Operator News
US – Mohegan improves by 27.8 per cent with addition of Mohegan Sun Las Vegas and MGE Digital
By Phil - 12 May 2022
Mohegan Gaming & Entertainment saw an improvement in GGR of 27.8 per cent in the first quarter with revenues hitting US$358,476m.
In response to rising COVID-19 cases in Ontario, beginning January 5, 2022, the Government of Ontario mandated all casinos to close for an initial 21-day period, which was extended through January 30, 2022. On January 31, 2022, the MGE Niagara Resorts were permitted to reopen with a 50 per cent capacity limitation and several additional public health measures including proof of vaccination, active screening, masks and contact tracing.
MGE Niagara Resorts performed well for the remainder of the quarter as COVID-19 restrictions eased with the lifting of capacity restrictions on February 17 and the elimination of vaccine passports on March 1. Adjusted EBITDA of $7.1m increased $12.6m compared with the prior-year period, reflecting the impact of the closure in the prior-year period as well as strong performance immediately upon re-opening.
Net revenues of $15.6m were $4.7m, or 23.1 per cent, unfavorable to the prior-year period. The prior year benefited from limited discretionary spending options in the Pacific Northwest. In addition, lower patron volumes due to the Omicron variant in January of the current period impacted management fees from ilani Casino Resort and Resorts Casino Hotel. Net loss of $8.3m was $11.5m unfavorable to the prior-year period primarily due to interest expense related to Inspire Korea in the current period.
“Our consolidated Adjusted EBITDA of $86.7m reflects our strong performance and ongoing focus on profitability,” said Raymond Pineault, Chief Executive Officer of the Company. “Although visitation was somewhat impacted by the Omicron variant and poor weekend weather at our Northeast properties early in the quarter, the consolidated Adjusted EBITDA margin of 24.2% was 234 basis points higher than the pre-COVID comparable fiscal 2019 quarter.”
Carol Anderson, Chief Financial Officer of the Company, also noted, “These results demonstrate MGE’s ability to adapt to the ongoing COVID-19 pandemic, and reflect the current stabilizing operating environment. We have reintroduced some lower margin non-gaming amenities since the prior-year period, and last year also included temporary reductions in labor, marketing and entertainment expenses as well as deferred operating expenses that were necessary to operate within the early phases of the COVID-impacted environment.”
The year-over-year improvements in net revenues and Adjusted EBITDA were due to strong performance at the Company’s owned properties and the addition of Mohegan Sun Las Vegas and MGE Digital, compared to the prior-year period, where volumes were negatively impacted by various COVID-19 related restrictions, including the closure of the MGE Niagara Resorts for the entire period, the closure of Mohegan Sun Pocono for three days, self-imposed capacity limitations at Mohegan Sun and state-mandated health protocols at most of the Company’s other properties.
All other reflects the operating results of Mohegan Sun Las Vegas and MGE Digital’s online casino gaming and sports wagering operations. Total Adjusted EBITDA of $1.7mwas comprised of $165,000 from Mohegan Sun Las Vegas and $1.5m from MGE Digital.
