Welcome to the Wynn Resort Third Quarter 2014 Earnings Call. I will now turn the conference over to Mr. Louis Banger, Vice President of Wynn Resort. Please go ahead.
Good afternoon, everyone. Welcome to the Wynn Resorts Q3 2014 earnings call. Joining the call on behalf of the company today are Steve Wynn, Matt Maddox, John Stremp, Steve Coote, Maurice Wooden and Scott Peterson here in Las Vegas, as well as Gamala Z, Ian Collin, Frederic Luvisuto, Linda Chen, Robert Gansmo and Frank Casella dialing in from Wynn Macau. And with that said, let me turn it over to Matt.
Okay. Thanks everyone. Before we get started, I just need to remind everybody that we will be making forward looking statements on this call and those statements may or may not come true. With that, I'm going to turn it over to Mr. Winn.
Generally speaking, we were happy with the last quarter rather we made up in the slot machines in the general casino in Macau in Mass what we lost in VIP. And so it seems to me as we look at October that we're definitely you've got to love Macau. We do in this company and we have great, great confidence and gratitude to be involved with the place. But it's always been government sensitive. And the turmoil in Hong Kong, the smoking the new regulations of smoking, the turmoil in Hong Kong lately in the month of October, and of course, the policy of the central government and being very, very aggressive about what appeared to be misconduct in corruption of the government has put a lot of the wealthy businessmen in the foxholes.
Everybody's being very conservative at this point over there. I think taking the cue from President And I don't know whether it's a squall or we're in the rainy season or how long it'll last, but we're still very, very bullish on Macau. And as usual in the past when people used to ask us when are you going to get approval to start construction, when will you get your land concession, You things happen in China at their own pace and in their own time. And for those of us who are lucky enough to be in business there, you have to sit there and go but we but we're on target, we're on budget, we're on time. And Wynn Palace is proceeding.
We think that it's going to be a very wonderful addition to the market in terms of attracting people to Macau like as in the case of our competitors. Everything that's being built lately is even better than what has been built before. The community's social profile is being lifted. The quality of the the quality of the products that are being offered in terms of hospitality, non gaming, food, beverage, entertainment and meeting and conventions all the rest get better and better as that town takes advantage of its competitive superiority. With regard to Las Vegas, we were very happy with this quarter.
It's a continuation of what we've seen in the past. All of our metrics have improved. For the previous for the running 12 months, I think our EBITDA was $520 odd 1,000,000 And if we can hold on during the Q4, we ought to be able to get to the 5, I hope, calendar year this year. That's pretty much my comments about the status of our business. We did increase if you've noticed, we've increased our regular dividend effective immediately to $1.50 a quarter.
We want to stay very conservative. As you know, we have a tremendous focus on our balance sheet. And we've made our special dividend $1 and elected instead to increase the regular dividend by another dollar a year. And finally, in Boston, just finished the casino designs, the more meticulous and more detailed aspects. We intend to present a product in Massachusetts that has never been seen before in any city or any country, including in our own buildings.
We've taken an approach to Boston that is dramatically different than any casino presentation that has been seen in our historically. I don't think in my 40 odd years that I've ever been as excited about a project as we are about Boston. Hopefully, the election a week from tonight will confirm that the legislation stands and the voters of Massachusetts will vote no on question 3. I had the unusual experience of talking to former Congressman Barney Frank today and congratulating him on his op ed piece in the Boston Globe in which he explained that people should be allowed to spend money as they see fit. And with that, we'll take questions.
Our first question comes from the line of Felicia Hendrix with Barclays. Steve, as you started your prepared remarks, you mentioned about you were talking about Macau and how it's interesting because there's a political influence there. And you were talking about how some of the VIPs were lying low in the quarter. Given your view of how things were perhaps stabilizing in July when you talked to us last. Was that what surprised you most about the market?
Or were there other things that surprised you in the quarter?
Well, it's interesting to see the business community respond to the tempo of the central government. The businessmen that we talk to in Macau are very sensitive to the mood of the central government. And I guess, I don't know how to say it any differently than that. You compound that with the disturbances in Hong Kong, which has certainly put the central government to the test on one of its most basic perks or prerogatives in the modern world with the special administrative region of Hong Kong. And that is who's going to nominate the candidates or what is the nominating process for candidates for Chief Executive Officer.
These are very, very interesting issues. And as you undoubtedly observe on the media, there are strong ceilings in the community. And my guess is that at some point the matter will be resolved and everything will settle down. The business interruptions in Hong Kong are disturbing to the business community and to the community at large in Hong Kong. And I'm sure they're disturbing to the central government.
It's hard to believe that both sides will remain intractable, But it is after all People's Republic of China and Hong Kong is part of it. So it will be interesting to watch it play out. The only thing I share with you is the front row seat to the process and hope that it plays out in an orderly fashion. We experienced in October a perfect storm. We had the lowest hold percentage for a number of weeks than we've ever experienced in China.
When I say it's a perfect storm, it's unusual. It's a statistical anomaly to hold 0.9% or something like that in a 2.7% or 2.9% gain. But on the other hand, we've held 4% on occasion. So it's a gate that swings both ways. Those things straighten themselves out.
We don't pay really any attention to that. Adjusted our whole percentage would put us in a market share of about 10% again. But even at 10%, we suffer the same fate as the rest of the market when it experiences a decline. So I don't know surprise is the right word. Disappointment certainly is the word.
I try not to use that word, so I use surprise. You talked about hold on the VIP side. It does look like you held a little bit high on the mass side as well in Macau just relative to the past few quarters where we've really been seeing the impact of the increased purchases at The Cage. How should we look at just since it's not somewhat of a new phenomenon seeing the hold be in the mid-forty percentages. I know it was 50 and changed this quarter.
How should we think about a normalized hold for your mass segment?
Great question. I don't have any more clues than you do on this one. I think what you should do is pay attention to the wins. I mean at the end of the day casino revenue before expenses is measured by how much is left. The purchase of these chips at the cage a moving target.
And I don't know how to explain it or to normalize it, because I've watched it fluctuate as you have. And I don't think it really matters very much really when we get right down to it. I don't think it really matters. It's the revenue. It's that win figure that we're all focused on and that's the one that counts.
Okay. That's helpful. And just finally, again, regarding the market and I'll use your word disappointment. Do you think any aspect of that is coming from the smoking ban?
We think I asked that question of my colleagues. Ian is on the call. And I think it would be a great thing for him to address.
Well, we've just had a couple of weeks to gauge it and a couple of weeks after Golden Week. So I still think it's early days. There's no doubt going to be an effect, but I think it's the least of our concerns in terms of revenue drop off. We're all still engaged with the different departments of government in finalizing how our smoking areas and non smoking areas are divided. It's still a discussion that's ongoing.
The players have reacted very well to it. The smoking rooms that we've established at Wynn Macau have been very successful.
We're in
the process of establishing an additional smoking room based on location. But overall, I wouldn't say that that's had a huge effect on business. There's been some effect, but it's been marginal.
Also I think that technology as we go forward is going to play a part in this. Right now the air in the Wynn Casino terms of general public health. And I think that within the casino whether people are smoking or not in VIP rooms for example, we are able with advanced air exchange methodology and technology to keep the employees free of any potential impact of secondary smoke. What is interesting in this conversation is that in conversations with the culinary union that ensures all of the people that work in these casinos where they have smoking, There is no evidence whatsoever of any increase in emphysema, lung cancer or any other respiratory complication associated with working in a casino compared to the general public. So the threat represented that smoking in our buildings where we have very advanced air exchange technology.
Maybe it's because everybody knows that the air is cleaner in Las Vegas than it is anywhere else. I'm sorry. It's my dog barking in the background. I beg your pardon. Anyway, the air exchange systems we use keep our casino smoke free.
And although that hasn't been particularly important to the government in their determinations, as time goes by, I'm hoping that we'll get a very mature and sophisticated look at this problem, keeping 1st and foremost the health of our employees as the principal consideration.
Thank you very much. Your next question comes from the line of Joe Greff with JPMorgan.
Good afternoon, everybody. You did a nice job outperforming the market in Macau on the mass side. Steve or Ian, maybe can you talk a little bit about what you're doing there? And do you actually think maybe the clients in VIP are giving you sort of this indirect benefit and that frees up some rooms and table capacity to go after the premium mass customer? And then obviously when Las Vegas Sands reported earnings last week, they talked about competition in the mass of the premium mass segment that led to their having some margin degradation on those segments.
Can you talk about that on your side as well? Thank you.
The first question is, is there an increase in the mass because of pressure on the VIP? I think the answer to that is yes. Is there margin pressure in Macau? Yes. The competition as I've said on previous calls is extremely intense.
And if anything any of its market growth then of course you see this either a loss of market share or a loss of margin. 1 of those two things has to happen. And we've got new facilities coming on in Macau in the next 2 years including ourselves. We've got capacity increases coming in January in the existing Macau Hotel, very dramatic capacity increase in terms of these the junket rooms we're building these 2 gorgeous VIP areas. And that's going to allow us to increase our mass a little bit again.
So it's everybody is moving their floors. They're using their tables and their spaces intelligently trying to protect their margins and to dedicate the tables that are available to the most profitable usage. We're doing the same thing. But I'm not surprised to hear that there's margin squeeze at the mass market. Have we noticed that too?
In our mass market area, our margins have been constant over the last three quarters, so give or take 100 basis points. So just in our mass area and premium mass area, we've seen our margins stabilize. Which is no indication that that will continue. Yes.
Great. And when you look back at the 3Q, Matt, was there anything interesting
from a margin or expense perspective? Obviously, 34.5% margins in the environment that we're in Macao is a great result. Is there anything that absent massive mix changes that that's not a good level to look at going forward?
Well, Joe, the October. Yes. Our math and slots made up for it in the 3rd quarter, but everybody's seen the October results for the market are down over 20%. So clearly there's going to be more margin pressure going forward.
And when you look at the October to date results, how much mass market growth deceleration is there? And that's the big question a lot of us are wondering right now.
Robert, Gansmo is on and so is Frank. I don't know what our hold is in mass I mean, what our revenue I guess, we can forget about the hold because of the chip issue. But I really hate to describe this quarter based upon 3 weeks. I'm very tentative about answering that one, Joe.
Okay.
I just think if I'm too preemptive and premature that I give you the wrong lead. And I know that you're asking the question for all the right reasons, but I wish I had an answer that I could lean on. And I'm not comfortable on this short string not with all the other things that are going on in Hong Kong and smoking. I'm confused at the moment Joe. It was Joe that answered the question.
Joe, I'm confused at the moment.
You're not alone. Thank you very much.
And Joe, the other point that's obvious is October last year was up 25% or 30% in every segment. So the comp is also very difficult. And we're all in the low.
Yes. And they're riding in Hong Kong. I mean really and the government says no more smoking here and there. And so many of our customers are smokers. There's just too many moving parts for an intelligent response I think.
Thank you very much.
I think you're in the same spot with your clientele as we are with ourselves. Your
Thank you. Just to turn over to Cotai a little bit and the development there. Obviously, it looks like maybe there's an incremental $100,000,000 of spend associated with it. And I didn't see a lot of color on Phase 2. Could you guys kind of walk through how you're thinking about that project today, maybe what the increasing $100,000,000 is as well as how you're thinking about Phase 2?
Well,
certain changes had to be made in order to accommodate Phase 2. We didn't want to get ahead of ourselves too far with regard to that until the government had responded and given us the appropriate kind of permission. But you know some of it has crept into our Wynn Palace budget. But basically our planning and that went into that job and the Jamal and his team and Mike Harvey and everybody in supervising that construction. The government has been cooperating and it's moving very nicely with the latent construction folks who built our other buildings.
Redirect your question.
No. I think that was it. And more or less I'm assuming then based on your answer maybe that $100,000,000 for some piling and foundation work that would be associated with Phase 2?
Carlo, it's Matt, Mattox. So half of it was actually forecasted preopening expense, which we report and other companies do not because of the incremental payroll and other human resource programs that have been going on. And it's not $100,000,000 it's just rounding. So it's much less than $100,000,000 The second I think it's That's right. It's $56,000,000 The second thing is we protected all of our contingency in our construction budget.
So we're going to be able to utilize that going forward if there are any other issues. And our current GMP is at 85% bought out or let. So we're feeling good on the construction side.
Great. That's helpful. And then if I could just a follow-up. Obviously, Steve as you noted earlier and I think we've talked about prior calls, the mass hold percentage at 51% in Macau today. Other than reading into it that your premium mass business obviously is becoming guys have started doing differently to grow that business?
Or are you kind of business that you guys have started doing differently to grow that business? Or are you kind of it appears as though you're meaningfully bucking the trend of the market especially in premium mass?
Here's one of the things that we did. I guess in business and life you have to be lucky even better than smart. We made a decision in the building of the Palace, which was a very important decision. If you're having a lake of 8 acres like Bellagio in front of the hotel with all kinds of new advanced water attractions including a Dobelmeyer gondola that goes through the fountains and into the hotel, you say, okay, what are we going to do with the Lakeside property, which rings 180 degrees of this lake? You're going to do stores?
Are you going to do lobbies, restaurants or what? Well, we made a decision, Mr. Butler and I, Dee Butler, my design partner and I several years ago. And I mean we inhaled and said, okay, we're going to put all of our premium VIP business of every description on the water every one of which every chamber every room from one end of the building to the other will be on the water looking at the fountains and the water show. And every one of them will have bathrooms, food and smoking balconies.
And our entire hotel has got balconies all around the lake on all of the VIP and mass rooms. This is going to turn out to be a wind fall kind of event, because folks are going to be able to gamble and step outside 8 or 10 feet, look at the water. And if they've got a yen that continue to smoke they'll be able to do so outside. We're very advantaged by the basic plan of the Palace, which puts all of the important gambling with terraces. All of it, it's quite it turns out to be quite fortuitous.
And I must say, I wish I could take credit for having thought of it in advance, but it just worked out right. We didn't expect that the government would active as aggressively and as dynamically as they have on the smoking issue. But having done so, we find ourselves in a position that we've accommodated it in our new hotel.
Got it. Thank you.
Your next question comes from Shaun Kelley with Bank of America Merrill Lynch.
Hey, good afternoon. We've spent a lot of time talking about the mass business, so I figured I'd switch gears and just ask about VIP. Could you just give us your kind of latest thoughts on what you're hearing for some of your junket partners? There's obviously always discussion in the market about this, but just maybe an update on credit settlement and your kind of general view on maybe when some of those higher end VIPs start to take a little bit more risk and step back into the market?
Don't know. What we're giving them is sympathy. We don't know what can we say to them. I mean, they have to take the business the way they find it and assess their own risk. Our policy is rather we got a short string on all this stuff and they've respected that.
Maybe some of the competitors have lengthened the string. We haven't had to do that.
Maybe I can ask it this way. Just any sense obviously, I think everyone both the junkets, the casinos lending everyone's probably taking a step back and to wait and see. Do you think things are getting worse at this moment Steve? Or do you think it's fairly like things are starting to settle down and now everybody is just in a wait and see mode?
Well, that's an easy question. It's worse in October than it was before October. So if you're asking where does the nadir of our experience, it is current.
Okay. That's very helpful. And then the other question I have was just if you give us a quick kind of preview of your latest thoughts on the West Zone renovation? Because you did mention I think in some of your remarks that you've got some interesting features there that might help out when that opens for I believe in January?
It is going to open in January and we're getting ready to install wall covering and like that. The walls are up. It's on schedule. It was a very, very complicated construction job, because we had to re plumb and do things in the floor and other things like that. It's a very dynamic.
It's probably the fanciest high limit gambling place that we could use in our experience for any customer whether it's our own customer or a junket operator. And by being able to have this whole fabulous end for them, it frees up some of the rest of the place for us to use in other ways. It also allowed us in terms of the general flow of the casino to compress to offer the to put these junket and these high limit gambling areas right next to MGM and have access from the outside for pedestrians directly into this space without having to navigate the whole floor of the building. And those these buildings are rather large that it's a big convenience issue. And it also allowed us to compress and to improve the general flow of Wynn Macau, so that it would support and enhance the usage of the mass tables.
The whole project was well considered, long considered before the team in Macau, before Ian and Linda and everybody finally signed off on it, we had many iterations to try and catch up with all of the things we wish we had done when we built the place in the first place. Every one of these resorts no matter how carefully considered take on a life of their own after they open. And then you find yourself saying, wow, I didn't know that the people would go there instead of here. I didn't know that that would work the way it's working. And then you say, well, how can we adjust?
Some of that is really hard to get to. And you wish that you could make a change that is clearly beneficial, but it involves interruption of business and some basic reconfiguration. Well, we decided to take that step after several years of operation in view of the fact that we're going to compete with ourselves at Wynn Palace. We wanted to make sure that Wynn Las Vegas held its position as a premier stop for all of the top players. And the things that we've done in the past 18 months to reconfigure the Wynn casino, I think we all believe at least do exactly that.
And so we can't wait to see the impact, which will show up in the Q1. I'm hoping we'll be able to talk about that with you in April.
Thanks very much.
Our next question comes from the line of Harry Curtis with Nomura.
Question going back to the Palace. On the last call, Steve, you talked about taking delivery in I think it was December of 2015 when you commented it's still on time. Is it do you still expect a December 2015 delivery?
Yes. We begin to get the spaces turned over to us for stocking the kitchens and cleaning, preparing all the rooms, housekeeping is on the job. And then we turn the place in late December and in January into a campus. And it is our practice to first take the staff and give them the building for themselves for a couple of weeks to practice in which we break all the systems. We go to all our backups.
We have all of our employees stay in the rooms. We test everything over and over again, because we have a very strong opinion that you only have one chance at a grand opening to make that wonderful initial impression. And considering that we're going against such wonderful competition at Galaxy and City of Dreams and at the Sands Company with all the products that Sheldon and Packer and Lawrence Ho and Francis Lloyd have done, we want to make sure that when we open the Palace that everybody is impressed. So we're going to have rehearsals. And that campus that I referred to the training facility, I hope will take place in January.
And we've had a chance to move in and get the draws filled with pencils and papers and the linen put away, freezer boxes and walk in coolers stocked and we start cooking in the kitchens and all the chefs tell us that we did a lousy job designing the kitchens as we always do. We also have adopted a policy of entertainment. We know that in Macau people gamble and shop and eat. And what we said was in that case let's take the entertainment aspect of the hotel into the restaurants where they can where they'll surely be enjoyed. So we have done things we've never done before in restaurants.
One particular restaurant is a continuous series of entertainment vignettes walls open. It is a stage and some very fanciful and unique things take place in other restaurants other things of that sort. Every one of our restaurants has an entertainment quotient to it. We've decentralized entertainment in each of the restaurants and of course in the front yard and in other places in the hotel, the lobbies, the entrances are all animated expensive entertainment attractions. We are spending 100 of 1,000,000 of dollars on entertainment in this facility, so that literally the hotel itself is the show.
Steve, just as a quick follow-up.
In the last
quarter, you made a prediction on the number of tables that you thought you got you would be getting. And there's a lot of debate around that and it's probably fairly opaque. But can you give us an update on your level of confidence that you can still get over 5.50 tables?
Well, the only reason I said that is because I had discussed it with the government and I was given permission for it. But again, in China, the final proof is in the in what happens when you open. And the government has full control of those sorts of things. I don't have any reason to believe that we'd be allowed to build a building that was very carefully reviewed and examined by the government and then be surprised. I suppose it's possible.
But I don't have any history in Macau that would suggest that that's probable. I know that our competitors all have and offer freely their opinion of what's going to happen to us, but competitors have always done that. I remember that 2 weeks before we opened Mirage, an
unnamed competitor. But as the
as Forbes Magazine's insider gaming insiders have said that you can't make it that your overhead is too high and that the Mirage is going to go broke. Our competitors always seem to have a very confident view of what's going to happen to us. I don't much pay attention to that. I do pay attention to what the government says to us. And of course, I pay attention to our own history there.
And the government has been very
time
carefully, made suggestions and then when appropriate they've given us the green light to go ahead and build these places. That's the frame of mind I'm in. Maybe I'm a Pollyanna, but I think that I'm taking the only practical approach.
That does it for me, Steve. Thanks.
Sure.
Your next question comes from the line of Thomas Allen with Morgan Stanley.
Hey. On Macau mass market margins, you talked about the risk to margins as revenue slows. I think we all know about kind of the labor and operating cost inflation. But in terms of promotional spending on the VIP side, you've always been able to keep your commission steady when we've seen increases in the market. Do you think you can do the same on the mass market side with promotions kind of the premium mass customers?
Thanks.
What happens in our business is that at the end of the day, the critical decision of where to gamble is made by the customer. Operators and hosts and marketing people whatever their particular titles may be, they service those customers. So when you're in our position, when you're on our side of this discussion, it's the product that you put out that determines the accurate is because the product that we produced was always a little bit better and the service a little bit better at least in the eyes of the customers than what they could find elsewhere. When we took up the idea of building a hotel in Cotai, we recognized the quality of the competition. And that sharpened our senses and made us even more self critical than we have ever been before.
So that we came to the conclusion that we had to reexamine every part of the hotel and everything that we were going to say to the clientele in terms of service, food and beverage, entertainment and of course user friendliness in the gaming areas of the building. With the firm belief based upon our own history that in the end that would give us whatever leverage was available under the circumstances. If you were to change places with us, I'm sure that you would come to the same conclusion. Now every time that you operate on any premise, reality sets in and the facts expose themselves over a period of time. I've told you how careful we were at Wynn Palace and the great respect we had for our neighbors.
And we acted accordingly in conceiving of the hotel. It is the best job we've done, I think, in my career. I'm operating with a group of the most talented, most experienced people that have ever worked in the gaming industry From Gamal Aziz, Linda Chen and the staff of people that work for them in marketing to Ian Coughlin's experience in the hospitality industry and the experience he's gained over the years as a gaming President, all of this has come to bear. And every one of these people have really focused hard on everything that we're doing. In the long run, it will be the human resources of the leadership of this company and the staff that determine the outcome.
And I go to bed every night with a firm conviction of that truth and no other. And then I leave the guesswork to other people. I don't know if I'm being helpful to you. All I can do is share with you the mentality of our management and for investors. That is of course at the end of the conversation the only thing that matters.
That's helpful. So just I mean slightly shorter term though if we do see some kind of promotional spending more in the near term, do you think that you have to compete there? Or do you think the quality of your product before Palace opens is strong enough that you wouldn't really have to get into that game?
We could do all the things I just mentioned. But at the end of the day, we have to deal with the situation as we find it. And each company tends to give away in terms of promotional allowances destructive. That number is subject to change from time to time. Incidentally, it's subject to change down as well as up.
Sometimes people overspend in promotional allowances and it becomes an exercise in futility, in which case you back off or the executives get changed and somebody new comes in to run the place. 1 of the 2 things happens. If you find yourself in an advantageous position and you think that by increasing promotional allowances you can have more money to the bottom line even if it means the margin percentage is less well then you go for that. I know that my friend Sheldon Adelson has that kind of mentality with his business. And so margin percentage matters, but what about the money?
At the end of the day, that's the only thing that matters is you'll excuse the cliche. At the end of the day, everybody says that. But in the final analysis, it's the money, isn't it? And you got to take the market month by month I think.
Thank you. And then just two quick follow ups on Vegas. 1, you reported really strong RevPAR growth of around up 8% this quarter. Can you just talk about forward bookings a little bit? There's obviously the really hard comp in 1Q with ConAg.
Do things look like they're just getting kind of build strength going from strength to strength? Or did things flow a little bit?
Well, last month I raised the rates by 18% of our hotels in Las Vegas to online booking agents and to everybody else. And we benefited from it. That's why our RevPAR is up. That's one of the fun things you get to do when you got a better mousetrap. I think that's probably a poor choice of words, better facility.
These places are hardly mousetraps at 5 dollars bn related
costs. And Steve, the Vegas property EBITDA peaked last cycle around $420,000,000 You have 75% more rooms today. Could you see that kind of increase in terms of EBITDA that does kind of this cycle? And then I'm done I promise.
We've passed $420,000,000 already. $486,000,000 last year. Pardon me? $486,000,000 last year. We did $486,000,000 last year.
And we've got $520,000,000 for the last for the twelve recent 12 months, 526 I think. And I'm hoping that the Q4 will get us over 500 for this calendar year. It'll be a countdown sort of thing in December, because all the money comes at the end, But it seems okay. But again, we're an international place and we get a lot of Chinese and Latin business. And things going on in the world affect us a lot in our place.
But we will have the most profitable hotel in Las Vegas without a doubt. There's no question about that. Conde Nast Travel made us a leading hotel last week in Las Vegas again based upon visitor voting, which was satisfying to us to get that distinction. And so I'm happy about that. You take care of your building.
You keep working with your employees to make them more effective, more self conscious, more aware of their personal responsibility in the building. And in the long run, it's a slow it's the hare and the turtle. It really is a marathon not a sprint. And we're enjoying the benefits of our of being steadfast here.
Great. Thank you. Sure.
And our last question comes from the line of Robin Farley with UBS.
Great. Thanks. Two questions. One is, can you talk a little bit about your own experience with collections to the degree that where you do have direct VIP business. I know others have asked about junket collections.
But I wonder if you could talk a little bit about your experience with that in the direct VIP? And then unrelated to Macau, can you just share any thoughts on your interest in Japan potentially if Japan doesn't allow resorts to be open to locals how that would affect your interest? Thanks.
I'll take the last part and I'll let Matt do the first part Robin. I don't know what's going to happen in Japan. I think speculating on Japan at this moment is really, from our point of view not productive. The situation there is undefined by any measure of close scrutiny, undefined. I do feel that any interest in broadening the ability for people to gamble in Japan is based upon employment, increasing tourism and that sort of thing.
And I think that the Japanese government is well enough informed. They could understand that a foreigner owner a foreigner a foreigner's only casino would not get that job done for them. I'm pretty confident that they would come to that conclusion. And I think they want to keep the money at home if they do this at all. So I don't think it's going to turn out that way if it turns out at all.
I think probably the more important question is are they going to do it at all Robin? And I don't think and I think that's undefined at the moment. With regard to our collections, I'll turn that over to Matthew.
So Robin in the Q3 in our direct program, turnover was relatively flat with last year. The decline in VIP was largely in the junket area. And our collections in our individual program have been very steady. We haven't seen a slowdown in that because we remain cautious in who we issue the credit to and we know our customers well.
Okay. Great. Thank you.
Are there any other questions?
There are no further questions today. Are there any closing remarks?
Matt? Gamal, do you have any Gamal, you were quiet on this call. Do you have any comments?
We just that we aren't on track Steve and we're feeling pretty good and very confident about the opening dates, about the interest and employment for our property. We're getting early signs of tremendous talent wanting to be a part of Wynn Palace in the future. So we feel pretty good and very confident about Wynn Palace at this point.
Linda, do you want to make any projections? Or if everybody is so curious about the junket operators. You're the closest one in the family to all of that. You want to go out on a limb and make any predictions? Or you want to stay safe?
I don't want to make any predictions, but I think it is no secret to anyone that the junkets are being cautious and they're being conservative. So no different than the retail sensitivity people are not spending lavishly during a market time like this. So on the
Yeah. Louis Vuitton, Christian Dior and folks like that and Cartier and Chanel are noticing all through China the same thing that we are talking about today.
Yes. But I think they are being very responsive being conservative and they're also taking this slow time to if you may reorganize. So the mode of the market was to expand and expand unlimited. Now they're actually consolidating. So no different than any other major industry that when they face a financial difference in banking whatever.
So now the time is for them to be relooking at their future, which I actually think is a very positive outlook if they are being responsible about it?
Well, they're the best thoughts of all of us. The folks on the call. Our competitors of course are listening to all of them. I say, hi and wish them well. And we'll speak to you again in 3 months or so.
Bye bye everybody.
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