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MGM Resorts International
suffered heavy pandemic-related losses in the fourth quarter and 2020 due to the company’s significant presence in the Las Vegas strip.
With its heavy reliance on group travel, conventions and air travel, the Strip has not been friendly to casino operators during the pandemic. Capacity restrictions due to Covid have also weighed on casino operations.
While
MGM Resorts
Regional casino operations and the online betting platform, BetMGM, helped lessen the damage; 2020 was a difficult year for the company.
MGM Resorts (marker: MGM), whose properties are firm 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. previous year. Tightly, it lost 90 cents per share, against a profit of 8 cents per share in the fourth quarter of 2019.
Revenue fell to just under $ 1.5 billion, below the nearly $ 3.2 billion in the corresponding period in 2019, although it improved from $ 1.1 billion in the third quarter.
Throughout 2020, the company reported a loss of $ 2.02 per share, compared to a profit of $ 3.88 the previous year. Tightly, it lost $ 3.94 per share in 2020, compared to a profit of 77 cents in 2019. Year-on-year revenue fell sharply to $ 5.2 million in 2020, from 12.9 billion from the previous year.
“We remain diligent in navigating the short-term operating environment, aggressively managing our operating model and our cost structure,” CEO Bill J. Hornbuckle told analysts during a profit call Wednesday after the market closed. . “I am optimistic about the long-term recovery of all our markets and I believe MGM is well positioned to gain participation.”
MGM shares were around $ 36 in outpatient operations, down about 1%.
According to the company’s 2020 annual report, approximately 80% of its approximately 45,000 rooms and suites were in strip facilities.
Net income for the fourth quarter of this segment fell 66% to $ 480 million, roughly flat from the third quarter, “due to the pandemic and related operating restrictions, as well as hotel closures in the week of 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% during October,” Hornbuckle said, adding that October was the company’s strongest month since the start of the pandemic. “But public health issues decreased visits throughout the quarter.”
This has continued “at least until now until February,” he said.
“We believe that these headwinds will continue in the short term. With the current Nevada collection guidelines in place and the sense of public health wherever it is, we expect business on weekdays to be a challenge during the first quarter. “
Looking to the future, Hornbuckle said that “assuming the majority of the population is willing to resume normal activity, which we saw glimpsed last summer, we believe the demand for travel and visits to Las Vegas could be solid. at the end of the year “.
For the company’s regional casino operations, fourth-quarter net income was better, down 34% year-over-year to $ 595 million, but 7% more than the third quarter. The company’s properties include MGM Grand Detroit, which closed for part of the fourth quarter.
Regional casinos depend less 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 Macau, but depends much less on the market than
Las Vegas Sands
(LVS) i
Wynn Resorts
(WYNN) They are.
MGM Resorts said its net revenue for MGM China fell 58% 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 were approximately $ 5.1 billion. Total liquidity was $ 8.8 billion.
Long-term net debt stood at about $ 12.4 billion.
Write to Lawrence C. Strauss to [email protected]