MGM Resorts plays coy with REIT plans, says Mirage “not on the market”

Casino operator MGM Resorts International’s domestic gaming operations helped offset a serious downturn in its Macau business during Q2 2015.

MGM reported revenue of $2.39b in the three months ending June 30, down 7.5% from the same period last year. The drop was entirely the result of a 16% decline in gaming revenue, most of which occurred at MGM China. Operating income fell 1.6% to $348.5m while net income fell 11% to $97.5m.

MGM China’s revenue fell 33% to $557m while earnings dropped 37% to $132m, which sound terrible until you compare it with the truly horrific declines recently reported by Sands China and Wynn Macau. MGM Macau’s VIP tables reported revenue and turnover down 43% and 54% respectively, more than enough to offset a 0.5 point gain in VIP win to 3.2%. Things were slightly less dire at the mass market tables, where revenue fell 23%.

MGM China CEO Grant Bowie said MGM Macau had sought to address the VIP decline by shifting 49 tables from VIP to mass, with mass now representing 60% of the property’s total table allocation. Despite the recent opening of Galaxy Macau’s Phase 2, Bowie said MGM Macau had managed to increase its market share in June. Bowie also confirmed that the in-development MGM Cotai resort remained on target for a Q4 2016 opening.