Melco Resorts & Entertainment has become the second major operator to outline its commitment to developing an integrated resort in Japan following the recent withdrawal from the market of several major US gaming firms.
Speaking to analysts during the company’s 2Q20 earnings call on Thursday, Melco Chairman and CEO Lawrence Ho noted that “a number of our global competitors have abandoned their efforts in Japan” – a reference to the withdrawal of Las Vegas Sands and the closure of Wynn Resorts’ Yokohama office – but insisted the Macau-based operator would not be following suit.
“We continue to believe that Japan represents the best new integrated resort development opportunity outside of Macau, and we are unwavering in our commitment to bring the world’s leading IR to Japan,” he said.
“We know that a number of our global competitors have abandoned their efforts in Japan. I’m pleased to differentiate Melco and demonstrate our long-term commitment to Japan.
“When I entered this race more than a decade ago, I knew it was a marathon and not a sprint. Frankly, while COVID has certainly impacted development efforts in the near term, based on all the news flow out of the medical community, COVID will be well on the rearview mirror when IR actually opens in Japan in the back half of this decade.
“Our global team continues to work and plan remotely, and our local Japan team continues to diligently work and meet with key stakeholders to discuss and refine our integrated resort development plan.”
Ho’s comments come a week after Galaxy Entertainment Group also confirmed its commitment to Japan, with Chairman Lui Che Woo stating, “We do acknowledge that timelines for Japan may be impacted by the worldwide pandemic of COVID-19, however we can adjust accordingly and we remain committed to our Japan expansion plans.”
In contrast, Las Vegas Sands announced its withdrawal from Japan in May with Chairman and CEO Sheldon Adelson stating the “framework around the development of an IR has made our goals there unreachable.”
Wynn Resorts CEO Matt Maddox revealed earlier this month that the company had shuttered its Yokohama office back in March, adding, “We decided that until there is more clarity on what the business is going to look like, what the world is going to look like and what the regulations really are over there we’re pretty much ceasing our efforts.”
MGM remains the sole candidate in Osaka but President and CEO Bill Hornbuckle said in late July, “We like that we are not fully ‘all-in’ on this investment and we like the fact that there is probably going to be a delay and a reopening of some of the conversations that will hopefully make this a better investment for anyone that is interested in it, most notably us.”
Previous Chairman and CEO Jim Murren had never expressed such reservations.
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