**Melco Resorts Considers Selling City of Dreams Manila**
Melco Resorts may potentially sell City of Dreams Manila. Analysts speculate that selling its assets in either City of Dreams Manila or City of Dreams Mediterranean in Cyprus could support a complete takeover of Studio City in Macau and provide financial strength for future projects in Thailand.
Vitaly Umansky, an analyst at Seaport Research Partners, commented: “Outside Macau, the Philippines (City of Dreams Manila) continues to generate cash but lacks real growth dynamics due to increasing Manila competition, while Cyprus has been a disappointment partly due to Russia and Israel. We remain of the view that Melco would be better off at this stage, with low valuation and high debt, to try to sell its Philippines and Cyprus assets and reallocate the capital.”
Melco has not confirmed the speculation, only stating that it is “evaluating potential strategic alternatives in relation to City of Dreams Manila.”
Melco stated: “Melco has retained CBRE Capital Advisors, Inc. and Moelis & Company LLC as financial advisors to assist in the process of exploring potential strategic alternatives for City of Dreams Manila. No decision has been made regarding any strategic alternative and there can be no assurance that the exploration of potential strategic alternatives will result in any transaction. Melco does not intend to comment on or provide updates in relation to this process unless and until it determines that further disclosure is appropriate or required.”
This announcement coincided with Melco’s financial results for the fourth quarter and the full year ending December 31, 2024. The full-year results were impressive, with Melco Resorts generating revenues of US$4.64 billion, a significant increase from US$3.78 billion in the prior year, driven by the ongoing recovery in inbound tourism to Macau in 2024 and the ramp-up of operations following the opening of Studio City Phase 2 and City of Dreams Mediterranean in mid-2023.
Total operating revenues for the fourth quarter of 2024 were US$1.19 billion, reflecting an increase of approximately nine percent from US$1.09 billion in 2023, attributable to improved performance in all gaming segments and non-gaming operations.
Lawrence Ho, Chairman and Chief Executive Officer, commented: “2024 was a year of transition for us in Macau. We invested in our business to enhance the customer experience and to build a stronger foundation for growth. The contributions from these initiatives are now evident with market share in the fourth quarter of 2024 growing month-to-month and property visitation exceeding pre-pandemic levels. We are committed to continuing to deliver on our strategic objectives and expect to continue to unveil new and exciting projects to support the ongoing growth in Macau.
“City of Dreams Manila had a strong quarter with a sequential increase in property EBITDA as well as market share. City of Dreams Mediterranean and our satellite casinos in Cyprus exhibited solid results despite the challenges posed by the conflicts in the region.
“And last, but not least, the development of the casino at City of Dreams Sri Lanka is progressing well and we expect to commence casino operations in the third quarter of 2025.”
Macau presented mixed results for Melco. For the quarter ended December 31, 2024, total operating revenues at City of Dreams in Macau slightly fell to US$591.1 million, compared with US$559.8 million in the fourth quarter of 2023, due to higher operating costs largely from an increase in staffing levels to enhance service quality and improve performance.
Altira Macau decreased to US$31.2 million, compared with US$33.6 million in the fourth quarter of 2023.
For the quarter ended December 31, 2024, total operating revenues at Studio City rose to US$342 million, compared with US$302.5 million in the fourth quarter of 2023.
Studio City has strategically repositioned itself to focus on the premium mass and mass segments, and VIP rolling chip operations at Studio City were transferred to City of Dreams in late October 2024.
City of Dreams Manila exhibited strong growth with revenues reaching US$133.8 million, compared with US$120.5 million in the fourth quarter of 2023.
In Cyprus, revenues at City of Dreams Mediterranean and Other grew to US$59.2 million, compared with US$47.3 million in the fourth quarter of 2023.