MGM China property results contract in Q1, management optimistic on recovery

MGM China adjusted property results contracted to HK$84.3 million (US$10.8 million) in the first quarter of this year from the HK$367.2 million reported in the three months prior, but with the group’s net revenues jumping by 9 per cent quarter-to-quarter to HK$296 million, MGM’s latest financial report indicates.

The operator’s gaming revenues dropped by 3 per cent quarter-to-quarter in the first three months of this year, with the company’s market share falling to 11.1 per cent, but with the group pointing to recovery when comparing to pre-pandemic levels.

‘Our first quarter GGR recovered to approximately 40 per cent of pre-pandemic fourth quarter 2019 levels, compared to market’s recovery of 33 per cent. It is evident that our strength in premium mass is positioning us well as the market gradually turns the corner,’ the group noted.

MGM Macau recorded revenue of HK$1.3 billion and HK$170 million in adjusted EBITDA, with occupancy growing to 81 per cent, while MGM Cotai recorded HK$981 million in revenues but HK$86 million in negative adjusted EBITDA, with occupancy only at 47 per cent.

“MGM China is confident in Macau’s longer-term growth prospects and will continue to invest in strengthening our market position. Construction of the additional suites in the South Tower of MGM Cotai is underway and on track to open in the summer. We are also organizing themed property attractions to drive visitation,” MGM’s President and CFO, Hubert Wang, stated in the report.

The group’s Labour Day Golden Week bookings are also reaching 2019 levels close to full occupancy, with management optimistic about the holiday period becoming a turning corner for the industry.

As of March 31, 2021, the Group had total liquidity of approximately HK$14.3 billion, comprised of cash and cash equivalent and undrawn revolver.