Operator News
US – MGM sees 22 per cent growth due to National Harbour and Borgata
By Phil - 31 July 2017
With same store growth stalling domestically, MGM Resorts relied on the new revenue streams brought by the inclusion of results from MGM National Harbor and Borgata to boost its net revenue by 22 per cent, taking its domestic resorts revenue total to $2.1bn.
However it suffered a same store domestic decrease of one per cent primarily due to lower year over year table games hold. The headline new story was of course the opening of MGM National Harbour, which helped boost operating income at its domestic resorts to $520m, a 33 per cent increase over the prior year quarter.
Casino revenue for the second quarter of 2017 increased 41 per cent compared to the prior year quarter, due primarily to the acquisition of Borgata in August 2016 and the MGM National Harbor opening in December 2016, partially offset by a decrease in table games revenue. Casino revenues decreased five per cent on a same-store basis compared to the prior year quarter. Same-store table games revenue decreased 20 per cent primarily due to lower year over year table games hold. Same-store slot revenues increased three per cent.
MGM’s CityCenter produced operating income of $57m and Adjusted EBITDA of $105m, a 36 per cent increase in Adjusted EBITDA compared to the prior year quarter.
Jim Murren, Chairman & CEO of MGM Resorts, said:”MGM Resorts continues to drive profitability and operational efficiency, as the Company produced diluted earnings per share of $0.36 in the second quarter and our domestic resorts exhibited Adjusted Property EBITDA and margin growth on a same-store basis. CityCenter reported another quarter of exceptional results driven by Aria. Our results benefited from the addition of MGM National Harbor and Borgata, which continue to lead their respective markets. As we look to the third quarter, we face a challenging comparison at our Las Vegas Strip resorts due to favorable table games hold of 25 per cent and RevPAR growth of 10.7 per cent in the third quarter of 2016. We also continue to see higher than anticipated disruption at Monte Carlo as the property undergoes its transformation to Park MGM.”
Results at MGM China saw net revenues of $449m, representing a one per cent decrease compared to the prior year quarter. Main floor table games revenue decreased two per cent compared to the prior year quarter due to an eight per cent decrease in volume partially offset by an increase in hold percentage to 19.3 per cent in the current year quarter, from 18.2 per cent in the prior year quarter, and against 22.2 per cent hold percentage in the first quarter of 2017. VIP table games revenue increased one per cent compared to the prior year quarter.
Mr. Murren added: “In Macau, we are excited to bring world-class entertainment and diversified attractions to the marketplace with the opening of MGM Cotai in the fourth quarter. We remain squarely on our path to generate the best possible cash flow performance and return value to our shareholders. This quarter’s results clearly demonstrate that.”
