MGM Resorts Achieves Record Results in Q4 and Full Year 2023
MGM Resorts International, a company listed on the New York Stock Exchange under the symbol MGM, reported its financial results for the fourth quarter and the entire year of 2023. The report includes significant financial achievements for both its Las Vegas Strip Resorts and MGM China operations. The company also mentioned that it had repurchased $2.3 bn of its shares in 2023, with $629 million repurchased in the last quarter alone. Additionally, MGM Resorts expanded its senior secured credit facility to $2.3 bn to increase its available cash.
The consolidated net revenue for MGM Resorts was US$4.4 bn(£3.5 bn/€4.1 bn), showing a 22% increase from the previous year. This increase was mainly due to higher revenue from MGM China, which benefited from the lifting of COVID-19 related travel restrictions in Macau. However, there was a decrease in casino revenues from their Regional Operations and the sale of The Mirage and Gold Strike Tunica properties.
The operating income for the company was $419 million, a significant improvement from a $2 million operating loss reported in the same quarter of the previous year. This improvement was primarily due to the increase in net revenues and a decrease in amortization expense related to the MGM Grand Paradise gaming subconcession. However, this was slightly offset by a $1.1 bn gain from the sale of The Mirage in the previous year.
Net income attributable to MGM Resorts was $313 million, up from $284 million in the prior year. The increase in net income was mainly affected by the factors that influenced operating income.
In the Las Vegas Strip Resorts segment, net revenues increased by 3% to $2.4 bn, mainly because of higher Average Daily Rate (ADR) and casino revenues. This was slightly offset by the disposition of The Mirage. The Adjusted Property EBITDAR for the Las Vegas Strip Resorts was $864 million, a slight decrease from the previous year, with a margin decrease primarily due to an increase in payroll-related expenses despite the increase in net revenues.
In the Regional Operations segment, net revenues decreased by 12% to $873 million. This decrease was primarily due to reduced casino revenues, affected by a union strike at MGM Grand Detroit and lower high-end table volume at MGM National Harbor, as well as the sale of Gold Strike Tunica. The Adjusted Property EBITDAR for Regional Operations was $233 million, showing a significant decrease from the previous year, with a margin decrease mainly because of the reduction in net revenues.
This financial summary provides a straightforward look at MGM Resorts’ financial performance, highlighting its revenue growth in specific areas and challenges in others.
“Our Las Vegas Strip Resorts and MGM China set new all-time records for full year and fourth quarter Adjusted Property EBITDAR,” said Bill Hornbuckle, Chief Executive Officer and President of MGM Resorts. “Our premium positioning and offerings in Las Vegas enable us to capture incremental profit during major events such as the inaugural Formula 1 race and our first Super Bowl. 2024 is off to a winning start with the launch of our Marriott relationship as well as opportunities to increase our convention room nights and international mix.”
“Yesterday, we closed on an amendment and extension to our senior secured credit facility, providing us with $610 million in additional capacity and extending the maturity by over two years to 2029,” said Jonathan Halkyard, Chief Financial Officer and Treasurer of MGM Resorts. “We continue to see great value in our shares and are returning capital to shareholders by repurchasing our shares. We have already bought back approximately 6 million shares for an estimated $249 million year-to-date, adding to the approximate 54 million shares that we repurchased in 2023, totalling $7.1 bn of repurchases since 2021.”
