Ladies and gentlemen, thank you for participating in the Fourth Quarter 2025 Earnings Conference Call of Melco Resorts & Entertainment Limited. [Operator Instructions] Today's conference is being recorded. I would now like to turn the call over to Jeanny Kim, Senior Vice President, Group Treasurer of Melco Resorts & Entertainment Limited. Please go ahead.

Thank you, operator, and thank you all for joining us today for our fourth quarter 2025 earnings call. On the call are Lawrence Ho, Geoff Davis, Evan Winkler and our Property Presidents in Macau, Manila and Cyprus. Before we get started, please note that today's discussion may contain forward-looking statements made under the safe harbor provision of federal securities laws. Our actual results could differ from our anticipated results. In addition, we may discuss non-GAAP measures. A definition and reconciliation of each of these measures to the most comparable GAAP financial measures are included in the earnings release. Finally, please note that our supplementary earnings slides are posted on our Investor Relations website. With that, I'll turn the call over to Mr. Lawrence Ho.

Thank you, Jeanny, and thank you all for joining us today. 2025 was a year of growth and recovery, supported by disciplined cost management and margin expansion. We recorded $1.4 billion in group property EBITDA for the full year of 2025, growing by 17% compared to 2024. In Macau, our dedicated efforts to enhance the customer experience have proven to be a successful strategic focus with fourth quarter Macau property EBITDA growing 24% year-over-year and full year Macau property EBITDA growing 25% compared to 2024. We've had a strong start to 2026 with Macau market GGR up by 24% year-over-year and our market share increasing so far in the first quarter of 2026. Chinese New Year looks strong with higher-yielding cash ADRs compared to 2025. We have a pipeline of new initiatives that we're planning to implement in 2026 to further differentiate our offerings with the largest project being the opening of the renovated Countdown hotel. We are on track to progressively start opening in the third quarter of 2026. The completed hotel is expected to introduce a truly distinctive experience and set a new benchmark in Macau. We have also started on a revamp of the retail area at COD and have plans to upgrade our F&B offerings, continuing to further enhance our product quality. In the Philippines, competitive pressures and industry headwinds continue to impact our performance in the fourth quarter of 2025. However, we're encouraged by the positive developments in that market, including visa-free travel for Chinese nationals, upgrades to the Macau -- to the Manila Airport to facilitate increasing international tourism and rationalization of the online gaming market. We have also concluded our evaluation of the strategic alternatives for COD Manila. Although we considered various alternatives, we did not feel that any of those options would allow the value and potential of the property to be fully realized. We're confident that business will rebound, and we may reevaluate the situation in the future. Moving on to Cyprus. City of Dreams Mediterranean and the satellite casinos in Cyprus achieved 78% year-over-year growth in property EBITDA to $21 million for the fourth quarter of 2025, despite seasonality typically being slower in these months. And finally, in Sri Lanka, we continue to focus our efforts to progressively ramp up operations and have seen promising green shoots so far in 2026. With that, I turn the call over to Geoff.

Thank you, Lawrence. Our group-wide adjusted property EBITDA for the fourth quarter of 2025 grew 12% year-over-year to approximately $331 million. Adjusted for VIP hold, our property EBITDA was approximately $323 million. Favorable win rates at COD Macau and COD Manila had positive impacts on our property EBITDA by approximately $7 million and $3 million, respectively. We had guided in the prior quarterly call -- as we had guided in the prior quarterly call, OpEx in Macau increased in the fourth quarter compared to the prior quarter, primarily due to events, including the China National Games, Studio City's 10th anniversary and the Macau Grand Prix. Excluding these fourth quarter events as well as House of Dancing Water, Macau OpEx was approximately $3.1 million per day. EBITDA in the fourth quarter of 2025 was also impacted by additional bad debt provisions that were taken as a result of a settlement that we reached with one of the previous junket operators. Adjusting for these event-driven costs, Macau's property EBITDA margin for the fourth quarter of 2025 would have been over 27% on an actual basis. Looking forward to the first quarter of 2026, we expect Macau daily OpEx, excluding House of Dancing Water, to come in at approximately $3.2 million, given increased marketing activity around Chinese New Year and new brand campaigns across our Macau properties. Turning to our balance sheet. Our liquidity position remains robust. We had available liquidity of approximately $2.4 billion with consolidated cash on hand of approximately $1.2 billion as of the end of 2025. Melco, excluding its operations at Studio City, the Philippines, Cyprus and Sri Lanka, accounted for approximately $550 million of the consolidated cash on hand. In the fourth quarter of 2025, Melco redeemed the remaining $358 million of the senior notes due 2026. In…

[Operator Instructions] And today's first question comes from Joe Stauff at Susquehanna.

I wanted to ask about the additional traffic, obviously being generated by House of Dancing Water and kind of where you are with respect to being able to convert that additional daily visitation into both gaming and obviously, other parts of your business. What is the opportunity from here as we think about that?

Joe, it's Lawrence. So since we've opened House of Dancing Water in May -- reopened House of Dancing Water in May of last year, we've seen meaningful uptick in property's visitation. The show is open pretty much twice a day for 5 days of the week. And during those days that adds, each show is about 1,800, 1,900 people. So that drives additional headcount into the property. I think we're seeing meaningfully good spend across non-gaming during and after the show. And even on our mass drop, I think from pre-May to post-May, we had seen a decent uptick. I think that's kind of -- as with any non-gaming entertainment concerts attractions in Macau, how does that -- how can we directly track that scientifically. I don't think we have an answer for that. I'll maybe let Evan talk about it. But I think overall, we see it's driving traffic and energy into the building and...

It's a little more -- as Lawrence has pointed out, it's a little more difficult from a direct drive standpoint. It's very helpful in activating the property. We do see a big uptick, obviously, in food and beverage spending on property during the show. Generally, when people are coming from outside the property to the show for that initial event, sometimes they're coming with family and friends. So a very small percentage go from that directly to gaming. The benefit we have is it does introduce thousands of more people with each show to the property and to COD to our product, to food and beverage. And so I think over time, it's generating repeat visits back to the property, but it's hard to go from who exited the show that day to who comes back later on. So I think we drive, but we don't have a direct formula that we can give you because if you look at the individual people coming out of the show on the night that they go to show to see the show, that's not a high number. But overall, we're seeing uplift in the business.

And our next question today comes from Timothy Chau at Citigroup.

Can you hear me clearly, please?

Yes, we can hear you.

All right. So a question for me. What is your view on the competitive intensity in Macau? And more specifically, what are your expectations on your EBITDA margins, particularly in Macau this year, please?

Timothy, it's Lawrence. So maybe I'll start and then I'll hand it over to Evan and Geoff. I think the competition is still very intense in Macau, but can be expected. I would say that we anticipate this level of competition to be what we will expect for the rest of the year. In terms of -- mass is still growing. So I think we're comfortable with our margin. And I think we've been very, very disciplined throughout 2025 in terms of our reinvestment. And we've seen some of our competitors ratcheted up throughout the year. And so I think we're -- I don't know, unless there's anything you want to supplement, Evan...

No. Look, I think from where we're sitting coming out of Q4 and into this quarter, we're not seeing a ratchet up in terms of levels of spend directly on gaming programs from where we are now. Competition remains, as Lawrence said, intense within the marketplace. We're not looking at any catalysts that would immediately bring that down. The hope that we always have is as people look at things that you have easing up among players. So as Lawrence has said and I've said in the past, we don't ever drive up in the marketplace. We tend to be very disciplined. We'll make strategic moves at times when we need to look at market share or move around with individual segments, but we certainly would never leave the market up. Based on what we're seeing now, I think we're stable. I don't see anything that's going to bring us down in the near term, but I also don't see anything that's going to ratchet it up.

I think on margin, we've done a pretty good job in terms of managing our operating costs throughout 2025. That's part of the company philosophy as well. So I think that -- you'll see that ongoing throughout 2026.

[Operator Instructions] Our next question today comes from D. S. Kim at JPMorgan.

My first question is regarding the operating expense. As Geoff mentioned earlier, I think we had quite a bit of nonrecurring items this quarter, 10-year anniversary National Games and even junket-related bad debt. And can you help quantify each of this in dollar terms for us, if it's possible? And can I confirm the spending related to National Games and Grand Prix were included in OpEx operating expense above EBITDA line and not in the corporate expense?

Those expenses are in our property margins. The additional bad debt was approximately $5 million for the quarter, and we expect that to come back down to more normal levels going forward. And then we had about $6 million from the anniversary.

And our next question today comes from John DeCree of CBRE.

Maybe just one on CapEx, Geoff, I apologize if I missed it. Did you give us the CapEx number for the year? And could you break it out for major projects maybe by COD or Studio City at the property level, what we should expect?

Sure. So our total CapEx for this year, which reflects a little bit of carryforward from money we anticipated spending in '25 that's pushed into '26. The total is $450 million. The only material one that I would call out would be the Countdown hotel, which is approximately $100 million for 2026. Broken out by jurisdiction, the total CapEx in Macau is roughly $375 million, $35 million to $40 million in Manila, $35 million to $40 million in Cyprus.

And that concludes the question-and-answer session. I'd like to turn the conference back over to Jeanny Kim for any closing remarks.

Thank you, operator, and thank you all for joining. We will see you next quarter.

Thank you.

Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.