Moody’s Investors Service has revised the outlook for Wynn Macau Ltd and its parent companies, Wynn Resorts Finance LLC, and Wynn Resorts Ltd from negative to stable. The upgrade reflects the anticipation of a declining group leverage, driven by the ongoing recovery of the Macau gaming market.
Outlook Upgrade and Senior Unsecured Notes Rating:
The outlook for Wynn Macau Ltd and its parent companies has been upgraded from negative to stable, emphasizing the expectation of decreasing group leverage.
Wynn Macau’s senior unsecured notes rating has been upgraded from B2 to B1, signifying improved creditworthiness.
Market Recovery in Macau:
Moody’s anticipates a robust recovery in Macau’s gaming market following the removal of pandemic-related travel restrictions by China earlier this year.
The positive market outlook is expected to benefit the entire Wynn group, with Wynn Resorts Finance holding a 72.2% stake in Wynn Macau.
Credit Profile Support and Stable Ratings:
The group’s stable credit profile is underpinned by the quality and popularity of Wynn’s resort properties, setting it apart from other gaming operators.
Moody’s emphasizes Wynn’s well-established track record in building large, high-quality destination resorts.
Wynn’s liquidity and relatively low cost of debt capital contribute to maintaining stable ratings.
Expectations for Macau Operations:
Moody’s affirms Wynn Resorts Finance’s B1 Corporate Family Rating, expressing confidence in the expectation that Wynn Macau’s operations will continue recovering, reducing leverage to pre-pandemic levels.
Concerns and Considerations:
The considerable reliance on the Macau market is acknowledged, and Moody’s highlights the planned substantial investment in new markets, such as the UAE.
The group’s exposure to Macau and future debt-financed development projects, including the UAE integrated resort, may result in periods of increased leverage.
Moody’s positive outlook revision signifies the expected resilience and recovery of Wynn Macau Ltd and its parent companies within the evolving landscape of the Macau gaming market. While acknowledging potential challenges and the concentration of operations, the stable credit profile, reputation, and strategic initiatives position Wynn as a key player in the global integrated resort industry. As the Macau market rebounds, Wynn is poised for a period of renewed stability and growth.