Press Releases

MACAU, Oct. 30, 2019 (GLOBE NEWSWIRE) -- Studio City International Holdings Limited (NYSE: MSC) (“Studio City” or the “Company”), a world-class gaming, retail and entertainment resort located in Cotai, Macau, today reported its unaudited financial results for the third quarter of 2019.

Total operating revenues for the third quarter of 2019 were US$158.1 million, as compared to US$143.8 million in the third quarter of 2018. The increase in total operating revenues was mainly due to the increase in revenues from the provision of gaming related services.

Revenues from the provision of gaming related services are derived from the provision of facilities for the operations of Studio City Casino by Melco Resorts (Macau) Limited (the “Gaming Operator”), a subsidiary of Melco Resorts & Entertainment Limited (“Melco”) and holder of a gaming subconcession, and services related thereto.

Studio City Casino generated gross gaming revenues of US$345.6 million and US$397.9 million for the third quarters of 2019 and 2018, respectively. Affected by the Macau market-wide VIP weakness, Studio City’s rolling chip volume totaled US$2.77 billion for the third quarter of 2019 versus US$5.09 billion in the third quarter of 2018. The rolling chip win rate was 2.71% in the third quarter of 2019 versus 3.12% in the third quarter of 2018. The expected rolling chip win rate range is 2.85% - 3.15%.

Mass market table games drop increased to US$880.6 million in the third quarter of 2019 compared with US$807.9 million in the third quarter of 2018. The mass market table games hold percentage was 28.4% in the third quarter of 2019 compared to 27.2% in the third quarter of 2018.

Gaming machine handle for the third quarter of 2019 was US$711.2 million, compared with US$641.6 million in the third quarter of 2018. The gaming machine win rate was 2.8% in the third quarter of 2019 compared to 2.9% in the third quarter of 2018.

Total gaming taxes and the costs incurred in connection with the operation of Studio City Casino deducted from gross gaming revenues were US$248.9 million and US$315.9 million in the third quarters of 2019 and 2018, respectively.

Revenues from the provision of gaming related services were US$96.7 million and US$82.0 million for the third quarters of 2019 and 2018, respectively. Revenues from the provision of gaming related services are net of gaming taxes and the costs incurred in connection with the operation of Studio City Casino deducted by the Gaming Operator pursuant to the Services and Right to Use Arrangements.

Total non-gaming revenues at Studio City for the third quarter of 2019 was US$61.4 million, compared with US$61.8 million for the third quarter of 2018.

Operating income for the third quarter of 2019 was US$47.6 million, compared with operating income of US$31.4 million in the third quarter of 2018, representing an increase of 52%.

Adjusted EBITDA⁽¹⁾ was US$90.9 million for the third quarter of 2019, as compared to Adjusted EBITDA of US$75.2 million in the third quarter of 2018, representing an increase of 21%. The year-over-year increase in Adjusted EBITDA was mainly attributable to the increase in revenues from the provision of gaming related services.

Net income attributable to Studio City International Holdings Limited for the third quarter of 2019 was US$14.3 million, compared with net loss attributable to Studio City International Holdings Limited of US$8.1 million in the third quarter of 2018. The net income attributable to participation interest for the third quarter of 2019 was US$4.3 million.  

Other Factors Affecting Earnings

Total net non-operating expenses for the third quarter of 2019 were US$28.9 million, which mainly included interest expenses of US$33.4 million, partially offset by interest income of US$2.7 million.

Depreciation and amortization costs of US$43.6 million were recorded in the third quarter of 2019 of which US$0.8 million was related to the amortization expense for the land use right.

In January 2019, the Gaming Operator informed us via our subsidiary, Studio City Entertainment Limited, that it will cease VIP rolling chip operations at the Studio City Casino on January 15, 2020. Revenues from provision of gaming related services in relation to the Studio City Casino VIP gaming operations amounted to US$6.0 million in the third quarter of 2019, compared with US$12.3 million in the third quarter of 2018.

The Adjusted EBITDA for Studio City for the three months ended September 30, 2019 referred to in Melco’s earnings release dated October 30, 2019 (“Melco’s earnings release”) is US$15.5 million more than the Adjusted EBITDA of Studio City contained in this press release. The Adjusted EBITDA of Studio City contained in this press release includes certain intercompany charges that are not included in the Adjusted EBITDA for Studio City contained in Melco’s earnings release. Such intercompany charges include, among other items, fees and shared service charges billed between the Company and its subsidiaries and certain subsidiaries of Melco. Additionally, Adjusted EBITDA of Studio City included in Melco’s earnings release 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 September 30, 2019 aggregated US$671.1 million (December 31, 2018: US$377.6 million), including US$50.0 million of restricted cash (December 31, 2018: US$31.7 million). Total debt, net of unamortized deferred financing costs at the end of the third quarter of 2019, was US$1.78 billion (December 31, 2018: US$1.61 billion).

Capital expenditures for the third quarter of 2019 were US$14.8 million.

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. Studio City International Holdings 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, (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 defined as earnings before interest, taxes, depreciation, amortization, pre-opening costs, property charges and other, other non-operating income and expenses. We believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results. This non-GAAP financial measure eliminates the impact of items that we do not consider indicative of the performance of our business. While we believe that this non-GAAP financial measure is useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared in accordance with U.S. GAAP. It should not be considered in isolation or construed as an alternative to net income/loss, cash flow or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. The use of Adjusted EBITDA has material limitations as an analytical tool, as Adjusted EBITDA does not include all items that impact our net income/loss. In addition, the Company’s calculation of Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measure to its most directly comparable GAAP financial measure. Reconciliations of Adjusted 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/loss” is net income/loss before pre-opening costs, property charges and other, loss on extinguishment of debt and costs associated with debt modification, net of participation interest. Adjusted net income/loss is presented as supplemental disclosure because management believes it provides useful information to investors and others in understanding and evaluating our performance, in addition to income/loss computed in accordance with U.S. GAAP. Adjusted net income/loss may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted net income/loss 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 Studio City International Holdings Limited

The Company, with its American depositary shares listed on the New York Stock Exchange (NYSE: MSC), is a world-class gaming, retail and entertainment resort located in Cotai, Macau. For more information about the Company, please visit www.studiocity-macau.com.

The Company is strongly supported by its single largest shareholder, Melco Resorts & Entertainment Limited, a company with its American depositary shares listed on the NASDAQ Global Select Market (NASDAQ: MLCO). 

For investment community, please contact:
Richard Huang
Director, Investor Relations
Tel: +852 2598 3619
Email: richardlshuang@melco-resorts.com

For media enquiries, please contact:
Chimmy Leung
Executive Director, Corporate Communications
Tel: +852 3151 3765
Email: chimmyleung@melco-resorts.com

 

 

Studio City International Holdings Limited and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands of U.S. dollars, except share and per share data)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
OPERATING REVENUES
Provision of gaming related services	$	96,689			$	82,028			$	288,225			$	250,623
Rooms		21,872				22,653				63,822				66,236
Food and beverage		17,180				17,419				51,970				48,878
Entertainment		5,452				4,370				15,535				10,643
Services fee		10,514				10,775				29,892				30,381
Mall		5,827				5,668				7,753				16,366
Retail and other		567				916				1,717				2,872
Total operating revenues		158,101				143,829				458,914				425,999
OPERATING COSTS AND EXPENSES
Provision of gaming related services		(5,719	)			(5,073	)			(17,353	)			(15,829	)
Rooms		(5,497	)			(5,561	)			(16,230	)			(16,515	)
Food and beverage		(14,163	)			(14,400	)			(43,489	)			(41,770	)
Entertainment		(4,051	)			(3,637	)			(17,271	)			(10,523	)
Mall		(2,069	)			(2,944	)			(7,076	)			(8,326	)
Retail and other		(443	)			(609	)			(1,345	)			(1,883	)
General and administrative		(35,211	)			(36,435	)			(98,470	)			(102,290	)
Pre-opening costs		(6	)			(357	)			(2,555	)			(410	)
Amortization of land use right		(825	)			(831	)			(2,473	)			(2,492	)
Depreciation and amortization		(42,744	)			(42,023	)			(128,821	)			(125,806	)
Property charges and other		256				(560	)			(8,069	)			(4,087	)
Total operating costs and expenses		(110,472	)			(112,430	)			(343,152	)			(329,931	)
OPERATING INCOME		47,629				31,399				115,762				96,068
NON-OPERATING INCOME (EXPENSES)
Interest income		2,691				977				4,652				2,416
Interest expenses		(33,392	)			(40,150	)			(100,800	)			(120,334	)
Loan commitment fees		(104	)			(106	)			(311	)			(314	)
Foreign exchange gains (losses), net		2,003				(135	)			702				(297	)
Other (expenses) income, net		(87	)			(88	)			518				(110	)
Loss on extinguishment of debt		-				-				(2,995	)			-
Costs associated with debt modification		-				-				(579	)			-
Total non-operating expenses, net		(28,889	)			(39,502	)			(98,813	)			(118,639	)
INCOME (LOSS) BEFORE INCOME TAX		18,740				(8,103	)			16,949				(22,571	)
INCOME TAX (EXPENSE) CREDIT		(201	)			9				(344	)			(366	)
NET INCOME (LOSS)		18,539				(8,094	)			16,605				(22,937	)
NET INCOME ATTRIBUTABLE TO PARTICIPATION INTEREST		(4,278	)			-				(3,831	)			-
NET INCOME (LOSS) ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED	$	14,261			$	(8,094	)		$	12,774			$	(22,937	)
NET INCOME (LOSS) ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED
PER CLASS A ORDINARY SHARE:
Basic and diluted	$	0.059			$	(0.045	)		$	0.053			$	(0.127	)
NET INCOME (LOSS) ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED PER ADS:
Basic and diluted	$	0.236			$	(0.179	)		$	0.211			$	(0.506	)
WEIGHTED AVERAGE CLASS A ORDINARY SHARES
OUTSTANDING USED IN NET INCOME (LOSS) ATTRIBUTABLE TO STUDIO CITY INTERNATIONAL HOLDINGS LIMITED PER CLASS A ORDINARY SHARE CALCULATION:
Basic and diluted		241,818,016				181,279,400				241,818,016				181,279,400
Note:
In connection with the Company's initial public offering (the "IPO") on October 22, 2018, the Company underwent a series of organizational transactions. For the preparation of the accompanying unaudited condensed consolidated financial statements and the calculation of net income (loss) attributable to Studio City International Holdings Limited per Class A ordinary share for the periods prior to the IPO, the Company has retrospectively presented net income (loss) attributable to Studio City International Holdings Limited per Class A ordinary share and the share capital as if the organizational transactions had occurred at the beginning of the earliest period presented. Such retrospective presentation reflects the redesignation of the issued 18,127.94 ordinary shares of $1 par value each to 181,279,400 Class A ordinary shares of $0.0001 par value each. For the periods prior to the IPO date, the retrospective presentation does not include the exchange of 72,511,760 Class A ordinary shares into 72,511,760 Class B ordinary shares of $0.0001 par value each and the issuance of 115,000,000 Class A ordinary shares in the IPO.

 

Studio City International Holdings Limited and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands of U.S. dollars)
	September 30,				December 31,
	2019				2018
	(Unaudited)				(Audited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	621,091			$	345,854
Restricted cash		49,847				31,582
Accounts receivable, net		946				1,712
Amounts due from affiliated companies		53,402				42,339
Inventories		9,606				9,904
Prepaid expenses and other current assets		12,147				27,650
Total current assets		747,039				459,041
PROPERTY AND EQUIPMENT, NET		2,092,851				2,175,858
LONG-TERM PREPAYMENTS, DEPOSITS AND OTHER ASSETS		38,602				45,766
RESTRICTED CASH		129				129
OPERATING LEASE RIGHT-OF-USE ASSETS		14,237				-
LAND USE RIGHT, NET		118,924				121,544
TOTAL ASSETS	$	3,011,782			$	2,802,338
LIABILITIES, SHAREHOLDERS' EQUITY AND
PARTICIPATION INTEREST
CURRENT LIABILITIES
Accounts payable	$	5,239			$	6,421
Accrued expenses and other current liabilities		78,630				62,825
Income tax payable		33				33
Current portion of long-term debt, net		349,583				347,740
Amounts due to affiliated companies		15,380				21,953
Total current liabilities		448,865				438,972
LONG-TERM DEBT, NET		1,433,826				1,261,904
OTHER LONG-TERM LIABILITIES		4,652				4,017
DEFERRED TAX LIABILITIES		1,386				1,044
OPERATING LEASE LIABILITIES, NON-CURRENT		13,393				-
TOTAL LIABILITIES		1,902,122				1,705,937
SHAREHOLDERS’ EQUITY AND PARTICIPATION INTEREST
Class A ordinary shares		24				24
Class B ordinary shares		7				7
Additional paid-in capital		1,655,602				1,655,602
Accumulated other comprehensive losses		(16,637	)			(14,063	)
Accumulated losses		(785,324	)			(798,098	)
Total shareholders’ equity		853,672				843,472
PARTICIPATION INTEREST		255,988				252,929
Total shareholders’ equity and participation interest		1,109,660				1,096,401
TOTAL LIABILITIES, SHAREHOLDERS' EQUITY
AND PARTICIPATION INTEREST	$	3,011,782			$	2,802,338

 

Studio City International Holdings Limited and Subsidiaries
Reconciliation of Net Income (Loss) Attributable to Studio City International Holdings Limited to
Adjusted Net Income (Loss) Attributable to Studio City International Holdings Limited
(In thousands of U.S. dollars, except share and per share data)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Net Income (Loss) Attributable to
Studio City International Holdings Limited	$	14,261			$	(8,094	)		$	12,774			$	(22,937	)
Pre-opening Costs		6				357				2,555				410
Property Charges and Other		(256	)			560				8,069				4,087
Loss on Extinguishment of Debt		-				-				2,995				-
Costs Associated with Debt Modification		-				-				579				-
Participation Interest Impact on Adjustments		58				-				(3,275	)			-
Adjusted Net Income (Loss) Attributable to
Studio City International Holdings Limited	$	14,069			$	(7,177	)		$	23,697			$	(18,440	)
ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED
PER CLASS A ORDINARY SHARE:
Basic and diluted	$	0.058			$	(0.040	)		$	0.098			$	(0.102	)
ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED
PER ADS:
Basic and diluted	$	0.233			$	(0.158	)		$	0.392			$	(0.407	)
WEIGHTED AVERAGE CLASS A ORDINARY SHARES
OUTSTANDING USED IN ADJUSTED NET INCOME (LOSS)
ATTRIBUTABLE TO
STUDIO CITY INTERNATIONAL HOLDINGS LIMITED
PER CLASS A ORDINARY SHARE CALCULATION:
Basic and diluted		241,818,016				181,279,400				241,818,016				181,279,400

 

Studio City International Holdings Limited and Subsidiaries
Reconciliation of Operating Income to Adjusted EBITDA
(In thousands of U.S. dollars)
	Three Months Ended							Nine Months Ended
	September 30,							September 30,
	2019				2018			2019			2018
	(Unaudited)				(Unaudited)			(Unaudited)			(Unaudited)
Operating Income	$	47,629			$	31,399		$	115,762		$	96,068
Pre-opening Costs		6				357			2,555			410
Depreciation and Amortization		43,569				42,854			131,294			128,298
Property Charges and Other		(256	)			560			8,069			4,087
Adjusted EBITDA	$	90,948			$	75,170		$	257,680		$	228,863

 

Studio City International Holdings Limited and Subsidiaries
Reconciliation of Net Income (Loss) Attributable to Studio City International Holdings Limited to Adjusted EBITDA
(In thousands of U.S. dollars)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2019				2018				2019			2018
	(Unaudited)				(Unaudited)				(Unaudited)			(Unaudited)
Net Income (Loss) Attributable to
Studio City International Holdings Limited	$	14,261			$	(8,094	)		$	12,774		$	(22,937	)
Net Income Attributable to Participation Interest		4,278				-				3,831			-
Net Income (Loss)		18,539				(8,094	)			16,605			(22,937	)
Income Tax Expense (Credit)		201				(9	)			344			366
Interest and Other Non-Operating Expenses, Net		28,889				39,502				98,813			118,639
Property Charges and Other		(256	)			560				8,069			4,087
Depreciation and Amortization		43,569				42,854				131,294			128,298
Pre-opening Costs		6				357				2,555			410
Adjusted EBITDA	$	90,948			$	75,170			$	257,680		$	228,863

 

Studio City International Holdings Limited and Subsidiaries
Supplemental Data Schedule
						Three Months Ended								Nine Months Ended
						September 30,								September 30,
						2019				2018				2019				2018
Room Statistics:
		Average daily rate (3)				$	135			$	141			$	134			$	138
		Occupancy per available room					100	%			100	%			100	%			100	%
		Revenue per available room (4)				$	135			$	141			$	134			$	138
Other Information:
		Average number of table games					292				288				293				292
		Average number of gaming machines					896				938				952				947
		Table games win per unit per day (5)				$	12,126			$	14,287			$	12,481			$	14,361
		Gaming machines win per unit per day (6)				$	243			$	219			$	226			$	235
		(3) Average daily rate is calculated by dividing total room revenues including 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 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 the point-loyalty programs) as administered by the Gaming Operator 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 the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis

 

 

 

Source: Studio City International Holdings Limited