Melco Announces Record Adjusted Property EBITDA in the Fourth Quarter 2018, Share Repurchase and Increase in Quarterly Divide...

Date : 02/19/2019 @ 1:17PM
Source : GlobeNewswire Inc.
Stock : Melco Resorts & Entertainment Limited ADS (MLCO)
Quote : 24.7  0.28 (1.15%) @ 9:11PM

Melco Announces Record Adjusted Property EBITDA in the Fourth Quarter 2018, Share Repurchase and Increase in Quarterly Divide...

Melco Resorts & Entertainment (NASDAQ:MLCO)
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Melco Resorts & Entertainment Limited (Nasdaq: MLCO) (“Melco” or the “Company”), a developer, owner and operator of casino gaming and entertainment casino resort facilities in Asia, today reported its unaudited financial results for the fourth quarter and full year ended December 31, 2018.

Net revenue for the fourth quarter of 2018 was US$1,396.5 million, representing an increase of approximately 5% from US$1,332.6 million for the comparable period in 2017. The increase in net revenue was primarily attributable to higher group-wide rolling chip and mass market table games gross gaming revenues, partially offset by higher commissions reported as a reduction in revenue upon the Company’s adoption of a new revenue recognition standard issued by the Financial Accounting Standards Board (the “New Revenue Standard”). The Company adopted the New Revenue Standard on January 1, 2018 under the modified retrospective method. Results for the periods beginning on or after January 1, 2018 are presented under the New Revenue Standard, while prior year amounts are not adjusted and continue to be reported in accordance with the previous basis. Under the previous basis, before the adoption of the New Revenue Standard, net revenue for the fourth quarter of 2018 would have been US$1,497.7 million, which would have represented an increase of approximately 12% from the US$1,332.6 million for the comparable period in 2017.

Operating income for the fourth quarter of 2018 was US$204.0 million, compared with operating income of US$129.0 million in the fourth quarter of 2017, representing an increase of 58%.

Adjusted property EBITDA(1) was US$425.2 million for the fourth quarter of 2018, as compared to Adjusted property EBITDA of US$339.8 million in the fourth quarter of 2017, representing an increase of 25%. The increase in Adjusted property EBITDA was mainly attributable to better performance in the group-wide rolling chip and mass market table games segments.

Net income attributable to Melco Resorts & Entertainment Limited for the fourth quarter of 2018 was US$128.0 million, or US$0.27 per ADS, compared with US$81.2 million, or US$0.17 per ADS, in the fourth quarter of 2017. The net income attributable to noncontrolling interests during the fourth quarter of 2018 was US$2.2 million and the net loss attributable to noncontrolling interests during the fourth quarter of 2017 was US$9.8 million, both of which were related to Studio City and City of Dreams Manila.

Mr. Lawrence Ho, our Chairman and Chief Executive Officer, commented, “Opening of the iconic, award-winning Morpheus, and the continued robust growth in Macau’s mass gaming market have allowed Melco to deliver record-level Property EBITDA despite the challenging macro environment.

“Melco’s dedication to excellence has been widely recognized, most recently by the Michelin Guide 2019 with the Company remaining as the leading integrated resort operator in the world with the most Michelin-starred restaurants. We are extremely proud to achieve a record-breaking milestone with six of Melco’s signature restaurants being awarded with a total of ten Michelin Stars. That includes Alain Ducasse at Morpheus, which was awarded with two Michelin Stars in less than six months after opening, and Jade Dragon in City of Dreams, which was awarded with three Michelin Stars.

“The opening of Morpheus only marks the beginning of the relaunch of City of Dreams. On top of that, we have recently unveiled the significantly upgraded VIP gaming spaces on the second floor of City of Dreams. Rolling refurbishment of Nüwa will also soon commence with the upgraded hotel rooms expected to come online over the next eighteen months.

“In January, the Macau government authorized Melco to operate 40 additional gaming tables at City of Dreams. We are sincerely thankful of the Macau government for its consideration and approval of our gaming table application.

“At Studio City, we continue to enhance the entertainment offerings with a series of property upgrades, which include the recent launch of the world’s most electrifying stunt show – Elekron. Earlier in January, we also opened the pop-up ‘Legend Heroes Park’, paving way for the opening of the permanent venue later in the year. Lastly, the ‘Flip Out’ Trampoline Park is expected to open in the first half of 2019.

“In the Philippines, City of Dreams Manila delivered another solid quarter underpinned by robust mass gaming revenue growth.

“The Board has, after evaluating the Company’s current liquidity position and future expected capital needs, decided to increase the quarterly cash dividend by 7% to US$0.0517 per ordinary share, which is equivalent to US$0.1551 per ADS, from the previous quarterly dividend of US$0.04835 per ordinary share. Since our third quarter results announcement, the Company has also repurchased approximately 10 million ADSs, worth approximately US$165 million, under the US$500 million share repurchase program the Company announced in November 2018.

“Lastly, Japan continues to be a core focus for us. We expect development of the next generation of integrated resorts to soon commence in this incredibly exciting, yet currently underpenetrated, tourism destination. With our focus on the Asian premium segment, high quality assets, dedication to world-class entertainment offerings, market-leading social safeguards and compliance culture, and our commitment to being an ideal partner to local governments and communities alike, we believe Melco is in a strong position to help Japan realize the vision for integrated resort development with a unique Japanese touch.”

City of Dreams Fourth Quarter Results

For the quarter ended December 31, 2018, net revenue at City of Dreams was US$724.5 million compared to US$612.6 million in the fourth quarter of 2017. City of Dreams generated Adjusted EBITDA of US$229.7 million in the fourth quarter of 2018 compared with Adjusted EBITDA of US$169.7 million in the fourth quarter of 2017. The year-on year increase in Adjusted EBITDA was primarily a result of better performances in the rolling chip and mass market table games segments.

Rolling chip volume totaled US$11.4 billion for both quarters ended December 31, 2018 and 2017. The rolling chip win rate was 3.2% in the fourth quarter of 2018 versus 2.7% in the fourth quarter of 2017. The expected rolling chip win rate range is 2.7%-3.0%.

Mass market table games drop increased to US$1,308.0 million in the fourth quarter of 2018 compared with US$1,226.0 million in the fourth quarter of 2017. The mass market table games hold percentage was 33.0% in the fourth quarter of 2018 compared to 28.6% in the fourth quarter of 2017.

Gaming machine handle for the fourth quarter of 2018 was US$1,051.8 million, compared with US$1,122.0 million in the fourth quarter of 2017. The gaming machine win rate was 3.7% in the fourth quarter of 2018 versus 4.2% in the fourth quarter of 2017.

Total non-gaming revenue at City of Dreams in the fourth quarter of 2018 was US$99.4 million, compared with US$71.9 million in the fourth quarter of 2017.

Altira Macau Fourth Quarter Results

For the quarter ended December 31, 2018, net revenue at Altira Macau was US$137.6 million compared to US$140.2 million in the fourth quarter of 2017. Altira Macau generated Adjusted EBITDA of US$20.2 million in the fourth quarter of 2018 compared with Adjusted EBITDA of US$17.5 million in the fourth quarter of 2017.

Rolling chip volume totaled US$6.5 billion in the fourth quarter of 2018 versus US$4.9 billion in the fourth quarter of 2017. The rolling chip win rate was 3.1% in the fourth quarter of 2018 versus 3.3% in the fourth quarter of 2017. The expected rolling chip win rate range is 2.7%-3.0%.

In the mass market table games segment, drop totaled US$127.1 million in the fourth quarter of 2018, representing an increase from US$125.2 million generated in the comparable period in 2017. The mass market table games hold percentage was 19.7% in the fourth quarter of 2018 compared with 18.4% in the fourth quarter of 2017.

Gaming machine handle for the fourth quarter of 2018 was US$29.9 million, compared with US$20.6 million in the fourth quarter of 2017. The gaming machine win rate was 4.3% in the fourth quarter of 2018 versus 6.0% in the fourth quarter of 2017.

Total non-gaming revenue at Altira Macau in the fourth quarter of 2018 was US$7.1 million, compared with US$7.0 million in the fourth quarter of 2017.

Mocha Clubs Fourth Quarter Results

Net revenue from Mocha Clubs totaled US$26.5 million in the fourth quarter of 2018 as compared to US$30.7 million in the fourth quarter of 2017. Mocha Clubs generated US$4.7 million of Adjusted EBITDA in the fourth quarter of 2018 compared with US$7.4 million in the same period in 2017.

Gaming machine handle for the fourth quarter of 2018 was US$593.9 million, compared with US$622.7 million in the fourth quarter of 2017. The gaming machine win rate was 4.5% in the fourth quarter of 2018 versus 4.8% in the fourth quarter of 2017.

Studio City Fourth Quarter Results

For the quarter ended December 31, 2018, net revenue at Studio City was US$340.7 million compared to US$369.0 million in the fourth quarter of 2017. Studio City generated Adjusted EBITDA of US$102.7 million in the fourth quarter of 2018 compared with Adjusted EBITDA of US$91.5 million in the fourth quarter of 2017.

Rolling chip volume totaled US$3.5 billion in the fourth quarter of 2018 versus US$5.7 billion in the fourth quarter of 2017. The rolling chip win rate was 3.8% in the fourth quarter of 2018 versus 2.8% in the fourth quarter of 2017. The expected rolling chip win rate range is 2.7%-3.0%.

Mass market table games drop decreased to US$825.4 million in the fourth quarter of 2018 compared with US$848.2 million in the fourth quarter of 2017. The mass market table games hold percentage was 27.0% in the fourth quarter of 2018 compared to 26.1% in the fourth quarter of 2017.

Gaming machine handle for the fourth quarter of 2018 was US$641.8 million, compared with US$539.0 million in the fourth quarter of 2017. The gaming machine win rate was 3.6% in the fourth quarter of 2018 versus 4.1% in the fourth quarter of 2017.

Total non-gaming revenue at Studio City in the fourth quarter of 2018 was US$46.4 million, compared with US$52.2 million in the fourth quarter of 2017.

City of Dreams Manila Fourth Quarter Results

For the quarter ended December 31, 2018, net revenue at City of Dreams Manila was US$155.2 million compared to US$167.5 million in the fourth quarter of 2017. City of Dreams Manila generated Adjusted EBITDA of US$67.9 million in the fourth quarter of 2018 compared to US$53.8 million in the comparable period of 2017. The year-on year increase in Adjusted EBITDA was mainly attributable to better performance in all gaming segments.

Rolling chip volume totaled US$2.4 billion in the fourth quarter of 2018 versus US$2.9 billion in the fourth quarter of 2017. The rolling chip win rate was 3.7% in the fourth quarter of 2018 versus 3.1% in the fourth quarter of 2017. The expected rolling chip win rate range is 2.7%-3.0%.

Mass market table games drop increased to US$197.3 million for the fourth quarter of 2018, compared with US$189.2 million in the fourth quarter of 2017. The mass market table games hold percentage was 31.4% in the fourth quarter of 2018 compared to 30.9% in the fourth quarter of 2017.

Gaming machine handle for the fourth quarter of 2018 was US$933.6 million, compared with US$793.3 million in the fourth quarter of 2017. The gaming machine win rate was 5.3% in the fourth quarter of 2018 versus 5.5% in the fourth quarter of 2017.

Total non-gaming revenue at City of Dreams Manila in the fourth quarter of 2018 was US$29.4 million, compared with US$31.4 million in the fourth quarter of 2017.            Other Factors Affecting Earnings

Total net non-operating expenses for the fourth quarter of 2018 were US$80.0 million, which mainly included interest expenses of US$74.0 million.

Depreciation and amortization costs of US$149.7 million were recorded in the fourth quarter of 2018 of which US$13.9 million was related to the amortization expense for our gaming subconcession and US$5.5 million was related to the amortization expense for the land use rights.

The Adjusted EBITDA for Studio City for the three months ended December 31, 2018 and year ended December 31, 2018 referred to in this report is US$17 million and US$61 million more, respectively, than the Adjusted EBITDA of Studio City contained in the earnings release for Studio City International Holdings Limited dated February 19, 2019 (the “Studio City earnings release”). The Adjusted EBITDA of Studio City contained in the Studio City earnings release includes certain intercompany charges that are not included in the Adjusted EBITDA for Studio City contained in this report. Such intercompany charges include, among other items, fees and shared service charges billed between Studio City International Holdings Limited and its subsidiaries and certain subsidiaries of Melco. Additionally, Adjusted EBITDA of Studio City included in this report does not reflect certain costs related to the VIP operations at Studio City Casino.

Financial Position and Capital Expenditures

Total cash and bank balances as of December 31, 2018 aggregated US$1.5 billion, including US$48.2 million of restricted cash, primarily related to Studio City. Total debt, net of unamortized deferred financing costs at the end of the fourth quarter of 2018, was US$4.1 billion.

Capital expenditures for the fourth quarter of 2018 were US$99.5 million, which predominantly related to various projects at City of Dreams and Studio City.

Full Year Results

For the year ended December 31, 2018, Melco Resorts & Entertainment Limited reported net revenue of US$5.2 billion versus US$5.3 billion in the prior year. The decrease in net revenue was primarily attributable to higher commissions reported as a reduction in revenue upon the Company’s adoption of the New Revenue Standard, partially offset by higher gross gaming revenues in all gaming segments. The Company adopted the New Revenue Standard on January 1, 2018 under the modified retrospective method. Results for the periods beginning on or after January 1, 2018 are presented under the New Revenue Standard, while prior year amounts are not adjusted and continue to be reported in accordance with the previous basis. Under the previous basis, before the adoption of the New Revenue Standard, net revenue for 2018 would have been US$5.6 billion, which would have represented an increase of approximately 5% from the US$5.3 billion for 2017.  

Operating income for 2018 was US$626.8 million, compared with operating income of US$607.6 million for 2017, representing an increase of 3%.

Adjusted property EBITDA for the year ended December 31, 2018 was US$1,477.9 million, as compared to Adjusted property EBITDA of US$1,422.8 million in 2017. The year-on-year improvement in Adjusted property EBITDA was mainly attributable to better group-wide performance in all gaming segments.

Net income attributable to Melco Resorts & Entertainment Limited for 2018 was US$351.5 million, or US$0.73 per ADS, compared with US$347.0 million, or US$0.71 per ADS, for 2017. The net income attributable to noncontrolling interests for 2018 was US$2.3 million and the net loss attributable to noncontrolling interests for 2017 was US$31.7 million, both of which were related to Studio City and City of Dreams Manila.

Amendment of Dividend Policy

To reaffirm Melco’s commitment to returning surplus capital to shareholders, our Board, after evaluating Melco’s current liquidity position and future expected capital needs, has amended its quarterly dividend policy from one targeting a quarterly cash dividend payment of US$0.04835 per ordinary share (equivalent to US$0.14505 per ADS, each representing three ordinary shares) of the Company to one targeting a quarterly cash dividend payment of US$0.0517 per ordinary share (equivalent to US$0.1551 per ADS) of the Company.

The new dividend policy will take effect beginning with any dividends declared by our Board for the fourth quarter of 2018 and continue until amended or otherwise determined by our Board. Distribution of dividends under this new dividend policy is subject to the Company’s accumulated and future earnings, cash availability and future commitments.

Our Board will continue to review our dividend policy from time to time as part of our commitment to maximizing shareholder value, taking into consideration our financial performance and market conditions.

Dividend Declaration

On February 19, 2019, our Board considered and approved the declaration and payment of a quarterly dividend of US$0.0517 per ordinary share (equivalent to US$0.1551 per ADS) for the fourth quarter of 2018 (the “Quarterly Dividend”). The Quarterly Dividend will be paid on or about March 14, 2019 to our shareholders whose names appear on the register of members of the Company at the close of business on March 4, 2019, being the record date for determination of entitlements to the Quarterly Dividend.

Conference Call Information

Melco Resorts & Entertainment Limited will hold a conference call to discuss its fourth quarter 2018 financial results on Tuesday, February 19, 2019 at 8:30 a.m. Eastern Time (9:30 p.m. Hong Kong Time). To join the conference call, please use the dial-in details below:

US Toll Free 1 866 519 4004
US Toll / International1 845 675 0437
HK Toll852 3018 6771
HK Toll Free800 906 601
Japan Toll 81 3 4503 6012
Japan Toll Free012 092 5376
UK Toll Free080 8234 6646
Australia Toll61 290 833 212
Australia Toll Free1 800 411 623
Philippines Toll Free 1 800 1612 0306
  
PasscodeMLCO

An audio webcast will also be available at http://www.melco-resorts.com.

To access the replay, please use the dial-in details below:

US Toll Free 1 855 452 5696 
US Toll / International1 646 254 3697
HK Toll Free 800 963 117
Japan Toll81 3 4580 6717
Japan Toll Free012 095 9034
Philippines Toll Free 1 800 1612 0166
  
Conference ID3567003

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Melco Resorts & Entertainment Limited (the “Company”) may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. These factors include, but are not limited to, (i) growth of the gaming market and visitations in Macau and the Philippines, (ii) capital and credit market volatility, (iii) local and global economic conditions, (iv) our anticipated growth strategies, (v) gaming authority and other governmental approvals and regulations, and (vi) our future business development, results of operations and financial condition. In some cases, forward-looking statements can be identified by words or phrases such as “may”, “will”, “expect”, “anticipate”, “target”, “aim”, “estimate”, “intend”, “plan”, “believe”, “potential”, “continue”, “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Non-GAAP Financial Measures

(1) “Adjusted EBITDA” is earnings before interest, taxes, depreciation, amortization, pre-opening costs, development costs, property charges and other, share-based compensation, payments to the Philippine parties under the cooperative arrangement (the “Philippine Parties”), land rent to Belle Corporation and other non-operating income and expenses. “Adjusted property EBITDA” is earnings before interest, taxes, depreciation, amortization, pre-opening costs, development costs, property charges and other, share-based compensation, payments to the Philippine Parties, land rent to Belle Corporation, Corporate and Other expenses and other non-operating income and expenses. Adjusted EBITDA and adjusted property EBITDA are presented exclusively as supplemental disclosures because management believes they are widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses adjusted EBITDA and adjusted property EBITDA as measures of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors. The Company also presents adjusted EBITDA and adjusted property EBITDA because they are used by some investors as ways to measure a company’s ability to incur and service debt, make capital expenditures, and meet working capital requirements. Gaming companies have historically reported adjusted EBITDA and adjusted property EBITDA as supplements to financial measures in accordance with U.S. GAAP. However, adjusted EBITDA and adjusted property EBITDA should not be considered as alternatives to operating income as indicators of the Company’s performance, as alternatives to cash flows from operating activities as measures of liquidity, or as alternatives to any other measure determined in accordance with U.S. GAAP. Unlike net income, adjusted EBITDA and adjusted property EBITDA do not include depreciation and amortization or interest expense and, therefore, do not reflect current or future capital expenditures or the cost of capital. The Company compensates for these limitations by using adjusted EBITDA and adjusted property EBITDA as only two of several comparative tools, together with U.S. GAAP measurements, to assist in the evaluation of operating performance.

Such U.S. GAAP measurements include operating income, net income, cash flows from operations and cash flow data. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other recurring and nonrecurring charges, which are not reflected in adjusted EBITDA or adjusted property EBITDA. Also, the Company’s calculation of adjusted EBITDA and adjusted property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted EBITDA and adjusted property EBITDA with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.

(2) “Adjusted net income” is net income before pre-opening costs, development costs, property charges and other, loss on extinguishment of debt and costs associated with debt modification, net of noncontrolling interests and taxes calculated using specific tax treatments applicable to the adjustments based on their respective jurisdictions. Adjusted net income attributable to Melco Resorts & Entertainment Limited and adjusted net income attributable to Melco Resorts & Entertainment Limited per share (“EPS”) are presented as supplemental disclosures because management believes they are widely used to measure the performance, and as a basis for valuation, of gaming companies. These measures are used by management and/or evaluated by some investors, in addition to income and EPS computed in accordance with U.S. GAAP, as an additional basis for assessing period-to-period results of our business. Adjusted net income attributable to Melco Resorts & Entertainment Limited and adjusted net income attributable to Melco Resorts & Entertainment Limited per share may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted net income attributable to Melco Resorts & Entertainment Limited with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.

About Melco Resorts & Entertainment Limited

The Company, with its American depositary shares listed on the NASDAQ Global Select Market (NASDAQ: MLCO), is a developer, owner and operator of casino gaming and entertainment casino resort facilities in Asia. The Company currently operates Altira Macau (www.altiramacau.com), a casino hotel located at Taipa, Macau and City of Dreams (www.cityofdreamsmacau.com), an integrated urban casino resort located in Cotai, Macau. Its business also includes the Mocha Clubs (www.mochaclubs.com), which comprise the largest non-casino based operations of electronic gaming machines in Macau. The Company also majority owns and operates Studio City (www.studiocity-macau.com), a cinematically-themed integrated entertainment, retail and gaming resort in Cotai, Macau. In the Philippines, a Philippine subsidiary of the Company currently operates and manages City of Dreams Manila (www.cityofdreams.com.ph), a casino, hotel, retail and entertainment integrated resort in the Entertainment City complex in Manila. For more information about the Company, please visit www.melco-resorts.com.

The Company is strongly supported by its single largest shareholder, Melco International Development Limited, a company listed on the Main Board of The Stock Exchange of Hong Kong Limited and is substantially owned and led by Mr. Lawrence Ho, who is the Chairman, Executive Director and Chief Executive Officer of the Company.

For investment community, please contact: Richard HuangDirector, Investor RelationsTel: +852 2598 3619Email: richardlshuang@melco-resorts.com

For media enquiries, please contact:

Chimmy LeungExecutive Director, Corporate CommunicationsTel: +852 3151 3765Email: chimmyleung@melco-resorts.com 

              
Melco Resorts & Entertainment Limited and Subsidiaries  
Condensed Consolidated Statements of Operations  
(In thousands of U.S. dollars, except share and per share data)  
              
 Three Months Ended Year Ended  
 December 31, December 31,  
 2018 2017 2018  2017   
  (Unaudited)  (Unaudited)  (Unaudited)  (Audited)  
              
OPERATING REVENUES             
Casino $   1,210,565   $   1,249,513   $   4,463,704   $   4,937,597   
Rooms   89,513     71,164     311,028     271,500   
Food and beverage   56,059     51,273     204,171     184,979   
Entertainment, retail and other   40,317     43,924     179,606     203,763   
Gross revenues   1,396,454     1,415,874     5,158,509     5,597,839   
Less: promotional allowances   -      (83,318)    -      (313,016)  
Net revenues   1,396,454     1,332,556     5,158,509     5,284,823   
              
OPERATING COSTS AND EXPENSES             
Casino   (795,606)    (865,064)    (2,984,711)    (3,374,013)  
Rooms   (22,590)    (8,389)    (78,377)    (32,641)  
Food and beverage   (44,955)    (16,056)    (161,126)    (57,927)  
Entertainment, retail and other   (21,600)    (21,612)    (92,436)    (88,268)  
General and administrative   (119,248)    (122,616)    (500,624)    (467,121)  
Payments to the Philippine Parties   (15,030)    (9,112)    (60,778)    (51,661)  
Pre-opening costs   (4,282)    (1,097)    (37,369)    (2,274)  
Development costs   (11,301)    (12,976)    (23,029)    (31,115)  
Amortization of gaming subconcession   (13,881)    (14,309)    (56,809)    (57,237)  
Amortization of land use rights   (5,534)    (5,705)    (22,646)    (22,817)  
Depreciation and amortization   (130,261)    (113,451)    (484,621)    (460,521)  
Property charges and other   (8,190)    (13,215)    (29,147)    (31,616)  
Total operating costs and expenses   (1,192,478)    (1,203,602)    (4,531,673)    (4,677,211)  
OPERATING INCOME   203,976     128,954     626,836     607,612   
NON-OPERATING INCOME (EXPENSES)             
Interest income   1,422     1,082     5,471     3,579   
Interest expenses, net of capitalized interest   (73,992)    (60,691)    (264,880)    (255,764)  
Other finance costs   (564)    (1,575)    (4,630)    (6,079)  
Foreign exchange (losses) gains, net   (4,253)    592     (9,612)    12,783   
Other income, net   670     3,024     3,682     5,282   
Loss on extinguishment of debt   (3,248)    (939)    (3,461)    (49,337)  
Costs associated with debt modification   -      -      -      (2,793)  
Total non-operating expenses, net   (79,965)    (58,507)    (273,430)    (292,329)  
INCOME BEFORE INCOME TAX   124,011     70,447     353,406     315,283   
INCOME TAX CREDIT    6,160     945     445     10   
NET INCOME   130,171     71,392     353,851     315,293   
NET (INCOME) LOSS ATTRIBUTABLE TO              
  NONCONTROLLING INTERESTS   (2,164)    9,780     (2,336)    31,709   
NET INCOME ATTRIBUTABLE TO              
  MELCO RESORTS & ENTERTAINMENT LIMITED $   128,007   $   81,172   $   351,515   $   347,002   
              
NET INCOME ATTRIBUTABLE TO              
  MELCO RESORTS & ENTERTAINMENT LIMITED PER SHARE:             
   Basic $  0.091  $  0.055  $  0.242  $  0.236   
   Diluted$  0.091  $  0.055  $  0.240  $  0.235   
              
NET INCOME ATTRIBUTABLE TO              
  MELCO RESORTS & ENTERTAINMENT LIMITED PER ADS:             
   Basic $  0.274  $  0.166  $  0.727  $  0.709   
   Diluted$  0.273  $  0.164  $  0.721  $  0.704   
              
WEIGHTED AVERAGE SHARES OUTSTANDING              
  USED IN NET INCOME ATTRIBUTABLE TO              
  MELCO RESORTS & ENTERTAINMENT LIMITED             
  PER SHARE CALCULATION:             
   Basic    1,399,181,661     1,469,344,163     1,451,051,051     1,467,653,209   
   Diluted   1,404,204,538     1,482,030,219     1,460,909,324     1,479,342,209   
              
Note: The Company adopted the New Revenue Standard on January 1, 2018 under the modified retrospective method. Results for the periods beginning on or after January 1, 2018 are presented under the New Revenue Standard, while prior year amounts are not adjusted and continue to be reported in accordance with the previous basis.  

        
Melco Resorts & Entertainment Limited and Subsidiaries  
Condensed Consolidated Balance Sheets  
(In thousands of U.S. dollars)  
        
        
 December 31, December 31,  
 2018  2017   
  (Unaudited)  (Audited)  
        
ASSETS       
        
CURRENT ASSETS       
Cash and cash equivalents $   1,436,558   $   1,408,211   
Investment securities   91,598     89,874   
Bank deposits with original maturities over three months   -      9,884   
Restricted cash   48,037     45,412   
Accounts receivable, net   242,089     176,544   
Amounts due from affiliated companies   7,603     2,377   
Inventories   40,828     34,988   
Prepaid expenses and other current assets   90,749     77,503   
Total current assets   1,957,462     1,844,793   
        
PROPERTY AND EQUIPMENT, NET   5,661,653     5,730,760   
GAMING SUBCONCESSION, NET   197,533     256,083   
INTANGIBLE ASSETS   30,072     4,220   
GOODWILL   81,376     81,915   
LONG-TERM PREPAYMENTS, DEPOSITS AND OTHER ASSETS   186,515     189,645   
RESTRICTED CASH   129     130   
DEFERRED TAX ASSETS   2,992     11   
LAND USE RIGHTS, NET   759,651     787,499   
TOTAL ASSETS $   8,877,383   $   8,895,056   
        
LIABILITIES AND SHAREHOLDERS' EQUITY       
        
CURRENT LIABILITIES       
Accounts payable $   24,879   $   16,041   
Accrued expenses and other current liabilities   1,658,550     1,563,585   
Income tax payable   4,903     3,179   
Capital lease obligations, due within one year    34,659     33,387   
Current portion of long-term debt, net   395,547     51,032   
Amounts due to affiliated companies   11,469     16,790   
Total current liabilities   2,130,007     1,684,014   
        
LONG-TERM DEBT, NET   3,665,370     3,506,530   
OTHER LONG-TERM LIABILITIES   28,866     48,087   
DEFERRED TAX LIABILITIES   54,063     53,994   
CAPITAL LEASE OBLIGATIONS, DUE AFTER ONE YEAR   253,374     265,896   
AMOUNTS DUE TO AFFILIATED COMPANIES   -      919   
        
SHAREHOLDERS' EQUITY       
Ordinary shares   14,830     14,784   
Treasury shares   (657,389)    (90)  
Additional paid-in capital   3,523,275     3,671,805   
Accumulated other comprehensive losses    (49,804)    (26,610)  
Accumulated losses   (703,576)    (772,338)  
Total Melco Resorts & Entertainment Limited shareholders’ equity   2,127,336     2,887,551   
Noncontrolling interests   618,367     448,065   
Total equity   2,745,703     3,335,616   
TOTAL LIABILITIES AND EQUITY $   8,877,383  $  8,895,056   
        

Melco Resorts & Entertainment Limited and Subsidiaries 
Reconciliation of Net Income Attributable to Melco Resorts & Entertainment Limited to  
Adjusted Net Income Attributable to Melco Resorts & Entertainment Limited 
(In thousands of U.S. dollars, except share and per share data) 
             
 Three Months Ended Year Ended 
 December 31, December 31, 
 2018  2017  2018  2017  
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
             
Net Income Attributable to             
  Melco Resorts & Entertainment Limited$  128,007  $  81,172  $  351,515  $  347,002  
Pre-opening Costs   4,282     1,097     37,369     2,274  
  Development Costs   11,301     12,976     23,029     31,115  
Property Charges and Other   8,190     13,215     29,147     31,616  
  Loss on Extinguishment of Debt   3,248     939     3,461     49,337  
  Costs Associated with Debt Modification   -      -      -      2,793  
  Income Tax Impact on Adjustments   (3,944)    (98)    (4,123)    (360) 
Noncontrolling Interests Impact on Adjustments   (3,871)    (7,932)    (5,741)    (10,606) 
Adjusted Net Income Attributable to             
  Melco Resorts & Entertainment Limited$  147,213  $  101,369  $  434,657  $  453,171  
             
ADJUSTED NET INCOME ATTRIBUTABLE TO            
  MELCO RESORTS & ENTERTAINMENT LIMITED PER SHARE:          
   Basic $  0.105  $  0.069  $  0.300  $  0.309  
   Diluted$  0.105  $  0.068  $  0.297  $  0.306  
             
ADJUSTED NET INCOME ATTRIBUTABLE TO            
  MELCO RESORTS & ENTERTAINMENT LIMITED PER ADS:            
   Basic $  0.316  $  0.207  $  0.899  $  0.926  
   Diluted$  0.314  $  0.205  $  0.892  $  0.919  
             
WEIGHTED AVERAGE SHARES OUTSTANDING             
  USED IN ADJUSTED NET INCOME ATTRIBUTABLE TO             
  MELCO RESORTS & ENTERTAINMENT LIMITED            
  PER SHARE CALCULATION:            
   Basic    1,399,181,661     1,469,344,163     1,451,051,051     1,467,653,209  
   Diluted   1,404,204,538     1,482,030,219     1,460,909,324     1,479,342,209  
             

Melco Resorts & Entertainment Limited and Subsidiaries 
Reconciliation of Operating Income (Loss) to Adjusted EBITDA and Adjusted Property EBITDA 
(In thousands of U.S. dollars) 
                      
                      
 Three Months Ended December 31, 2018 
 Altira Macau Mocha City of Dreams Studio City City of Dreams Manila Corporate and Other Total 
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
                      
Operating Income (Loss) $  14,591  $  2,050  $  165,786  $  56,174 $  25,825 $  (60,450) $  203,976 
                      
  Payments to the Philippine Parties   -      -      -      -     15,030    -      15,030 
  Land Rent to Belle Corporation   -      -      -      -     747    -      747 
  Pre-opening Costs   37     -      (33)    4,140    138    -      4,282 
  Development Costs   -      -      -      -     -     11,301     11,301 
  Depreciation and Amortization   5,185     2,181     63,175     41,569    18,680    18,886     149,676 
  Share-based Compensation   110     47     873     423    270    5,202     6,925 
  Property Charges and Other   238     454     (57)    377    7,181    (3)    8,190 
Adjusted EBITDA   20,161     4,732     229,744     102,683    67,871    (25,064)    400,127 
  Corporate and Other Expenses   -      -      -      -     -     25,064     25,064 
Adjusted Property EBITDA$  20,161   $   4,732   $   229,744   $   102,683  $   67,871  $   -    $   425,191 
                      
                      
 Three Months Ended December 31, 2017 
 Altira Macau Mocha City of Dreams Studio City City of Dreams Manila Corporate and Other Total 
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
                      
Operating Income (Loss)$  13,039  $  5,114  $  132,793  $  28,915 $  19,972 $  (70,879) $128,954 
                      
  Payments to the Philippine Parties   -      -      -      -     9,112    -      9,112 
  Land Rent to Belle Corporation   -      -      -      -     782    -      782 
  Pre-opening Costs   -      -      966     131    -     -    1,097 
  Development Costs   -      -      -      -     -     12,976     12,976 
  Depreciation and Amortization   4,975     2,090     40,782     46,081    21,042    18,495   133,465 
  Share-based Compensation   54     (73)    828     367    247    3,787   5,210 
  Property Charges and Other   (611)    305     (5,692)    15,981    2,638    594     13,215 
Adjusted EBITDA   17,457     7,436     169,677     91,475    53,793    (35,027)    304,811 
  Corporate and Other Expenses   -      -      -      -     -     35,027     35,027 
Adjusted Property EBITDA$  17,457   $   7,436   $   169,677   $   91,475  $   53,793  $   -    $   339,838 
                      

Melco Resorts & Entertainment Limited and Subsidiaries 
Reconciliation of Operating Income (Loss) to Adjusted EBITDA and Adjusted Property EBITDA 
(In thousands of U.S. dollars) 
                      
                      
 Year Ended December 31, 2018 
 Altira Macau Mocha City of Dreams Studio City City of Dreams Manila Corporate and Other Total 
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
                      
Operating Income (Loss) $  34,789  $  12,897 $  500,203 $  188,684 $  122,909  $  (232,646) $  626,836 
                      
  Payments to the Philippine Parties   -      -     -     -     60,778     -      60,778 
  Land Rent to Belle Corporation   -      -     -     -     3,001     -      3,001 
  Pre-opening Costs   37     -     32,624    4,550    158     -      37,369 
  Development Costs   -      -     -     -     -      23,029     23,029 
  Depreciation and Amortization   19,655     8,413    209,622    176,006    75,274     75,106     564,076 
  Share-based Compensation   388     158    3,472    1,577    (129)    19,677     25,143 
  Property Charges and Other   678     22    10,460    4,471    7,209     6,307     29,147 
Adjusted EBITDA   55,547     21,490    756,381    375,288    269,200     (108,527)    1,369,379 
  Corporate and Other Expenses   -      -     -     -     -      108,527     108,527 
Adjusted Property EBITDA$  55,547   $   21,490  $   756,381  $   375,288  $   269,200   $   -    $   1,477,906 
                      
                      
 Year Ended December 31, 2017 
 Altira Macau Mocha City of Dreams Studio City City of Dreams Manila Corporate and Other Total 
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
                      
Operating Income (Loss) $  (149) $  18,206 $  625,766 $  126,247 $  92,636  $  (255,094) $  607,612 
                      
  Payments to the Philippine Parties   -      -     -     -     51,661     -      51,661 
  Land Rent to Belle Corporation   -      -     -     -     3,143     -      3,143 
  Pre-opening Costs   -      -     1,933    116    225     -      2,274 
  Development Costs   -      -     -     -     -      31,115     31,115 
  Depreciation and Amortization   20,973     8,312    171,216    184,456    84,200     71,418     540,575 
  Share-based Compensation   204     24    2,934    1,294    516     12,333     17,305 
  Property Charges and Other   (357)    97    3,023    23,455    2,638     2,760     31,616 
Adjusted EBITDA   20,671     26,639    804,872    335,568    235,019     (137,468)    1,285,301 
  Corporate and Other Expenses   -      -     -     -     -      137,468     137,468 
Adjusted Property EBITDA$  20,671   $   26,639  $   804,872  $   335,568  $   235,019   $   -    $   1,422,769 
                      

Melco Resorts & Entertainment Limited and Subsidiaries 
Reconciliation of Net Income Attributable to Melco Resorts & Entertainment Limited to 
Adjusted EBITDA and Adjusted Property EBITDA 
(In thousands of U.S. dollars) 
             
 Three Months Ended Year Ended 
 December 31, December 31, 
 2018  2017  2018  2017  
 (Unaudited) (Unaudited) (Unaudited) (Unaudited) 
             
Net Income Attributable to Melco Resorts & Entertainment Limited$  128,007  $81,172  $  351,515  $  347,002  
Net Income (Loss) Attributable to Noncontrolling Interests   2,164     (9,780)    2,336     (31,709) 
Net Income   130,171     71,392     353,851     315,293  
Income Tax Credit    (6,160)    (945)    (445)    (10) 
Interest and Other Non-Operating Expenses, Net   79,965     58,507     273,430     292,329  
Property Charges and Other   8,190     13,215     29,147     31,616  
Share-based Compensation   6,925     5,210     25,143     17,305  
Depreciation and Amortization   149,676     133,465     564,076     540,575  
Development Costs   11,301     12,976     23,029     31,115  
Pre-opening Costs   4,282     1,097     37,369     2,274  
Land Rent to Belle Corporation   747     782     3,001     3,143  
Payments to the Philippine Parties   15,030     9,112     60,778     51,661  
Adjusted EBITDA   400,127     304,811     1,369,379     1,285,301  
Corporate and Other Expenses 25,064   35,027     108,527     137,468  
Adjusted Property EBITDA$  425,191  $  339,838  $  1,477,906  $  1,422,769  
             

              
 Melco Resorts & Entertainment Limited and Subsidiaries 
 Supplemental Data Schedule 
              
      Three Months Ended Year Ended 
      December 31,  December 31,  
       2018   2017   2018   2017  
Room Statistics:           
 Altira Macau           
  Average daily rate (3)  $  188  $  209  $  189  $  204  
  Occupancy per available room   100%  99%  99%  96% 
  Revenue per available room (4)  $  188  $  207  $  188  $  196  
              
 City of Dreams           
  Average daily rate (3)  $  222  $  209  $  212  $  202  
  Occupancy per available room   97%  97%  97%  97% 
  Revenue per available room (4)  $  216  $  202  $  206  $  196  
              
 Studio City           
  Average daily rate (3)  $  138  $  145  $  138  $  140  
  Occupancy per available room   100%  99%  100%  99% 
  Revenue per available room (4)  $  138  $  144  $  138  $  138  
              
 City of Dreams Manila          
  Average daily rate (3)  $  162  $  163  $  159  $  158  
  Occupancy per available room   98%  97%  98%  96% 
  Revenue per available room (4)  $  159  $  158  $  156  $  152  
              
Other Information:           
 Altira Macau           
  Average number of table games    103     103     104     107  
  Average number of gaming machines    136     120     129     73  
  Table games win per unit per day (5) $  23,849  $  19,358  $  20,546  $  15,478  
  Gaming machines win per unit per day (6) $  102  $  112  $  137  $  106  
              
 City of Dreams           
  Average number of table games    477     479     476     479  
  Average number of gaming machines    774     712     724     746  
  Table games win per unit per day (5) $  18,187  $  15,013  $  16,257  $  16,408  
  Gaming machines win per unit per day (6) $  547  $  726  $  737  $  557  
              
 Studio City           
  Average number of table games    293     293     292     288  
  Average number of gaming machines    987     883     957     951  
  Table games win per unit per day (5) $  13,233  $  14,123  $  14,076  $  12,932  
  Gaming machines win per unit per day (6) $  254  $  272  $  240  $  225  
              
 City of Dreams Manila          
  Average number of table games    301     291     300     283  
  Average number of gaming machines    2,057     1,800     1,929     1,786  
  Table games win per unit per day (5) $  5,408  $  5,473  $  5,536  $  5,432  
  Gaming machines win per unit per day (6) $  261  $  265  $  278  $  271  
              
  (3) Average daily rate is calculated by dividing total room revenues including the retail value of complimentary rooms (less service charges, if any) by total occupied rooms including complimentary rooms  
  (4) Revenue per available room is calculated by dividing total room revenues including the retail value of complimentary rooms (less service charges, if any) by total rooms available 
  (5) Table games win per unit per day is shown before discounts, commissions, non-discretionary incentives (including our point-loyalty programs) and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis 
  (6) Gaming machines win per unit per day is shown before non-discretionary incentives (including our point-loyalty programs) and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis 

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