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US – MGM reports 36 per cent improvement in revenues in 2022 with Las Vegas up 77 per cent

By - 13 February 2023

MGM Resorts saw a 36 per cent improvement in revenues throughout 2022 with net revenues of $13.1bn with the group’s Las Vegas casinos reporting a 77 per cent increase in year-on-year revenue.

Las Vegas saw revenues of $8.4bn in the current year compared to $4.7bnin the prior year, boosted by the inclusion of The Cosmopolitan of Las Vegas, which was bought in May 2022, partially offset by the disposition of The Mirage in December 2022.

Revenues were also improved from the $9.7bn in the prior year due to the full year of Aria and Vdara results following its acquisition in September 2021,

Operating income was $1.4bn compared to $2.3bn in the prior year, due to a $2.5bn increase in noncash amortization expense of the MGM Grand Paradise gaming subconcession  and an increase of $1.1bn of rent expense related to triple-net operating leases and ground leases due primarily to The Cosmopolitan lease, the Aria lease, and VICI lease, partially offset by the $2.3bn gain on REIT transactions, net and the $1.1 billion gain on the disposition of The Mirage in the current year, and also due to the prior year results including the $1.6 billion gain on consolidation of CityCenter,

The fourth quarter generated net revenues of $3.6bn, an increase of 18 per cent compared to the prior year quarter. Additionally, results improved over the prior year quarter due to an increase in business volume and travel activity primarily at the Las Vegas Strip Resorts and Regional Operations;

Operating loss was $2m compared to operating income of $369m in the prior year quarter due primarily to a $1.2bn increase in noncash amortization expense relating to the MGM Grand Paradise gaming subconcession and an increase of $338m of rent expense recorded within general & administrative expense related to the VICI and The Cosmopolitan leases, which commenced in April 2022 and May 2022, respectively, partially offset by a $1.1bn gain on the disposition of The Mirage in the current quarter;

“We achieved our fifth consecutive quarter of record-breaking Las Vegas Strip Resorts Adjusted Property EBITDAR in the fourth quarter,” said Bill Hornbuckle, Chief Executive Officer and President of MGM Resorts. “What we accomplished in 2022 is nothing short of remarkable, and is a testament to our strategic plan, scale, brand strength, talented team, loyalty program, and the diverse geographies and channels in which we operate. We believe that there is strong momentum in our business and our 2023 outlook remains bright, driven by a robust events calendar domestically, MGM China’s rapid year-to-date return to profitability and BetMGM’s ongoing improvement in 2023.”

“We achieved exceptional results in the fourth quarter and remain optimistic in our outlook for this year. We are also focused on free cash flow and believe our company presents a compelling yield, especially when taking into account the value in our share price for excess cash, our ownership value of MGM China and BetMGM,” said Jonathan Halkyard, Chief Financial Officer and Treasurer of MGM Resorts. “Our share buyback program continues to return capital to shareholders as we have already repurchased 4m shares for $164m year-to-date, adding to the 76 million shares we repurchased in 2022 and totaling approximately $4.7bn since 2021. Beyond this, our Board of Directors authorized an additional $2bn for share buybacks.”

Las Vegas produced net revenues of $2.3bn in the current quarter compared to $1.8bn in the prior year quarter, an increase of 27 per cent. Regional casinos generated net revenues of $991m in the current quarter compared to $900m in the prior year quarter, an increase of 10 per cent due to an increase in business volume.

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