Good afternoon. Welcome to the Wynn Resorts first quarter 2013 earnings call. Joining the call on behalf of the company today are Steve Wynn, Marc Schorr, John Strzemp, Matt Maddox, Kim Sinatra, Gamal Aziz, Maurice Wooden, Scott Peterson, and on the phone, Ian Coughlan, President of Wynn Macau, and Robert Gansmo, CFO of Wynn Macau. My name is Amy, and I'll be your conference operator today. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. If you would like to ask a question during this time, please press star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. I'll like to turn the call over to Mr. Maddox. Please go ahead, sir.
Thank you. Thank you, everyone, for joining us today. Before we get started, I just need to remind everyone that we will be making forward-looking statements under the safe harbor of federal securities laws. Those statements may or may not come true. I'm going to turn it over to Steve for opening remarks.
We have these calls every 90 days. Usually everybody who's on the call has seen the numbers. It was our best quarter ever in China at $330 million. We did okay in Las Vegas at $120 million. Construction in Macau is at full speed on our Cotai project, which is our third hotel. The budget is still just under $4 billion and six million feet. We're very pleased with all of the things that have taken us two years to design. We're in a very competitive market in China as well as Las Vegas. In Macau, we're in a situation where the licensees, the holders of those concessions, the three major concessions and the three sub-concessions, are all very smart people with very intelligent organizations who are learning from one another, making sure that competition doesn't get the jump on each one.
The quality of the competition has been steadily ticking upward the past several years since we opened in 2006. We had certain advantages that were related to our experience in the industry and our brand. We have fought diligently to maintain that advantage. We will continue to do so. It came to bear, especially, in the conception and the design of Wynn Palace, which took two years before we were in a position to break ground. We waited for our final approvals. There wasn't a week or a day that didn't go by that we weren't bearing down, concentrating, bringing to bear all of our experience and expertise of our design teams to come up with a place that would be irresistible when it opens, hopefully for Chinese New Year in 2016.
Our contracts with Leighton and our builders include those dates. We believe we'll meet them. As you know, we are competing for a license in Philadelphia and one in Boston metropolitan area, Massachusetts. Those processes are underway. We are again bringing our best game to the table. How it plays out, we will not know probably until the fourth quarter of this year, and maybe a little beyond in Massachusetts. We are making progress. We have completed preliminary designs of those new properties. We believe that the urban Wynn in big cities give us the opportunity to introduce to those metropolitan areas new and very glamorous hotels that would otherwise not be profitable in view of today's average hotel rates, the internet, and the cost of construction.
However, with the addition of a gaming room that is separate but adjacent to such beautiful hotels, food and beverage, entertainment, shopping facilities, and convention facilities, the existence of a casino room makes a new hotel in a city like Philadelphia and Boston, and hopefully someday in Toronto or New York or wherever, a chance for a new hotel that would otherwise not be economically feasible. We call this notion the urban Wynn. In a complicated world full of change, things like internet gambling, which almost defy analysis month to month, the rules, the regulations, the laws, the absence of laws, all of this makes digital gaming a little bit murky to us. The idea of having the best hotel in Philadelphia, the best hotel in Boston, that's not murky to me or my colleagues. That's something we understand.
The best hotel in major cities has a great future. Tomorrow is better than today. The day after tomorrow is better than tomorrow. You build those kinds of institutions, those brands, by delivering on the promise. Our company has been well known for that for many, many years. That, again, is what we're bringing to bear in our applications in Philadelphia and Massachusetts. I think without tooting our own horn, that's really basically the way we're looking at things these days. We'll be glad to take questions. I want to remind you that the senior management of China and Las Vegas is here in order to give color and depth to any of your questions. Go ahead and start.
At this time, if you would like to ask a question, please press star one on your telephone keypad. Your first question comes to the line of Carlo Santarelli with Deutsche Bank. Please go ahead.
Hey, good evening, everyone. Steve, if I could just follow up as you talked a little bit about urban Wynn and obviously the Massachusetts project. Could you talk a little bit about how you guys are thinking about allocation of capital in the event that maybe these urban projects don't come to fruition?
We build our places with modest lending. We try and keep an equity-to-debt ratio in our properties that allows us to maintain our investment-grade rating on our subsidiary non-recourse debt. I think we're the only company that does enjoy that at the moment, at least the last time I checked. That use of our capital as we approach each project allows us to protect our service levels, and our employee base, in spite of economic vicissitudes. If there is no Philadelphia and Boston, we're going to be in the fortunate position of having excess capital. What we would do with it, is something that the board of directors would take up at the time.
Right now, our dividend policy, which is $1 a quarter, and is basically scheduled to be the kind of a dividend policy that can continue while we build the new projects in Cotai. We did borrow money last summer. Matt was particularly successful in borrowing the money that we need for Cotai at LIBOR plus 175. Most of that money was in a revolver. A third of it, or a little less than a fourth of it, was in a term loan, which we locked up at under 2.5% for the period. We're very happy with our interest rates and our maturities. We go forward trying to take advantage of opportunities that present themselves. Your question is very interesting. I don't know how to quite answer it except to say, we'll take one step at a time.
That's great. That's very helpful. Ian, if you're on the line, if I could, obviously the property enjoyed a solid quarter, and you guys actually surprised to the upside on the margins, and granted some of that's from hold in both the mass and the VIP, but also the commission number seems to be down a little bit. Is that best interpreted as having a little bit more fortune with your direct players relative to your junket players? Is there anything else that's maybe changed on that side or on the margin or the expense structure as a whole?
That you're correct. That's pretty much what it is.
Okay, great. Thank you very much.
Your next question comes the line of Shaun Kelley with Bank of America.
Great. Good afternoon, everyone. Probably another one for Ian over in Macau, just wanted to ask a little bit about what you guys are seeing in the premium mass segment. We noticed from the release that obviously drop was actually down a little bit, but your hold ratio was up materially, as far as what we can calculate. You guys gave a little bit of explanation, but could you talk to us just about what behavior you saw over the course of the quarter that drove such a high hold ratio, and if you think that this is kind of the new pattern or relationship going forward?
Hold on. Ian, just one second before you chime in. There's something in Matt's release that I would like to draw everybody's attention to because it's significant and critical that you take note of it. What's happened in Macau is something that we've never seen in Las Vegas, but is a growing pattern, and it should affect all the analyses that most of you are doing. What's happened is the customers are buying the chips at the cage, which does not enter into the drop. The whole percentage in the mass market and our Diamond Club, our premium mass market, is an irrelevant number.
You should disregard that number now and pay only attention to the amount of the win, because this absence of the chips purchased at the cage in the handle has skewed the numbers and make it look like we're holding an abnormal amount of money. There was one part of our casino in Encore, which looked like it held 100% or more. Our advice now to observers of the industry and our investors, disregard the whole percentage in Macau in the mass market. It is now an irrelevant number because of the particular nature of the behavior of the customers. Ian, you can pick it up from there.
Just the high-limit mass table games and high-limit slot market has had a lot of attention over the last six to nine months as our competitors caught up with what we did with Encore. Nobody's quite matched Encore at this point, and we continue to upgrade our high-limit areas. We just opened a new high-limit slots area, phase 1, with 96 slot machines, and we're opening up our phase 2 with another 50 machines this weekend in time for the May Holiday. In general terms, everybody's shown their cards, and the customers are now left to decide about where they prefer. There's been a lot of ramp-up in activity with generous giveaways, and people can continue to sustain that. We've chosen to just take good care of our players without giving anything too much away, and I believe that the playing field will level over the next 12 months.
Our mass business overall is very healthy. Our high-limit business remains strong, we're pretty confident going forward.
That's great. Just one follow-up on the VIP side there. Obviously, volumes were down a little bit, but that could have been driven by how well you held. Could you just talk us through what you guys saw in terms of VIP activity throughout the quarter? We've heard a little bit about lending maybe coming back from some of the junkets. What are some of your junket partners saying?
There's a lot more confidence over the last four or five months than there was in the summer of last year. Business grows organically and nicely. Our direct program is growing nicely. Our junket partners are doing well. We open a new junket space on property for Chinese New Year next year. That's the next big junket event for us. I think people are generally pleased with the market.
Great. Thank you very much.
Your next question comes the line of Joseph Greff with J.P. Morgan.
Hello, all. Steve, thank you for your commentary on maybe the decreasing relevancy of mass drop. The mass revenue, the mass win was a great result. Can you talk about what marketing changes you may be making on the premium mass side? Whether there was anything to note within the quarter on the mass side, whether average bet size or number of players in that segment. You can share with us that maybe talks to the degree of volume versus wager per player.
There's myself here in Las Vegas with my job title, and then there's the kids that are running the hotel in Macau. I think probably you need to hear from both of us on that question, Joe, for me.
I'm happy to take a crack at it.
I take this approach. There's really nothing left to do in our industry except the basics better. The idea of a runaway building, a preemptive over-the-moon structure. I think when everybody has virtually all the capital they need to build any structure in Macau, that the building budgets aren't really very important anymore. Nobody has an advantage over anyone else. None of the six of us are short of money. The market justifies massive investment. Therefore, you get back to saying, "Well, who are our customers? What do they really care about? How can we best serve those needs? How do we address ourselves to the fundamentals of our business?" That's why my answer to that question is sort of a macro answer, and there's nothing left for us except to do the basics better.
That's why Ian Coughlan is there, why he left Peninsula and came to work for us. Linda, are you there?
No, she's not.
She's not? She's on the road?
Yes.
Marc Schorr's here.
It's one customer-
Come over. We're using a common speakerphone.
Look, we just identified-
Come closer even.
We identified who our customer is, and our goal was to take care of that customer's needs. As you said, just go back to basics, 101.
We really didn't do anything extraordinary at all. We go to our strength, which is the fact that based upon many years of experience, having developed the best hotels over and over again and dominated every market we've ever been in. If you take any single property, whether it's downtown Las Vegas, Atlantic City, the Strip in Las Vegas, we've never, ever not had the best hotel in each market that we've been in for the past 30 years. Now, the reason that's been true is because we really focus on the fundamentals, and I think that's all we're doing. There's a lot of smart guys in Macau, and they're getting smarter by the year. I really have to compliment the competition in Macau. I find that the offerings that are being made are keeping us all on our toes.
I happen to love that, incidentally, because it stimulates us. If we go and see a poorly done job, it disappoints us, even if it's our competitor. When we see a good job, like we see so often with our competitors now, both MGM and the Sands, the felt kids from Melco. I had coffee the other day with Jamie Packer in Los Angeles. All these guys are on their game. The people at SJM, Stanley Ho's company, Angela and Ambrose and Louis Ng, these are all triple smart people, and they're on their game, and so it's keeping us on our game. I wish I could tell you that we had pulled a rabbit out of a hat, but there's no rabbit, and there's no hat.
Great. Excellent. Matt, a few other questions here. I noticed on the P&L, the provision for doubtful accounts was down year-over-year, sizably. Can you just comment on that? It looks like it was a collectible in Macau.
Yes, you're right. What I'd say is the provision for doubtful accounts, this is about the appropriate run rate. This may be a little more going forward. It fluctuates as we get large collections in Macau that are fully reserved, and we feel pretty good with this run rate.
Okay.
You know we've never, ever exceeded our reserve in my history, either at Mirage Resorts or at Wynn. We're very conservative about credit.
Great. Matt, if you can give us the cash balance at Macau at the end of the first quarter, and if you adjust for normal holds in Las Vegas, what a hold-adjusted EBITDA result would have been. Thank you.
Sure. We have roughly $2 billion of cash invested, not in the cages, but in bank accounts, and 75% of that is overseas. We did announce an $830 million dividend out of our subsidiary
Once that's approved by the shareholders, that will be paid out. You'd see $600 million of that coming back to the parent company over the next two months.
The annual meeting is on May 15th.
That's right.
In Macau.
In Macau.
May 7th here.
16. Joe, that's the answer on the cash.
Yes.
Oh, yeah. It's May 16th.
May 16th.
Marc corrected me.
Yeah. Here is.
The 7th.
The 7th. Okay.
Yeah, they're a week apart.
Yes. Joe, what was your other question?
Other question was EBITDA on Las Vegas adjusted for normal table hold.
It's in the neighborhood of $105 million-$108 million, depending on how you normalize.
Great. Thanks, guys.
Just so you know, Macau is closer to probably $315 because we're not adjusting mass.
Which would have $315 normalized would've been our best month.
3:30 put us over the top, since we built the place.
Our next question comes from the line of Felicia Hendrix with Barclays Capital.
Hi, good afternoon. I wanted to stick on this phenomenon of the mass players purchasing more chips at the cage that's suddenly infecting the mass drop number. I'm just trying to figure out what happens in the quarter that might change prior behavior, because you guys have had a superior premium mass product since you've opened, and you've been servicing the higher-rated mass customers for some time now, so it's not like you suddenly have a new customer.
Let me put it in perspective. If you look at the growth in mass market in our casino, the Encore mass market casino revenues grew by 40%, and that is almost all premium customers that are not buying in at the tables. The 40% growth was in the Encore side, and then our main floor grew less. That's really what you're seeing, is a shift in the mix.
Felicia, did you understand his answer?
No, I understand it.
Okay, good.
Yes. That's actually pretty impressive given Steve, you've talked about the competition in the market, and we can all see what the table yields have done.
We're lucky. Someone asked me on the last call, "Are you concerned about the kind of places that are built in Macau, in Cotai?" I said, "Concerned? I'm frightened to death." These are very tough guys. Even though they're friends and we have dinner together and all that, these people. The game is being played at a very high level in Macau at the moment. Very high level. Very smart people, and paying close attention to their business. I have to say, I'm thrilled that we're able to hold our own there. I have great gratitude and respect for Ian and Linda, Robert Gansmo, Frankie. The group there is fabulous management team.
Yes, for sure.
They'll do a good job at Cotai, too.
We can't wait to see that. Steve, speaking of Cotai, you provided us with some nice updates in the release and in some of your prepared remarks. Just wondering, now that your foundation work is underway, if you could share with us any learnings you might have from that and any updates to the design?
No, the design is finished, of course. We're way past being able to fool with that. We took a long time, the longest ever. We usually take about 15, 16 months to do design development before we can break ground. We took 24 this time. Mainly as reflecting the respect we have for our competitors. In Macau right now, if you don't mind, we have this wonderful piece of real estate in downtown Macau, on the peninsula. We're across the street from four hotels. The StarWorld, SJM, both the Lisboa and the Grand Lisboa face us. On our right is the StarWorld and the Ark. Behind us, so we're surrounded on three sides, is MGM and fabulous shopping. As a result, we're sort of in the cross traffic.
To some extent, which I can't quantify, I don't know whether it's 10% of our business or 25% of our business, but we are definitely the beneficiary of people that can just walk across the street and change their luck. Since the junket operators are common to most every hotel there, they're like a service. They're like an ATM machine. They're available, and they have rooms in each hotel. The players go and just change their luck. The Wynn and Encore of Macau benefit from its strategic central location. We have the 100% location on the peninsula. Everybody surrounds us. In Cotai, as dramatic and as ambitious as these buildings are, there isn't a lot of what you'd call walk-in. They're separated, and the weather is warm. The people move around in jitneys and public transportation.
We said to ourselves, "Well, we may not be able to enjoy that geographic position that we have downtown. Let's design our Cotai hotel so that it is a must-see attraction." We are also benefited in Cotai by the fact that the new light rail or monorail system, we are the first stop coming from the boat dock, the ferry terminal and the airport. We're adjacent to the airport. The light rail goes around two sides of our property. It makes a 90-degree turn, very much the way the monorail in Las Vegas goes around the desert and golf course, the Wynn Golf Course. We wanted to make sure that people riding the light rail arriving in Cotai, business more and more goes to Cotai as the developments increase in their stature.
We wanted to make sure that when people looked at our lake, our fountains, that they saw something that was irresistible for them to get off the light rail. The light rail stop is right in the middle of the front of our property. They get off the light rail. They go down the escalator, off the monorail. They go down the escalator, and they're right smack, without taking another step, on our gondolas. We have these gondolas, the Doppelmayr of Austria built. The gondolas have music and color and air conditioning. They go through the fountains. They go around the lake and through the fountains and into the building. We created an e-ride to get into the place. It's a lot of fun. It was great to do because I'm trying to create walk-in business or, let's put it this way, ride-in business.
All of these new ideas are coming to play in the new hotel. The towers where the turnbuckles are for the gondolas, which are on the main drag there, are shaped like dragons. As you ride by in the gondola car, smoke and red light make it look like the dragons are puffing. All kinds of fantasy and the kind of public entertainment that we're famous for. Everything about Cotai is about entertainment. That's how we're going to meet up with our friends who are competitors and try again to hold our own against tough guys. Is that helpful?
That is super helpful. Just finally, in your prior comments, you had said that you thought that online gaming was murky. I was just wondering if you could elaborate a little bit more on your thoughts there. You had a partner once. That didn't work out for obvious reasons. Just going forward, what do you think?
I'd like Matt to talk about that. When I say murky, that's a Steve Wynn comment. I've often thought this whole subject of online gaming was getting everybody all jazzed up a little bit ahead of themselves, in my view. First of all, I think it's probably the most unsympathetic tax target on the planet Earth will be online gaming, where every bet can be measured by the government, both state and federal governments that have an insatiable appetite for new revenue these days. Another thing is that it's very difficult to distinguish yourself online. We sell experience in our buildings, and that's a long and difficult assignment, but we have experience. We know how to do that. I don't know how to make the experience on a computer screen 17 inches in diameter, particularly unforgettable.
We're going to learn how to do it because we're not going to be left behind in this matter, and we've turned this over to the capable hands of Mr. Maddox, who will give you his view on the subject.
I agree with Steve. It's murky. We're looking at all the opportunities around the world and talking to the various partners. We're moving cautiously, and we're really more in monitoring mode right now.
We'll have our oar in the water.
Yes.
As we should, on behalf of our shareholders. We'll take a ride on the railroad and go through the learning curve and bring common sense and hopefully intelligent judgment to the task. Right now, if anybody on this call can tell me what's going to happen with internet gaming in America, I'm dying to hear it. I have trouble predicting the outcome here.
As do I. Thank you so much.
Our next question comes from the line of Steven Kent with Goldman Sachs.
Hi. A couple questions. First, maybe you could just give us a little bit more, or tell us when you're going to start to show the images for Wynn Palace. I mean, you just described it very effectively, Steve, but I can see images for the proposals in Boston and in Philly, but I don't see anything yet for Cotai.
We are building a model, and it's almost finished. Is it not, Marc? I think you'll get it in 30 days. In the next month or so, we're going to have the model, and we'll be photographing it. We've got extensive interior studies, computer-generated. I mean, we built a building next door that's 32,000 sq ft right next to our employee garage on Koval Lane here in Las Vegas, and it's got glass walls. In it are each of the room types, the corridors, and 5,000 sq ft of the casino. Full scale. You can walk in it. I want to do a video of that in the next month or so, and when we get through with that video, you'll think the hotel's already built.
You'll be able to walk down the corridors, there's mirrors at the end of the corridor to make it extend lengthwise. You can walk in all of our room types, complete and finished. That's our practice. We spend a lot of money on modeling because we want to experience the hotel before our guests do, so that if we've made a mistake, we can correct it before we cast it in permanent concrete. We've been doing all this for months and months and months. It's all been done. We haven't had a chance to share it with everybody because we had so many other things on our plate with Philadelphia and Boston that had very definite and pressing schedules as to the calendar. We are finished with the model, and we'll be showing Cotai to everybody that cares to see it.
If you come out, we'll take you next door. If you want to come see it, any of you. As long as you're an investor as opposed to our competitors.
Separately, just on these, either Philadelphia or Boston, on basically an urban Wynn concept, how are you differentiating it from a regular regional casino so that you can get the superior returns you've been getting in some of the other markets without overspending and given the declining returns we're seeing in some of the other regional casino markets here in the U.S.?
I love that question. How do we compare to the other regional casinos? Hear me. There is no comparison. Regional casinos are boxes of slots. Period. End of sentence. We are building very lovely integrated hotels. Now, they don don't have 3,000 rooms, they've got 300 or 500 or whatever, but they have beautiful restaurants. They have atriums. They have convention facilities, meeting rooms that are delicious and better than any hotel in any city that we're going into. They have spas that are wonderful. These hotels are great places to go for a weekend, and you don't ever have to get near a slot machine or a blackjack table or a baccarat table in one of our places. Down the hall, the way a convention meeting room might be, separate.
Each of our cities, visitors who are not predisposed to gamble, families with children can go into our hotels and enjoy fanciful restaurants and shopping, and our other experiences that are associated with hospitality. Remember this, in our industry, there has been a simple truth. Slot machines and blackjack tables in and of themselves have no power at all. You create a legalized casino in a city, and they open up, a box of slots opens up, and the first year, there's a big puff of tax revenue and a big puff of earnings. They flatten out because basically they deal only to the neighborhood. Unless you bring people from outside the region into the region, you do not have a future growth pattern. We are building buildings that will grow and be the places where people from out of town come to stay.
Little destination resort hotels in beautiful cities, like where I went to school in Philadelphia or where my family is from in Boston. My mom and dad were born there. We have no comparison whatsoever to any local casino. They're all boxes of slots by my likes. That's all that they needed in those days. Harrah's did a very good job of building this network around the world, and I admire what they did. Their progressive bonus program has been a very successful one. Make no mistake, what we are building is not a box of slots. We're building hotels that just happen to have a gaming room out back with its own garage and its own access. Two separate concepts.
The urban Wynn idea will undoubtedly be copied as we go forward because we usually get copied. There isn't a model for what we're doing anywhere. That's it. This goes back to the Golden Nugget in the Horseshoe 30 years ago. Marc has made a good example. There was Fremont Street 30 years ago. There was the Golden Nugget. Everybody said Fremont Street has a personality and a profile and a revenue profile. We built the Golden Nugget, and it was just a little casino. We added the rooms, we rebuilt the place, we made a 2,000-room hotel out of it, brought in entertainment and shopping. We made more money in the Golden Nugget on Fremont Street than the entire Fremont Street complex total by a substantial margin. We had 58% of the profits downtown.
You change the game by what you offer to the public. We know what the public wants. It's a question of giving it to them. That's it.
Well, thanks very much. Look forward to seeing them all.
Your next question comes from the line of Tom Marsico with Marsico Capital.
Hi, Tom.
Hi. Thank you for taking my question. Steve, I was wondering if you could give us any insight as to the economic conditions that you're seeing from your customers as you talk to them in Macau. Is there a differentiation that you're seeing now versus six months ago when the new administration was being put in versus what you're seeing today?
That's a good question, Tom. We're very interested in the answer to that question. We're probing and asking that question constantly. Because of our relationships with our customers directly and through our junket operators, we're talking to a wide-ranging, very diverse population of businessmen from People's Republic of China, not just Guangdong Province, not just Hangzhou and Shenzhen, Dongguan, but far away in Fujian and Chengdu and Qingdao, and every place. What we're getting universally is a statement of confidence and equanimity in the feelings that these men and women have about the leadership of the PRC. They think it's stable. They think it's sophisticated and very, very switched on to what China needs. There's an awful lot of confidence that we're hearing from our customer base about the leadership of the PRC. There's a lot of confidence about the leadership in Macau.
It's different here in the sense that there's a mixture of social consciousness and business hustle, business aggressiveness, that's fascinating. The government of the People's Republic of China and Macau have come to the conclusion that the only important way to improve their country, and keep social peace and happiness, is by the creation of jobs. Everything in the PRC is about the creation of jobs, and that takes a backseat to everything else. They're very supportive of things that create jobs, and they manage to balance that with social consciousness in a way that makes life there predictable and easy. I've been criticized, or people have commented on the fact that in these conference calls, I often talk about the difference between leadership in America, in Washington, and leadership in China.
I'm going to say it again because it's only the truth, that there is a clarity that job creation is the only path to a better life for the citizens in China, and that does not seem to have been cleared up in America. Job creation is still not the priority in this country based upon the policies that we're dealing with or the paralysis in Washington. When they do act, they've acted in ways that are not constructive to job creation. We don't see any of that in Macau. What we see instead is a spirit that's the exact opposite, that comes from Beijing and filters through to the SARs, the Special Administrative Regions of Hong Kong and Macau, both of which are enjoying unprecedented success under the leadership of the central government in Beijing.
That's what I'm seeing, Tom, and it's coupled with a lot of confidence about the new administration in Beijing.
Was there a time during this change in the administration in China of the leadership that you did see a pause as far as confidence was concerned because of the uncertainties that Xi might bring to the new leadership position?
In the sense that there was a pause, not a negative pause. What there is, every five years, a normal moment in which everybody is wondering what is going to be the lineup on the standing committee of the Central Committee of the Communist Party.
We say the Communist Party as if this was the Cold War days.
Communist Party is a term that means an entirely different thing today in China. Until everybody knew who was going to be who on this standing committee. Xi, they knew he was going to be the boss, but there's much more to it than just the one man in China.
There's the other members. Power has been consolidated. The amount of the committee members has been dropped down by two. That may climb back up for the second five years as everybody starts to take care of everybody else. This is clearly a settled issue. Where everybody was a little curious before those names and the identities of the standing committee members and what their responsibilities would be, that period has passed. I think the pause may be the right word. Everybody was curious about who's going to be who. There's a big pecking order over there.
As far as the U.S. is concerned, and the major companies that you do business with special conventions and trips that they're offering for their employees, are you starting to see more confidence among decision-makers, CEOs, and such, as far as implementing those programs again? I go back to the days when Wells Fargo was told not to go to Las Vegas. Are those types of programs being re-implemented and you're starting to see a pickup in that area,
Maurice Wooden
for your hotels in Las Vegas?
Maurice Wooden is here with me, the president of the hotel. I think it may be good for him to answer that one.
Yeah. Let me just move over so I can get over here. We've been very fortunate to enjoy this year, where we've seen a great pickup in that segment. In fact, as we start to look at the first quarter, we had a 6%, actually a 7% increase in rooms, and also a 7% increase in revenues. Looking out over the rest of the year, we also see that that's a pattern that we feel confident that is going to continue to repeat itself. If we're looking out to grow out into 2014, which we've always talked about as where we felt the best as far as where we knew the room contribution was really going to bounce back in that segment, 2014 is way ahead of pace of where we actually thought it would be.
Are you back to the pace that you were in 2007?
I wouldn't say it's exactly the same pace as 2007. However, it's much more robust than it was.
Especially over several years.
If I could ask one last question. I was just wondering from other jurisdictions, if you're talking to any of the decision-makers in Singapore or in other areas, if they're pleased or if they think that you could see maybe an additional opportunity in Singapore that's not being addressed by the current hotels that are operating there. Is there any leeway that you could see new contracts being let?
I don't know, Tom. I'm not in a position to comment on that intelligently. That's a good question for Sheldon.
The same is true in Japan?
Japan-
Moves around. The current prime minister is pro-gaming. The party that is most likely to favor this is in control, but things change in Japan rather quickly. We're all watching that, and that'll be a joust if it happens.
Well-
I think that there'll be a joust. There'll be a serious effort made if Toronto decides this spring-
They want to have a privately operated casino. Everybody sort of thinks that market, heavily Chinese as it is, would be a good one. It's a world-class destination city. There's nonstop flights from every major world capital to Toronto. You don't have to change planes. I don't know about Singapore, but I know that there's a very spirited debate at the moment in Toronto.
Gamal Aziz is on the call. Gamal, this is his business, this expansion of our company, he's doing that with me. Gamal, what do you think about this? About Canada?
Steve, I think that, well, Toronto, we will know. City council votes on May 7th, we will know if they'll accept it in Toronto itself. If not, it may go to other neighboring jurisdictions like Markham, Mississauga, or Vaughan. We'll wait and see, but yes, it'll be a great market for us. Japan, I think as you said, Steve, the new prime minister is pro-gaming. For the first time, cabinet members are speaking openly about gaming and the benefits of having integrated resorts. We think that for the first time, there's hope that they will approve the promotional bill which precedes the implementation bill. We think there is movement in Japan, and we will know by the end of the year. This is probably the friendliest government towards gaming.
I'd just like to comment and thank Marc Schorr for his great commitment to the Wynn shareholders. Thanks, Mark.
Tom, Mark is going to continue in a partial role until the opening of Cotai because of his experience in building Treasure Island.
Okay
and Encore. He's going to spend a little bit more time with his family because that's what he wants to do, but he's also going to continue making regular trips to China in his role in getting that place built and open. Retirement was probably a little bit of an exaggerated term.
Yeah, Mark, I still want to thank you very much for all you've done.
Thank you.
Thanks.
Thanks.
Your next question comes the line of Robin Farley with UBS.
Hello, Robin. Are you there? I think she left.
I think we lost the call.
The next question comes from the line of Thomas Allen with Morgan Stanley.
Hi. In Las Vegas, we've heard from some of the regional operators that January and February were soft, then you saw a significant pickup in business in March. Did you experience something similar in Vegas? Both on your personal level and on the market in general would be helpful. Thank you.
No, we didn't see anything different in March than we saw in January, February. We were pretty consistent month to month as far as our business.
Yeah, I want to point out. We had a good time. We have the largest amount of gaming win in the state of Nevada for one single property. We've held that record since I opened Bellagio, then we exceeded Bellagio in 2007 with $724 million in win. Then we exceeded it last year and this year at $770 million in this hotel. Having said that we have the largest component of gaming revenue of any Nevada casino, I must point out that of the $600 million in table win, 70% of it is in roulette and baccarat, which are a business that is primarily Latin American, European, and Asian. Without the international market, we would be in an entirely different position. We are among, in addition to a few other properties on the Strip, the hotel of choice for well-to-do international travelers.
This hotel has an enormous component every single night of the week of people with foreign passports. It'd be the equivalent of a 300 or 400-room hotel in another city being 100% occupied every night of the year by people who were from another country. These are all gamblers. We don't really run with the pack, so to speak, in Las Vegas. We've got this international brand that works for us. When you ask that question, and you relate it to regional casinos, we're so completely different that I think it's not a comparable situation. We intend to do exactly that in Philadelphia and Boston. Exactly that. Toronto, if we get the chance. Show us a major city, and we'll build them a beautiful destination hotel that could be called a resort by any definition. Therefore, we get into a different category.
We get people from outside the region to come into the region. We get people from over there to come here. That's the secret of gaming. That's the only reason to have gaming, to get people to come from over there to here, wherever here is compared to over there. I tried to make that point in my presentation in Philadelphia recently. When you decide to bring people from over there to over here, you do that by having something here that's better than there, which means more money for construction, more jobs, and in the end, more tax revenue. Yeah.
That actually brings me to an interesting second question. Are you able to estimate what percentage of your Las Vegas revenue comes from Chinese customers? Just thinking, if there is some kind of issue that could stop them from traveling, how would that impact your Vegas property also?
If anything interfered with Chinese travel to the United States, would it impact our property? Roughly the equivalent of the buildings falling down. Nothing serious, just a catastrophe, that's all. A catastrophe. If you want to have anxiety about potential scenarios that could cause problems, you just pick one right there. We're not having an anxiety attack on that point, nor have we worried about it for the past 30 or 40 years. No, the Chinese are on the move. The Japanese are on the move. The Taiwanese are on the move.
Latin America.
Latin America, Brazil, Chile, Colombia. We have big business this first quarter from Chile, Colombia, Brazil, Mexico, Taiwan, Japan, Singapore, Malaysia, Indonesia, and the People's Republic