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China – MGM turns things around in Macau with 85 per cent increase in 2021

By - 10 February 2022

During the Year, MGM China‘s net revenue soared by 85 per cent to approximately HK$9.4bn. The Group had a turnaround to an adjusted EBITDA of approximately HK$390m, compared to a negative adjusted EBITDA of HK$1.4bn in 2020.

Despite the ongoing impact of the COVID-19 pandemic in 2021, Macau has been seeing a gradual recovery. The city recorded a 31 per cent growth in visitation to 7.7m, 80 per cent lower than in 2019 as a result of various travel restrictions and quarantine measures. Gross gaming revenue (GGR) grew 44 per cent year-on-year to MOP87bn, approximately 30 per cent of the pre-pandemic level. The Group’s daily GGR increased 81 per cent year-on-year to approximately HK$29m which was about 40 per cent of the pre-pandemic level, higher than the market recovery level.

MGM MACAU saw revenue up by 85 per cent to approximately HK$5.2bn and property EBITDA at approximately HK$564m, compared to negative EBITDA of HK$384m in 2020. Hotel occupancy rose to 79.8% per cent (2020: 35.6 per cent).

MGM COTAI saw revenue up by 84 per cent to approximately HK$4.2bn while narrowed EBITDA loss to approximately negative HK$174m from HK$988m loss in 2020. Hotel occupancy rose to 47.2 per cent (2020: 22.4 per cent).

MGM COTAI has introduced the Emerald Villa during the Year. The Villa is a tangible exemplar capturing MGM’s enduring spirit of “Originality + Innovation.” The launch of the spectacular award-winning suites enhanced our upscale suite offerings and complemented our room product portfolio to accommodate a wider breadth of guest types. The overall design of the Villa matches our branding standard.

The Emerald Villa is well-received by our customers as well as international design experts. It is honored with double accolades for its interior design, namely the Winner for the SBID International Design Awards 2021 in the Hotel Bedroom & Suites Design category, and the Platinum Winner at the 2021 MUSE Design Awards in the Interior Design (Hotels & Resorts) category. MGM is the first in Macau to have received these two recognitions that honor exceptional interior design.

With our meticulous focus on service and product coupled with our strength in the premium segment, MGM China grew its market share to 12.5 per cent for the Year (2020: 9.9 per cent) and reached an all-time record of 14 per cent during the fourth quarter of 2021.

The Group maintained a healthy financial position. As of December 31, 2021, the Group had total liquidity of approximately HK$13.2bn, comprised of cash and cash equivalent and undrawn revolver.

MGM China welcomes and supports the timely unveiling of the launch of the “Amendment to the Macao SAR Gaming Law No. 16/2001” by the Macau Government, which has been passed to the Macau Legislative Assembly, beginning the process of the new gaming legislation. The bill provides details on the key aspects of the overall administrative procedures and timetable, outlining a framework and roadmap on the upcoming milestone of the retendering process which is critical to maintaining a healthy and sustainable development for the future of the gaming industry. At MGM China, we wish to express our sincere gratitude to the Macau Government for providing us guidance and assistance with the preparation of the tender submission.

Kenneth Feng, President, Strategic & Chief Financial Officer of MGM China said: “The recent constructive developments during the process of retendering reaffirm our confidence in Macau Government’s judicious and fair approach to the process. Macau is an important part of our future and we will continue to work with the government on retendering.

“We remain cautiously optimistic towards a market recovery. We are going to see not just repeat customers, but new faces especially in the premium mass segment. We understand what our customers want and MGM China is well-positioned for the market’s eventual rebound. As a corporate citizen in Macau for 20 years, we have a high conviction in the future success of this region. We look forward to further investing and promoting the long-term development of Macau and supporting the government’s tourism and diversification goals for the region,” said Kenneth Feng.

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