and for a variety of purposes, including to fund the
construction and development of Wynn Palace and for general corporate purposes.
The HK$18.0 billion equivalent term loan facility is repayable in graduating installments of between 2.50%
to 7.33% of the principal amount on a quarterly basis commencing December 2018, with a final installment
of 50% of the principal amount repayable in September 2021. The final maturity of any outstanding
borrowings from the revolving credit facility is September 2020, by which time any outstanding borrowings
from the revolving loans must be repaid.
The borrowings under the Wynn Macau Credit Facilities bear interest at LIBOR or HIBOR plus a margin of
1.50% to 2.25% per annum based on WRM’s leverage ratio. Customary fees and expenses were paid by
WRM in connection with the Wynn Macau Credit Facilities.
As at 30 June 2017, the Group had HK$4.3 billion in funding available under the revolving credit facility of
the Wynn Macau Credit Facilities.
WMLF Revolving Credit Facility
On 18 July 2016, WMLF entered into an agreement as the borrower of a revolving credit facility for initially
up to HK$1.5 billion (approximately US$198.4 million) with Bank of China Limited, Macau Branch as the
lender.
Borrowings under the WMLF Revolving Credit Facility are secured by pledged US$ deposits of initially up
to US$200.0 million (approximately HK$1.6 billion) placed by WRL in a pledged account at Bank of China
Limited, Macau Branch.
Borrowings under the WMLF Revolving Credit Facility are used for working capital requirements and
general corporate purposes.
86 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
14. INTEREST-BEARING BORROWINGS (CONTINUED)
Notes: (continued)
(a) Bank loans, secured (continued)
WMLF Revolving Credit Facility (continued)
The final maturity of any outstanding borrowings under the WMLF Revolving Credit Facility is 18 July
2018, by which time any outstanding borrowings must be repaid in full. The borrowings under the
WMLF Revolving Credit Facility bear interest initially at 1.50% per annum, such rate is calculated as the
interest rate paid by Bank of China Limited, Macau Branch to WRL in respect of the US$ deposits in the
pledged account at Bank of China Limited, Macau Branch plus a margin of 0.40%. Under the terms of
the agreement, mandatory repayment is required upon a change in control or material adverse effect (as
defined in the agreement).
On 25 October 2016, the WMLF Revolving Credit Facility was amended and upsized, increasing the
available borrowing capacity to HK$3.9 billion (approximately US$495.9 million). The terms of the
borrowing for the increased principal amount under the amendment are equivalent to the terms of the
original credit agreement, including the requirement for cash collateral to be deposited and pledged with
the lender, and interest is borne at the same rate as described above.
As at 30 June 2017, the Group had no outstanding amounts under the WMLF Revolving Credit Facility and
the full HK$3.9 billion available.
(b) Senior notes, unsecured
The Company issued 5.25% fixed rate, unsecured senior notes due 15 October 2021 for an aggregate
principal amount of US$1.35 billion (approximately HK$10.5 billion). The Company used the net proceeds
from the offering of the WML 2021 Notes for working capital requirements and general corporate
purposes. The WML 2021 Notes are listed on the Hong Kong Stock Exchange.
87Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
15. COMMITMENTS
Operating lease commitments – Group as lessee
As at
30 June
2017
HK$
As at
31 December
2016
HK$
(in thousands)
(unaudited) (audited)
Within one year 109,553 118,125
After one year but not more than five years 317,478 335,386
More than five years 333,829 365,425
760,860 818,936
Operating lease commitments – Group as lessor
As at
30 June
2017
HK$
As at
31 December
2016
HK$
(in thousands)
(unaudited) (audited)
Within one year 714,205 728,526
After one year but not more than five years 1,947,417 2,020,754
More than five years 24,064 34,936
2,685,686 2,784,216
88 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
15. COMMITMENTS (CONTINUED)
Capital commitments
As at As at
30 June
2017
31 December
2016
HK$ HK$
(in thousands)
(unaudited) (audited)
Contracted, but not provided for 243,557 176,462
Gaming premium commitment
Pursuant to the Concession Agreement signed with the Macau government, the Group has
committed to pay an annual premium of MOP30.0 million (approximately HK$29.1 million)
plus a variable annual premium which is equal to MOP300,000 (approximately HK$291,000)
per gaming table reserved exclusively for certain kinds of games or players, MOP150,000
(approximately HK$146,000) per gaming table not so reserved and MOP1,000 (approximately
HK$970) per electrical or mechanical gaming machine, including slot machines, subject to an
annual minimum of MOP45.0 million (approximately HK$43.7 million).
Other services commitments
As at
30 June
2017
HK$
As at
31 December
2016
HK$
(in thousands)
(unaudited) (audited)
Within one year 367,639 337,946
After one year but not more than five years 636,956 738,535
1,004,595 1,076,481
As at 30 June 2017, the Group was committed to purchases of operating items totaling
HK$149.1 million (31 December 2016: HK$128.0 million).
89Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
16. LITIGATION
The Group did not have any material litigation outstanding as at 30 June 2017. The litigation
matters set out below are disclosed on a voluntary basis and, as with all litigation, no assurances
can be provided as to the outcome thereof.
Macau litigation related to Okada
WRM and certain individuals who are or were directors of WRM and/or the Company
(collectively, the “Wynn Macau Parties”) were named as defendants in a lawsuit filed in the
Court of First Instance of Macau (the “Macau Court”) by Mr. Kazuo Okada (“Okada”) and two of
Okada’s controlled companies, Aruze USA, Inc. and Universal Entertainment Corp. (collectively,
the “Okada Parties”). The principal allegations in the lawsuit were that the redemption of the
Okada Parties’ shares in WRL was improper and undervalued, that the previously disclosed
payment by WRM to an unrelated third party in consideration of relinquishment by that
party of certain rights in and to any future development on the land in Cotai where Wynn
Palace is located was unlawful and that the Company’s previously disclosed donation by
WRM to the University of Macau Development Foundation was unlawful. The Okada Parties
sought the dissolution of WRM and compensatory damages. The Company made a voluntary
announcement in respect of this lawsuit on 3 July 2015.
On 11 July 2017, the Macau Court dismissed all the claims made by the Okada Parties against
the Wynn Macau Parties as unfounded and imposed a fine of MOP41,500 (approximately
HK$40,000) on the Okada Parties for being vexatious litigants. In addition, the Macau Court
ordered the Okada Parties to pay Court fees and lawyer fees of the Wynn Macau Parties. As of
the date of this interim report we have not been notified of any appeal.
Macau litigation related to Dore
WRM has been named as a defendant in lawsuits filed in the Macau Court of First Instance by
individuals who claim to be investors in or persons with credit in accounts maintained by Dore
Entertainment Company Limited (“Dore”), an independent, Macau registered and licensed
company that operates a gaming promoter business at Wynn Macau. In connection with the
alleged theft, embezzlement, fraud and/or other crime(s) perpetrated by a former employee
of Dore (the “Dore Incident”), the plaintiffs of the lawsuits allege that Dore failed to honor
withdrawal of funds deposited with Dore as investments or gaming deposits that allegedly
resulted in certain losses for these individuals. The principal allegations common to the lawsuits
are that WRM, as a gaming concessionaire, should be held responsible for Dore’s conduct on
the basis that WRM is responsible for the supervision of Dore’s activities at Wynn Macau that
resulted in the purported losses.
The Company made a voluntary announcement in connection with the Dore Incident on 14
September 2015. The Company has sought advice from counsel in Macau, and based on such
advice, the Company believes the claims are devoid of merit and are unfounded. The Company
intends to vigorously defend WRM in the lawsuits.
90 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
17. RELATED PARTY DISCLOSURES
As at the end of the period, amounts due from/(to) related companies are unsecured, interest-
free and repayable on demand.
The Group had the following material connected transactions with related companies:
For the Six Months Ended
30 June
Name of Related
Companies
Relation to the
Company
Primary Nature
of Transactions
2017 2016
HK$ HK$
(in thousands)
(unaudited) (unaudited)
Wynn Resorts, Limited Ultimate parent
company
License fees (i) 656,084 366,109
Wynn Resorts, Limited Ultimate parent
company
Corporate support
services (ii)
55,749 44,032
Wynn Resorts, Limited Ultimate parent
company
Share-based
payment
expenses
21,572 32,923
Las Vegas Jet, LLC Subsidiary of Wynn
Resorts, Limited
Airplane usage
charges (ii)
1,985 9,564
WIML Subsidiary of Wynn
Resorts, Limited
International
marketing
expenses (iii)
25,419 11,932
Worldwide Wynn Subsidiary of Wynn
Resorts, Limited
Staff secondment
payroll charges
(iv)
101,656 131,225
Wynn Design &
Development
Subsidiary of Wynn
Resorts, Limited
Design/
development
payroll (v)
4,870 11,683
Wynn Design &
Development
Subsidiary of Wynn
Resorts, Limited
Acquisition of
artworks (vi)
— 263,118
91Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
17. RELATED PARTY DISCLOSURES (CONTINUED)
Except for the share-based payment expenses incurred with Wynn Resorts, Limited and the
acquisition of artworks from Wynn Design Development, all of the above transactions are noted
as continuing connected transactions.
Notes:
(i) License fees
The license fee payable to Wynn Resorts, Limited equals the greater of (1) 3% of the gross monthly
revenues of the intellectual property, and (2) US$1.5 million (approximately HK$11.7 million) per month.
(ii) Corporate support services
The annual fees for the services provided by Wynn Resorts are based on an allocation of the actual
proportion of Wynn Resorts’s annual corporate departments’ costs (including salaries and benefits for such
employees during the period in which such services are rendered) and overhead expense related to the
provision of such services, and in any event, such annual fees shall not exceed 50% of the aggregate annual
corporate departments’ costs and overhead expense incurred by Wynn Resorts during any financial year.
Wynn Resorts allows the Company and its employees to use aircraft assets owned by Wynn Resorts and its
subsidiaries (other than the Group) at hourly rates set by Las Vegas Jet, LLC, a subsidiary of Wynn Resorts.
(iii) International marketing expenses
These administrative, promotional and marketing services are provided through branch offices located in
various cities around the world under the direction and supervision provided by WIML. For the services
provided under this arrangement, WIML charges a service fee equal to the total costs it incurs in rendering
the services plus 5%.
(iv) Staff secondment payroll charges
Worldwide Wynn, a subsidiary of Wynn Resorts, is responsible for supplying management personnel
to WRM for pre-determined lengths of time through secondment arrangements. Worldwide Wynn is
compensated for these services of the seconded employees during the period of secondment to WRM with
a service fee equal to its aggregate costs plus 5%.
(v) Design/development payroll
Wynn Design & Development provides design and development services to the Group in connection with
the construction of Wynn Palace and renovation works at Wynn Macau and Encore and Wynn Palace. A
service fee is charged at the costs incurred by Wynn Design & Development to the Group for the services
provided.
(vi) Acquisition of artworks
On 29 June 2016, WRM entered into a purchase agreement with Wynn Design & Development to purchase
“Tulips” by Jeff Koons and “Amphora III” by Viola Frey for US$33,682,500 (approximately HK$262.3
million) and US$103,945 (approximately HK$0.8 million), respectively.
92 Wynn Macau, Limited
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
17. RELATED PARTY DISCLOSURES (CONTINUED)
The above transactions were carried out on terms mutually agreed between the Group and the
related companies. There were no significant charges from the Group to the related companies
during the six months ended 30 June 2017 and 2016. In the opinion of the Directors, the
related party transactions were conducted in the ordinary and usual course of the Group’s
business.
All such outstanding balances between the Group and the related companies are deemed to be
trade in nature.
Home Purchase
In May 2010, Worldwide Wynn entered into an employment agreement with Ms. Linda Chen,
who is also a director of the Company. Under the terms of the employment agreement,
Worldwide Wynn caused WRM to purchase a house in Macau for use by Ms. Chen. As at 30
June 2017, the net carrying amount of the house together with improvements and its land lease
right was HK$52.6 million (31 December 2016: HK$51.0 million).
WMLF Revolving Credit Facility
In connection with the WMLF Revolving Credit Facility, WRL pledged in favor of Bank of China
Limited, Macau Branch on 18 July 2016, its US$ deposits of initially up to US$200.0 million
(approximately HK$1.6 billion equivalent) in a pledged account at Bank of China Limited, Macau
Branch. On 25 October 2016, the WMLF Revolving Credit Facility was amended and upsized,
increasing the available borrowing capacity to HK$3.9 billion (approximately US $495.9 million).
As at 30 June 2017, the Group had no outstanding amounts under the WMLF Revolving Credit
Facility and WRL had no pledged deposits for WMLF Revolving Credit Facility. For further
details, refer to note 14 to the interim financial information.
93Interim Report 2017
Interim Financi a l Information
Notes to Interim Financi a l Information
For the six months ended 30 June 2017
18. FAIR VALUE AND FAIR VALUE HIERARCHY OF FINANCIAL INSTRUMENTS
Management has assessed that the fair values of cash and cash equivalents, restricted cash and
cash equivalents, trade and other receivables, deposits and other assets, accounts payable,
constructions and retentions payables, balances with related companies and the current portion
of financial liabilities included in other payables and accruals and other liabilities approximate
their carrying amounts largely due to the short term maturities of these instruments.
The fair values of the non-current portion of financial liabilities included in interest-bearing bank
loans have been calculated by discounting the expected future cash flows using rates currently
available for instruments with similar terms, credit risks and remaining maturities. The non-
current portion of financial liabilities included in other payables and accruals, other liabilities
and construction retentions payable were not discounted as the discounting factors were
considered by management to be insignificant.
As at 30 June 2017, the Group held one interest rate swap at fair value with asset measured
at fair value for level 2 of HK$0.9 million and two interest swaps at fair values with liabilities
measured at fair value for level 2 of HK$0.9 million (as at 31 December 2016, the Group held
three interest rate swaps at fair values with assets measured at fair value for level 2 of HK$8.2
million), and the Group measured its outstanding debt instruments at fair value for level 2 of
HK$30.2 billion (as at 31 December 2016: HK$32.3 billion). The Group did not hold any assets
or liabilities measured at fair value for levels 1 and 3 during the six months ended 30 June 2017
and 2016. Level 1 fair values are those measured using quoted prices (unadjusted) in active
markets for identical financial instruments, level 2 fair values measured using quoted prices
in active markets for similar financial instruments, or using valuation techniques in which all
significant input is directly or indirectly based on observable market data and level 3 fair values
are those measured using valuation techniques in which any significant input is not based on
observable market data.
94 Wynn Macau, Limited
Definitions
“Board of Directors” or “Board” the Board of Directors of our Company
“Code” the Corporate Governance Code and Corporate Governance
Report set out in Appendix 14 to the Listing Rules as applicable
on 30 June 2017
“Company” or “our Company” Wynn Macau, Limited, a company incorporated on 4 September
2009 as an exempted company with limited liability under the
laws of the Cayman Islands and an indirect subsidiary of Wynn
Resorts, Limited
“Concession Agreement” the Concession Contract for the Operation of Games of Chance
or Other Games in Casinos in the Macau Special Administrative
Region entered into between WRM and the Macau government
on 24 June 2002
“Cotai Land Concession
Agreement”
the land concession contract entered into between WRM, Palo
and the Macau government for approximately 51 acres of land
in the Cotai area of Macau, and for which formal approval from
the Macau government was published in the official gazette of
Macau on 2 May 2012
“Director(s)” the director(s) of our Company
“Encore” or “Encore at
Wynn Macau”
a casino resort located in Macau, connected to and fully
integrated with Wynn Macau, owned and operated directly by
WRM, which opened on 21 April 2010
“Galaxy” Galaxy Casino, S.A., one of the six gaming operators in Macau
and one of the three concessionaires
“Group”, “we”, “us” or “our“ our Company and its subsidiaries, or any of them, and the
businesses carried on by such subsidiaries, except where the
context makes it clear that the reference is only to the Company
itself and not to the Group
“HIBOR” Hong Kong Interbank Offered Rate
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong” the Hong Kong Special Administrative Region of the PRC
95Interim Report 2017
Definitions
“Hong Kong Stock Exchange” The Stock Exchange of Hong Kong Limited
“IFRS” International Financial Reporting Standards
“Las Vegas Jet, LLC” Las Vegas Jet, LLC, a company formed under the laws of the
State of Nevada, United States and a wholly-owned subsidiary
of Wynn Resorts, Limited
“LIBOR” London Interbank Offered Rate
“Listing Rules” the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (as amended from time to
time)
“Macau” or “Macau Special
Administrative Region”
the Macau Special Administrative Region of the PRC
“Macau Operations” the integrated Wynn Macau and Encore at Wynn Macau and
Wynn Palace
“Melco” Melco Crown (Macau) Limited, one of the six gaming operators
in Macau and one of the three sub-concessionaires
“MGM Macau” MGM Grand Paradise Limited, one of the six gaming operators
in Macau and one of the three sub-concessionaires
“Model Code” the Model Code for Securities Transactions by Directors of
Listed Issuers set out in Appendix 10 of the Listing Rules
“MOP” or “pataca” Macau pataca, the lawful currency of Macau
“NASDAQ Stock Market” National Association by Securities Dealers Automated
Quotations
“Palo Real Estate Company
Limited” or “Palo”
Palo Real Estate Company Limited, a limited liability company
incorporated under the laws of Macau, subject to Ms. Linda
Chen 10% social and voting interest and MOP1.00 economic
interest in WRM, an indirect wholly-owned subsidiary of the
Company
96 Wynn Macau, Limited
Definitions
“PRC”, “China” or
“mainland China”
the People’s Republic of China and, except where the context
requires and only for the purpose of this interim report,
references in this interim report to the PRC or China do not
include Taiwan, Hong Kong or Macau; the term “Chinese” has a
correlatives meaning
“SEC” the U.S. Securities and Exchange Commission
“SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws
of Hong Kong)
“Share(s)” ordinary share(s) with a nominal value of HK$0.001 each in the
share capital of our Company
“Shareholder(s)” holder(s) of Share(s) of the Company from time to time
“SJM” Sociedade de Jogos de Macau S.A., one of the six gaming
operators in Macau and one of the three concessionaires
“Trust” the trust constituted by the Trust Deed to service the employee
ownership scheme
“Trust Deed” the trust deed entered into between the Company and the
Trustee (as may be restated, supplemented and amended from
time to time) on 30 June 2014
“Trustee” the trustee appointed by the Company for the purpose of the
Trust, and as at the date of this interim report, Computershare
Hong Kong Trustees Limited, a company incorporated in Hong
Kong and having its registered office at 46th Floor, Hopewell
Centre, 183 Queen’s Road East, Wanchai, Hong Kong
“US$” United States dollars, the lawful currency of the United States
“U.S. GAAP” the Generally Accepted Accounting Principles of the United
States
“Venetian Macau” Venetian Macau S.A., one of the six gaming operators in Macau
and one of the three sub-concessionaires
97Interim Report 2017
Definitions
“WM Cayman Holdings Limited I” WM Cayman Holdings Limited I, a company incorporated on 7
July 2009 as an exempted company with limited liability under
the laws of the Cayman Islands and a wholly-owned subsidiary
of Wynn Group Asia, Inc.
“WM Cayman Holdings Limited II” WM Cayman Holdings Limited II, a company incorporated on 8
September 2009 as an exempted company with limited liability
under the laws of the Cayman Islands and a wholly-owned
subsidiary of the Company
“WML 2021 Notes” the US$600 million (approximately HK$4.7 billion) 5.25% senior
notes due 2021 issued by the Company in October 2013 and
the additional US$750 million (approximately HK$5.9 billion)
5.25% senior notes due 2021 issued by the Company on 20
March 2014 (Debt Stock Code: 5983), which were consolidated
to form one single series of notes
“WMLF” WML Finance I Limited, a limited liability company incorporated
under the laws of the Cayman Islands and an indirect wholly-
owned subsidiary of the Company
“WMLF Revolving Credit Facility” the HK$1.5 billion (approximately US$198.4 million) revolving
credit facility extended to WMLF on 18 July 2016 and the
principal amount was subsequently increased to HK$3.9 billion
(approximately US$495.9 million) on 25 October 2016
“Worldwide Wynn” Worldwide Wynn, LLC, a company formed under the laws of the
State of Nevada, United States and a wholly-owned subsidiary
of Wynn Resorts, Limited
“WRM” Wynn Resorts (Macau) S.A., a company incorporated under the
laws of Macau and a wholly-owned subsidiary of the Company
“WRM Shareholder Dividend
Tax Agreement”
the agreements, entered into during June 2009, August
2011 and August 2016, each for a term of five years between
WRM and the Macau Special Administrative Region, effective
retroactively to 2006, that provide for an annual payment to the
Macau Special Administrative Region of MOP7.2 million in years
2006 through 2010, MOP15.5 million in years 2011 through
2015 and MOP12.8 million in years 2016 through 2020 in lieu
of Complementary Tax otherwise due by WRM shareholders on
dividend distributions to them from gaming profits earned in
those years.
98 Wynn Macau, Limited
Definitions
“Wynn Design & Development” Wynn Design & Development, LLC, a company formed under
the laws of the State of Nevada, United States and a wholly-
owned subsidiary of Wynn Resorts, Limited
“Wynn Group Asia, Inc.” Wynn Group Asia, Inc, a company formed under the laws of the
State of Nevada, United States and a wholly-owned subsidiary
of Wynn Resorts, Limited
“Wynn International
Marketing, Ltd.” or “WIML”
Wynn International Marketing, Ltd., a company incorporated
under the laws of Isle of Man and a wholly-owned subsidiary of
Wynn Resorts, Limited
“Wynn Las Vegas, LLC” Wynn Las Vegas, LLC, a company formed under the laws of the
State of Nevada, United States and a wholly-owned subsidiary
of Wynn Resorts, Limited
“Wynn Macau” a casino hotel resort located in Macau, owned and operated
directly by WRM, which opened on 6 September 2006, and
where appropriate, the term also includes Encore at Wynn
Macau
“Wynn Macau Credit Facilities” together, the HK$18.0 billion (equivalent) fully-funded senior
term loan facilities and the HK$5.8 billion (equivalent) senior
revolving credit facilities extended to WRM on 30 September
2015
“Wynn Palace” an integrated resort situated on approximately 51 acres of land
in the Cotai area of Macau in accordance with the terms of the
Cotai Land Concession Agreement, which is operated by WRM
and opened on 22 August 2016
“Wynn Resorts International, Ltd.” Wynn Resorts International, Ltd., a company incorporated under
the laws of the Isle of Man and a wholly-owned subsidiary of the
Company
“Wynn Resorts, Limited”,
“Wynn Resorts” or “WRL”
Wynn Resorts, Limited, a company formed under the laws of the
State of Nevada, United States, and our controlling shareholder
(as defined in the Listing Rules)
99Interim Report 2017
Glossary
“Adjusted Average Daily Rate” adjusted average daily rate which is calculated by dividing
total room revenues including the retail value of promotional
allowances (less service charges, if any) by total rooms occupied
including complimentary rooms
“Adjusted REVPAR” adjusted revenue per available room which is calculated by
dividing total room revenues including the retail value of
promotional allowances (less service charges, if any) by total
rooms available
“casino revenue” revenue from casino gaming activities (gross table games win
and gross slot win), calculated net of a portion of commissions
and in accordance with IFRS
“chip(s)” a token; usually in the form of plastic disc(s) or plaque(s) issued
by a casino to customers in exchange for cash or credit, which
must be used (in lieu of cash) to place bets on gaming tables
“daily gross win per
gaming table”
gross gaming win for table games divided by number of tables
divided by the number of days in the applicable period
“gaming promoters” individuals or companies licensed by and registered with the
Macau government to promote games of fortune and chance
or other casino games to patrons, through the arrangement
of certain services, including transportation, accommodation,
dining and entertainment, whose activity is regulated by Macau
Administrative Regulation no. 6/2002
“gross gaming win” the total win generated by all casino gaming activities
combined, calculated before deduction of commissions
“gross slot win” the amount of handle (representing the total amount wagered)
that is retained as winnings. We record this amount and
gross table games win as casino revenue after deduction of
progressive jackpot liabilities and a portion of commissions
100 Wynn Macau, Limited
Glossary
“gross table games win” the amount of drop (in our general casino segment) or turnover
(in our VIP casino segment) that is retained as winnings. We
record this amount and gross slot win as casino revenue after
deduction of a portion of commissions
“In-house VIP Program” an internal marketing program wherein we directly market
our casino resorts to gaming clients, including to high-end
or premium players in the greater Asia region. These players
are invited to qualify for a variety of gaming rebate programs
whereby they earn cash commissions and room, food and
beverage and other complimentary allowances based on their
turnover level. We often extend credit to these players based
upon knowledge of the players, their financial background and
payment history
“promotional allowance” the retail value of rooms, food and beverage and retail and
other services furnished to guests (typically VIP clients) without
charge
“Rolling Chip” physically identifiable chip that is used to track VIP wagering
volume for purposes of calculating commissions and other
allowances payable to gaming promoters and our Macau
Operations’ individual VIP players
“table drop” the amount of cash deposited in a gaming table’s drop box that
serves as a repository for cash, plus cash chips purchased at the
casino cage
“turnover” the sum of all losing Rolling Chip wagers within the VIP program
“VIP client” or “VIP player” client, patron or player who participates in our Macau Operations’
In-house VIP Program or in the VIP program of any of our gaming
promoters
“VIP table games turnover” turnover resulting from VIP table games only
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