Table of Contents

 

 

FORM 6-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

REPORT OF FOREIGN ISSUER

PURSUANT TO RULE 13a–16 OR 15d–16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2023

Commission File Number: 001-38699

 

 

STUDIO CITY INTERNATIONAL HOLDINGS LIMITED

 

 

71 Robinson Road

#04-03

Singapore 068895

and

38th Floor, The Centrium

60 Wyndham Street

Central

Hong Kong

(Address of principal executive offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20–F or Form 40– F.

Form 20-F ☒   Form 40-F ☐

 

 

 

Table of Contents

STUDIO CITY INTERNATIONAL HOLDINGS LIMITED

Form 6–K

TABLE OF CONTENTS

 

Signature

      3  

 

Exhibit 99.1
   

 

2

Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

STUDIO CITY INTERNATIONAL HOLDINGS LIMITED
By:   /s/ Geoffrey Davis
Name:   Geoffrey Davis, CFA
Title:   Chief Financial Officer

Date: November 8, 2023

 

3

Table of Contents

EXHIBIT INDEX

 

Exhibit No.   

Description

Exhibit 99.1    Unaudited Results for Third Quarter of 2023

 

4

Exhibit 99.1

 

LOGO

Studio City International Holdings Limited Announces Unaudited Third Quarter 2023 Earnings

MACAU, Nov. 07, 2023 (GLOBE NEWSWIRE) — Studio City International Holdings Limited (NYSE: MSC) (“Studio City” or the “Company”), a world-class integrated resort located in Cotai, Macau, today reported its unaudited financial results for the third quarter of 2023.

Total operating revenues for the third quarter of 2023 were US$137.6 million, compared with total operating revenues of negative US$2.8 million in the third quarter of 2022. The change was primarily attributable to the relaxation of COVID-19 related restrictions in Macau in January 2023 and the opening of Studio City Phase 2, which led to an increase in revenue from casino contract and higher non-gaming revenues.

Studio City Casino generated gross gaming revenues of US$256.3 million and US$20.6 million for the third quarters of 2023 and 2022, respectively.

Studio City Casino’s rolling chip volume was US$713.6 million in the third quarter of 2023 versus US$42.1 million in the third quarter of 2022. The rolling chip win rate was 1.78% in the third quarter of 2023 versus 4.18% in the third quarter of 2022. The expected rolling chip win rate range is 2.85%- 3.15%.

Mass market table games drop increased to US$809.1 million in the third quarter of 2023, compared with US$61.9 million in the third quarter of 2022. The mass market table games hold percentage was 27.5% in the third quarter of 2023, compared with 25.6% in the third quarter of 2022.

Gaming machine handle for the third quarter of 2023 was US$673.9 million, compared with US$98.2 million in the third quarter of 2022. The gaming machine win rate was 3.2% in the third quarter of 2023, compared with 3.1% in the third quarter of 2022.

Revenue from casino contract was US$48.6 million for the third quarter of 2023, compared with revenue from casino contract of negative US$18.2 million for the third quarter of 2022. Revenue from casino contract is net of gaming taxes and the costs incurred in connection with the on-going operation of the Studio City Casino which are deducted by Melco Resorts (Macau) Limited, the gaming operator of the Studio City Casino (the “Gaming Operator”).

Total gaming taxes and the costs incurred in connection with the on-going operation of the Studio City Casino deducted from gross gaming revenues were US$207.7 million and US$38.8 million in the third quarters of 2023 and 2022, respectively.

Total non-gaming revenues at Studio City for the third quarter of 2023 were US$89.0 million, compared with US$15.4 million for the third quarter of 2022.

Operating income for the third quarter of 2023 was US$3.2 million, compared with operating loss of US$72.5 million in the third quarter of 2022.

Studio City generated Adjusted EBITDA(1) of US$56.3 million in the third quarter of 2023, compared with negative Adjusted EBITDA of US$39.5 million in the third quarter of 2022. The change was mainly attributable to the increase in revenue from casino contract and higher non-gaming revenues.

Net loss attributable to Studio City International Holdings Limited for the third quarter of 2023 was US$28.4 million, compared with net loss attributable to Studio City International Holdings Limited of US$85.2 million in the third quarter of 2022. The net loss attributable to participation interest was US$2.7 million and US$8.0 million in the third quarters of 2023 and 2022, respectively.

Other Factors Affecting Earnings

Total net non-operating expenses for the third quarter of 2023 were US$34.3 million, which mainly included interest expenses of US$36.4 million, partially offset by interest income of US$2.8 million.

Depreciation and amortization costs of US$45.4 million were recorded in the third quarter of 2023, of which US$0.8 million was related to the amortization expense for the land use right.

The Adjusted EBITDA for Studio City for the three months ended September 30, 2023 referred to in the earnings release of Melco Resorts & Entertainment Limited (“Melco”) dated November 7, 2023 (“Melco’s earnings release”) is US$11.5 million more than the Adjusted EBITDA of Studio City contained in this press release. The Adjusted EBITDA of Studio City contained in this press release includes certain intercompany charges that are not included in the Adjusted EBITDA for Studio City contained in Melco’s earnings release. Such intercompany charges include, among other items, fees and shared service charges billed between the Company and its subsidiaries and certain subsidiaries of Melco. Additionally, Adjusted EBITDA of Studio City included in Melco’s earnings release does not reflect certain gaming concession related costs and certain intercompany costs related to the table games operations at Studio City Casino.

 

1

Financial Position and Capital Expenditures

Total cash and bank balances as of September 30, 2023 aggregated to US$293.1 million (December 31, 2022: US$509.7 million), including US$0.1 million of restricted cash (December 31, 2022: US$0.1 million). Total debt, net of unamortized deferred financing costs and original issue premiums, at the end of the third quarter of 2023 was US$2.43 billion (December 31, 2022: US$2.43 billion).

Capital expenditures for the third quarter of 2023 were US$14.8 million.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Studio City International Holdings Limited (the “Company”) may also make forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. These factors include, but are not limited to, (i) COVID-19 outbreaks, and the impact of its consequences on our business, our industry and the global economy, (ii) risks associated with the newly adopted gaming law in Macau and its implementation by the Macau government, (iii) changes in the gaming market and visitations in Macau, (iv) capital and credit market volatility, (v) local and global economic conditions, (vi) our anticipated growth strategies, (vii) gaming authority and other governmental approvals and regulations, and (viii) our future business development, results of operations and financial condition. In some cases, forward-looking statements can be identified by words or phrases such as “may”, “will”, “expect”, “anticipate”, “target”, “aim”, “estimate”, “intend”, “plan”, “believe”, “potential”, “continue”, “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Non-GAAP Financial Measures

 

(1)

“Adjusted EBITDA” is defined as net income/loss before interest, taxes, depreciation, amortization, pre-opening costs, property charges and other and other non-operating income and expenses. We believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results. This non-GAAP financial measure eliminates the impact of items that we do not consider indicative of the performance of our business. While we believe that this non-GAAP financial measure is useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared in accordance with U.S. GAAP. It should not be considered in isolation or construed as an alternative to net income/loss, cash flow or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. The use of Adjusted EBITDA has material limitations as an analytical tool, as Adjusted EBITDA does not include all items that impact our net income/loss. In addition, the Company’s calculation of Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measure to its most directly comparable GAAP financial measure. Reconciliations of Adjusted EBITDA with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.

 

(2)

“Adjusted net income/loss” is net income/loss before pre-opening costs, property charges and other and gain on extinguishment of debt, net of participation interest. Adjusted net income/loss is presented as supplemental disclosure because management believes it provides useful information to investors and others in understanding and evaluating our performance, in addition to income/loss computed in accordance with U.S. GAAP. Adjusted net income/loss may be different from the calculation methods used by other companies and, therefore, comparability may be limited. Reconciliations of adjusted net income/loss attributable to Studio City International Holdings Limited with the most comparable financial measures calculated and presented in accordance with U.S. GAAP are provided herein immediately following the financial statements included in this press release.

About Studio City International Holdings Limited

The Company, with its American depositary shares listed on the New York Stock Exchange (NYSE: MSC), is a world-class integrated resort located in Cotai, Macau. For more information about the Company, please visit www.studiocity-macau.com.

The Company is majority owned by Melco Resorts & Entertainment Limited, a company with its American depositary shares listed on the Nasdaq Global Select Market (Nasdaq: MLCO).

 

2

For the investment community, please contact:

Jeanny Kim

Senior Vice President, Group Treasurer

Tel: +852 2598 3698

Email: jeannykim@melco-resorts.com

For media enquiries, please contact:

Chimmy Leung

Executive Director, Corporate Communications

Tel: +852 31513765

Email: chimmyleung@melco-resorts.com

 

3

Studio City International Holdings Limited and Subsidiaries

Condensed Consolidated Statements of Operations (Unaudited)

(In thousands, except share and per share data)

 

     Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
     2023     2022     2023     2022  

Operating revenues:

         

Revenue from casino contract

    $ 48,614     $ (18,166 )    $ 98,546     $ (44,171 ) 

Rooms

      32,819       3,527       72,091       13,566  

Food and beverage

      19,295       3,509       42,611       12,855  

Entertainment

      24,747       871       58,785       1,175  

Services fee

      8,307       5,033       22,569       16,215  

Mall

      2,945       1,246       7,583       5,800  

Retail and other

      859       1,187       2,102       1,871  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total operating revenues

      137,586       (2,793 )      304,287       7,311  
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating costs and expenses:

         

Costs related to casino contract

      (7,297 )      (9,622 )      (21,265 )      (21,864 ) 

Rooms

      (8,015 )      (2,884 )      (17,920 )      (8,476 ) 

Food and beverage

      (16,319 )      (5,162 )      (37,089 )      (18,241 ) 

Entertainment

      (17,870 )      (536 )      (49,352 )      (1,704 ) 

Mall

      (1,282 )      (979 )      (2,770 )      (3,041 ) 

Retail and other

      (589 )      (273 )      (1,543 )      (904 ) 

General and administrative

      (29,943 )      (17,280 )      (79,904 )      (59,457 ) 

Pre-opening costs

      (7,623 )      (785 )      (17,620 )      (1,731 ) 

Amortization of land use right

      (826 )      (823 )      (2,474 )      (2,474 ) 

Depreciation and amortization

      (44,557 )      (31,029 )      (116,189 )      (92,854 ) 

Property charges and other

      (57 )      (369 )      (540 )      (3,790 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total operating costs and expenses

      (134,378 )      (69,742 )      (346,666 )      (214,536 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating income (loss)

      3,208       (72,535 )      (42,379 )      (207,225 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Non-operating income (expenses):

         

Interest income

      2,821       2,458       8,173       4,187  

Interest expenses, net of amounts capitalized

      (36,362 )      (23,181 )      (93,806 )      (70,430 ) 

Other financing costs

      (105 )      (104 )      (311 )      (311 ) 

Foreign exchange (losses) gains, net

      (692 )      162       2,521       6,402  

Other expenses, net

      —        —        (61 )      —   

Gain on extinguishment of debt

      80       —        80       —   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total non-operating expenses, net

      (34,258 )      (20,665 )      (83,404 )      (60,152 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Loss before income tax

      (31,050 )      (93,200 )      (125,783 )      (267,377 ) 

Income tax benefit (expense)

      11       9       77       (485 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net loss

      (31,039 )      (93,191 )      (125,706 )      (267,862 ) 

Net loss attributable to participation interest

      2,669       8,016       10,813       26,817  
  

 

 

    

 

 

    

 

 

    

 

 

  

Net loss attributable to Studio City International Holdings Limited

    $ (28,370 )    $ (85,175 )    $ (114,893 )    $ (241,045 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net loss attributable to Studio City International Holdings Limited per Class A ordinary share:

         

Basic

    $ (0.037 )    $ (0.111 )    $ (0.149 )    $ (0.349 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

    $ (0.037 )    $ (0.111 )    $ (0.149 )    $ (0.351 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net loss attributable to Studio City International Holdings Limited per ADS:

         

Basic

    $ (0.147 )    $ (0.442 )    $ (0.597 )    $ (1.396 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

    $ (0.147 )    $ (0.442 )    $ (0.597 )    $ (1.404 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average Class A ordinary shares outstanding used in net loss attributable to Studio City International Holdings Limited per Class A ordinary share calculation:

         

Basic

      770,352,700       770,352,700       770,352,700       690,440,759  
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

      770,352,700       770,352,700       770,352,700       762,952,519  
  

 

 

    

 

 

    

 

 

    

 

 

  

 

4

Studio City International Holdings Limited and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

 

     September 30,
2023		     December 31,
2022		  
     (Unaudited)        

ASSETS

     

Current assets:

     

Cash and cash equivalents

    $ 292,951     $ 509,523  

Accounts receivable, net

      1,100       263  

Receivables from affiliated companies

      40,479       221  

Inventories

      5,735       5,121  

Prepaid expenses and other current assets

      39,780       38,721  
  

 

 

    

 

 

  

Total current assets

      380,045       553,849  
  

 

 

    

 

 

  

Property and equipment, net

      2,802,281       2,868,064  

Intangible assets, net

      346       1,373  

Long-term prepayments, deposits and other assets

      22,214       48,325  

Restricted cash

      129       130  

Operating lease right-of-use assets

      11,601       13,136  

Land use right, net

      105,875       108,645  
  

 

 

    

 

 

  

Total assets

    $ 3,322,491     $ 3,593,522  
  

 

 

    

 

 

  

LIABILITIES, SHAREHOLDERS’ EQUITY AND PARTICIPATION INTEREST

     

Current liabilities:

     

Accounts payable

    $ 1,992     $ 501  

Accrued expenses and other current liabilities

      107,227       165,688  

Income tax payable

      4       22  

Payables to affiliated companies

      22,712       81,178  
  

 

 

    

 

 

  

Total current liabilities

      131,935       247,389  
  

 

 

    

 

 

  

Long-term debt, net

      2,434,981       2,434,476  

Other long-term liabilities

      3,024       21,631  

Deferred tax liabilities, net

      318       382  

Operating lease liabilities, non-current

      11,985       13,499  
  

 

 

    

 

 

  

Total liabilities

      2,582,243       2,717,377  
  

 

 

    

 

 

  

Shareholders’ equity and participation interest:

     

Class A ordinary shares, par value $0.0001; 1,927,488,240 shares authorized; 770,352,700 shares issued and outstanding

      77       77  

Class B ordinary shares, par value $0.0001; 72,511,760 shares authorized; 72,511,760 shares issued and outstanding

      7       7  

Additional paid-in capital

      2,477,359       2,477,359  

Accumulated other comprehensive losses

      (20,985 )      (11,671 ) 

Accumulated losses

      (1,780,059 )      (1,665,166 ) 
  

 

 

    

 

 

  

Total shareholders’ equity

      676,399       800,606  
  

 

 

    

 

 

  

Participation interest

      63,849       75,539  
  

 

 

    

 

 

  

Total shareholders’ equity and participation interest

      740,248       876,145  
  

 

 

    

 

 

  

Total liabilities, shareholders’ equity and participation interest

    $ 3,322,491     $ 3,593,522  
  

 

 

    

 

 

  

 

5

Studio City International Holdings Limited and Subsidiaries

Reconciliation of Net Loss Attributable to Studio City International Holdings Limited to

Adjusted Net Loss Attributable to Studio City International Holdings Limited (Unaudited)

(In thousands, except share and per share data)

 

     Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
     2023     2022     2023     2022  

Net loss attributable to Studio City International Holdings Limited

    $ (28,370 )    $ (85,175 )    $ (114,893 )    $ (241,045 ) 

Pre-opening costs

      7,623       785       17,620       1,731  

Property charges and other

      57       369       540       3,790  

Gain on extinguishment of debt

      (80 )      —        (80 )      —   

Participation interest impact on adjustments

      (653 )      (99 )      (1,555 )      (712 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted net loss attributable to Studio City International Holdings Limited

    $ (21,423 )    $ (84,120 )    $ (98,368 )    $ (236,236 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted net loss attributable to Studio City International Holdings Limited per Class A ordinary share:

         

Basic

    $ (0.028 )    $ (0.109 )    $ (0.128 )    $ (0.342 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

    $ (0.028 )    $ (0.109 )    $ (0.128 )    $ (0.344 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted net loss attributable to Studio City International Holdings Limited per ADS:

         

Basic

    $ (0.111 )    $ (0.437 )    $ (0.511 )    $ (1.369 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

    $ (0.111 )    $ (0.437 )    $ (0.511 )    $ (1.375 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average Class A ordinary shares outstanding used in adjusted net loss attributable to Studio City International Holdings Limited per Class A ordinary share calculation:

         

Basic

      770,352,700       770,352,700       770,352,700       690,440,759  
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

      770,352,700       770,352,700       770,352,700       762,952,519  
  

 

 

    

 

 

    

 

 

    

 

 

  

 

6

Studio City International Holdings Limited and Subsidiaries

Reconciliation of Operating Income (Loss) to Adjusted EBITDA (Unaudited)

(In thousands)

 

                                                                                           
    Three Months Ended
September 30,		      Nine Months Ended
September 30,		  
    2023        2022      2023      2022  

Operating income (loss)

   $ 3,208        $ (72,535 )     $ (42,379 )     $ (207,225 ) 

Pre-opening costs

     7,623          785        17,620        1,731  

Depreciation and amortization

     45,383          31,852        118,663        95,328  

Property charges and other

     57          369        540        3,790  
 

 

 

       

 

 

     

 

 

     

 

 

  

Adjusted EBITDA

   $     56,271        $    (39,529 )     $    94,444      $  (106,376 ) 
 

 

 

       

 

 

     

 

 

     

 

 

  

 

7

Studio City International Holdings Limited and Subsidiaries

Reconciliation of Net Loss Attributable to Studio City International Holdings Limited

to Adjusted EBITDA (Unaudited)

(In thousands)

 

     Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
     2023     2022     2023     2022  

Net loss attributable to Studio City International Holdings Limited

    $ (28,370 )    $ (85,175 )    $ (114,893 )    $ (241,045 ) 

Net loss attributable to participation interest

      (2,669 )      (8,016 )      (10,813 )      (26,817 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net loss

      (31,039 )      (93,191 )      (125,706 )      (267,862 ) 

Income tax (benefit) expense

      (11 )      (9 )      (77 )      485  

Interest and other non-operating expenses, net

      34,258       20,665            83,404       60,152  

Depreciation and amortization

           45,383            31,852       118,663            95,328  

Property charges and other

      57       369       540       3,790  

Pre-opening costs

      7,623       785       17,620       1,731  
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted EBITDA

    $ 56,271     $ (39,529 )    $ 94,444     $ (106,376 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

 

8

Studio City International Holdings Limited and Subsidiaries

Supplemental Data Schedule

 

     Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
     2023     2022     2023     2022  

Room Statistics(3):

         

Average daily rate (4)

    $ 167     $ 107     $ 148     $ 114  

Occupancy per available room

      92 %      25 %      88 %      27 % 

Revenue per available room (5)

    $ 155     $ 27     $ 129     $ 31  

Other Information(6):

         

Average number of table games

      246       277       246       277  

Average number of gaming machines

      661       702       667       711  

Table games win per unit per day (7)

    $ 10,380     $ 794     $ 8,331     $ 1,592  

Gaming machines win per unit per day (8)

    $ 352     $ 54     $ 319     $ 82  

 

(3)

Room statistics exclude rooms that were temporarily closed or provided to staff members due to the COVID-19 outbreak

(4)

Average daily rate is calculated by dividing total room revenues including complimentary rooms (less service charges, if any) by total occupied rooms including complimentary rooms

(5)

Revenue per available room is calculated by dividing total room revenues including complimentary rooms (less service charges, if any) by total rooms available

(6)

Table games and gaming machines that were not in operation due to government-mandated closures or social distancing measures in relation to the COVID-19 outbreak have been excluded

(7)

Table games win per unit per day is shown before discounts, commissions, non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis

(8)

Gaming machines win per unit per day is shown before non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis

 

9

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