Melco Resorts & Entertainment Limited

Ladies and gentlemen, thank you for participating in the second quarter 2020 earnings conference call of Melco Resorts & Entertainment Limited. At this time, all participants are in listen-only mode. After the call, we will conduct a question-and-answer session. Today's conference has been recorded. I would now like to turn the call over to Mr. Richard Hong, Director of Investor Relations of Melco Resorts & Entertainment Limited. Thank you. Please go ahead, sir.

Thank you, operator, and thank you all for joining us today for our second quarter 2020 earnings call. On the call today are Lawrence Ho, Geoff Davis, Evan Winkler, and our property presidents in Macau and Manila. Before we get started, please note that today's discussion may contain forward-looking statements made under the safe harbor provision of federal securities law. Our actual results could differ from our anticipated results. I'll now turn the call over to Lawrence.

Thank you, Richard, and hello, everyone. I hope all of you and your loved ones are safe and sound during these challenging times. I would like to once again express my sincere gratitude to the Macau Chief Executive for his proactive response to contain the spread of the virus and for his prudent, cautious approach towards reopening the economy. I'm glad also to report that Macau is largely unharmed by typhoon eagles, Our properties remained open with no loss of power. However, some parts of the city were affected. Within 24 hours, Melco was the first to reach out to the community and in conjunction with the government to provide aid where needed. Moving on to our results. During the second quarter, our operating and financial performance was severely impacted by COVID-19. To mitigate its impact, We have been quick to formulate strategies to preserve liquidity and to improve the state of health of our balance sheet. Recently, we further optimized our capital structure and increased our liquidity on hand with a series of capital market transactions, which Geoff will go through in detail later. Over the past month, we've been excited to see some early signs of normalization in our integrated resort operations. In the middle of June, operations at Cyprus casinos partially resumed. Beginning in the middle of July, we began to see a gradual relaxation of travel restrictions between China and Macau, with travelers from Macau permitted to enter nine cities in Guangdong without being subject to 14-day mandatory quarantine. That loosening of travel restrictions was extended to the entire Guangdong province on July 29th. On August 12th, Chinese authorities resumed issuance of IDF and tour group visas for Zhuhai residents. We look forward to the resumption of IDF visa issuance expanding to cover Guangdong on August 26th and to cover the entire nation on September 23rd. It will also likely take a week or two for the logistics to be worked out. So we expect benefits from these relaxations to start flowing through from September onwards. While we are eager to resume our integrated resort operations, ensuring the safety and well-being of our colleagues, customers, and the communities in which we operate remains our highest priority. We continue to expect a faster rebound and faster growth in the premium gaming segment. which benefits Melco's portfolio of luxury integrated resorts. It has also enabled Melco to meaningfully outperform you today in 2020, setting us up nicely for the expected recovery in the second half of the year. To strengthen our leadership in premium math, we have made good use of the past few months to accelerate various upgrade projects at City of Dreams. with the fully renovated Nuwa Hotel Tower currently anticipated to reopen by year end. Despite COVID-19, Melco remains committed to its global development program. Our next major project in Macau will be Studio City Phase 2. Upon completion, the Phase 2 expansion will increase Studio City's hotel room inventory by approximately 60% with two new hotel towers offering approximately 900 luxury hotel rooms and suites. In addition to an expansion of the gaming space, Phase 2 will also offer new non-gaming attractions that are highly complementary to those in Phase 1, including a Cineplex, one of the world's largest indoor-outdoor water parks, fine dining restaurants, and state-of-the-art MySpace. In Cyprus, we're developing City of Dreams Mediterranean. Construction restarted on May 6. Upon completion, COD Mediterranean will be Europe's largest integrated resort, offering over 100 gaming tables, 1,000 slot machines, and 500 hotel rooms. Turning to Japan. 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. 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 in the rearview mirror when IRs actually open 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. Hopefully, COVID permitting, I will be able to visit Japan again soon in person. Last, I want to reiterate our bullishness on Melco's medium and long-term growth prospects. Macau remains the most attractive integrated resort market in the world. benefiting from the expanding Chinese middle class and infrastructure development in the Greater Bay Area, including the long-awaited Hangcheng Port checkpoint and the extended train line from Zhuhai, which commenced operations just a few days ago. We have one of the most exciting global development pipelines that will allow us to reap the benefits of favorable market dynamics, Our recent capital market transactions have also strengthened our balance sheet, enabling us to overcome near-term challenges while investing for the future. With that, I turn to Jeff to go through some of the numbers.