US boost offsets China challenges for MGM
MGM Resorts International has reported a strong performance in the US to help absorb weakness in its China operations during the second quarter of the year.
In a trading update, the company said revenue decreased by 4.8% year-on-year to $2.27 billion, which was below analysts’ predictions of $2.33 billion.
In the three months to the end of June, MGM China’s revenue decreased 19% to $452 million, as VIP table games revenue declined by one third and main floor table games revenue dropped 3%.
However, while the company’s US resorts reported a slight fall in revenue, they recorded their most profitable quarter in eight years as adjusted earnings before interest, taxes, amortisation and depreciation (EBITDA) improved by 12% to $515 million.
Overall, MGM reported a profit of $474.4 million, up from $97.5 million, which was partly due to the sale of The Shops at Crystals, a shopping centre in Las Vegas.
"I am incredibly proud of the concerted effort of our talented executive teams and employees that produced our most profitable quarter in eight years at our domestic resorts," MGM Resorts chairman and CEO Jim Murren said.
"Our profit growth plan drove our domestic resorts adjusted property EBITDA to grow an impressive 12% and adjusted property EBITDA margins to improve by over 350 basis points, despite a record-breaking May last year.
“With a solid foundation of operational excellence and the continued strength in the Las Vegas market, in which we are the clear leader, we believe that MGM Resorts is well-positioned to further improve our financial strength to deliver sustainable value to our shareholders."
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