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MGM Resorts International
suffered heavy pandemic losses in the fourth quarter and 2020 due to the company’s major presence on the Las Vegas Strip.
Due to its heavy reliance on group travel, conventions and air travel, Strip was not friendly with casino operators during the pandemic. The capacity restrictions due to Covid also influenced the casino’s operations.
While
MGM resorts
“The regional operations of the casinos and the online gambling platform, BetMGM, have contributed to the reduction of damages, 2020 was a difficult year for the company.
MGM Resorts (ticker: MGM), whose signatory properties in Las Vegas include Bellagio, The Mirage and Mandalay Bay, lost 92 cents a share in the fourth quarter, compared to a profit of $ 3.91 a year earlier . Adjustedly, it lost 90 cents per share, compared to a profit of 8 cents per share in the fourth quarter of 2019.
Revenue fell to just under $ 1.5 billion, down from nearly $ 3.2 billion in the corresponding period in 2019 – although it improved from about $ 1.1 billion in the third quarter.
For all of 2020, the company reported a loss of $ 2.02 per share, compared to a profit of $ 3.88 in the previous year. Adjusted, it lost $ 3.94 per share in 2020, compared to a profit of 77 cents in 2019. Year-over-year revenue fell sharply to $ 5.2 billion in 2020 from 12.9 billion dollars in the previous year.
“We remain diligent in navigating the short-term operating environment, aggressively managing our operating model and cost structure,” CEO Bill J. Hornbuckle told analysts during a profit call Wednesday after closing. market. “I am optimistic about the long-term recovery of all our markets and believe that MGM is well positioned to win shares.”
MGM shares were about $ 36 in trading after the program, down about 1%.
Based on the company’s annual report for 2020, approximately 80% of the approximately 45,000 rooms and suites were located in facilities on the Strip.
Fourth-quarter net revenue for the segment fell 66 percent to $ 480 million, roughly flat from the third quarter, “due to the pandemic and related operating restrictions, as well as the mid-week hotel closures in Mandalay.” Bay, The Mirage and Park MGM for part of the current quarter “, according to the press release announcing the company’s results.
“The fourth quarter started relatively strong here in Las Vegas, with hotel occupancy of about 46% in October,” Hornbuckle said, adding that October was the company’s strongest month since the pandemic began. “But public health problems diminished the visit during the quarter.”
It continued “at least until February,” he said.
“We believe that these winds will continue in the near future. Given the current collection guidelines in Nevada and the public health sentiment in place, we expect mid-week business to be challenged during the first quarter. ”
Looking ahead, Hornbuckle said that “assuming that most of the population is willing to resume normal activity, which we have seen in its entirety since last summer, we believe that the demand for travel and visits to Las Vegas could be more robust. late in the year ”.
For the company’s regional casino operations, fourth-quarter net income performed better, down 34% year-over-year to $ 595 million, but up 7% from the third quarter. The company’s properties include MGM Grand Detroit, which was closed for part of the fourth quarter.
Regional casinos are less dependent on conventions, meetings and entertainment than Las Vegas and other larger markets.
The company said its BetMGM and igaming sports betting platform continued to perform well and gain market share. It now lives in 12 states, including New Jersey, Tennessee, Iowa and Colorado, and the company said it expects to be in 20 states by the end of the year.
The company has operations in Macao, but is much less dependent on the market than
Las Vegas Sands
(LVS) and
Wynn Resorts
(WYNN) I am.
MGM Resorts said its net revenue for MGM China fell 58 percent in the fourth quarter to $ 305 million, but rose sharply from $ 47 million in the third quarter.
As of December 31, cash and cash equivalents totaled approximately $ 5.1 billion. Total liquidity was $ 8.8 billion.
Long-term debt was about $ 12.4 billion.
Write to Lawrence C. Strauss at [email protected]