In a remarkable turnaround, MGM China, a prominent concessionaire in Macau’s bustling gaming industry, has marked its best year yet in 2023. Bolstered by the removal of COVID-19 restrictions and increased visitation, MGM China reported stellar financial results for both the fourth quarter (4Q23) and the full fiscal year (FY23). These results not only reflect the company’s robust performance but also signify a broader resurgence in Macau’s gaming sector.
Overview of Financial Performance:
MGM China’s Adjusted Property EBITDAR for 4Q23 soared to US$262 million, representing a significant turnaround from the previous year and surpassing pre-pandemic levels by a substantial margin. The surge in Adjusted Property EBITDAR was supported by a remarkable 462% year-on-year increase in net revenues, reaching US$983 million. For FY23, MGM China witnessed a remarkable recovery, with Adjusted Property EBITDA reaching US$867 million and net revenues reaching US$3.2 billion.
Factors Driving Growth:
The removal of COVID-19 related entry restrictions in Macau, coupled with increased visitation and the addition of authorized tables under the new 10-year gaming concession, fueled MGM China’s resurgence. The company’s two flagship properties, MGM Macau and MGM Cotai, experienced a surge in combined gross gaming revenues, surpassing 2019 levels by 25% in 4Q23.
Performance by Property:
In 4Q23, MGM Macau recorded total revenue of HK$3.05 billion (US$390.0 million) and Adjusted Property EBITDAR of HK$824.7 million (US$105.5 million). Meanwhile, MGM Cotai reported total revenue of HK$4.62 billion (US$590.8 million) and Adjusted Property EBITDAR of HK$1.37 billion (US$175.2 million). These figures underscore the robust performance of both properties and their contribution to MGM China’s overall success.
Broader Implications:
MGM China’s record-breaking performance in 2023 not only highlights the company’s resilience but also signals a broader resurgence in Macau’s gaming sector. The positive momentum bodes well for the region’s economic recovery and underscores its status as a global gaming hub.
Impact on MGM Resorts International:
The stellar performance of MGM China contributed significantly to the overall success of its parent company, MGM Resorts International. Consolidated revenues for MGM Resorts surged to US$4.4 billion in Q4, with net income attributable to MGM Resorts reaching US$313 million. The strong financial results underscore MGM Resorts’ position as a leader in the global hospitality and entertainment industry.
CEO’s Perspective:
Bill Hornbuckle, CEO and President of MGM Resorts International, expressed optimism about the company’s prospects in 2024. He emphasized the record-setting achievements of both MGM China and the Las Vegas Strip Resorts. Hornbuckle highlighted the premium positioning and offerings in Las Vegas, which enable the company to capitalize on major events and drive incremental profits.
Future Outlook:
As MGM Resorts embarks on a new year, it is poised to capitalize on strategic initiatives, including the launch of its Marriott relationship and efforts to increase convention room nights and international mix. With a strong foundation built on record-breaking performance in 2023, MGM Resorts looks ahead to a promising future marked by growth and innovation.
The remarkable performance of MGM China in 2023, coupled with the broader resurgence in Macau’s gaming sector, underscores the region’s resilience and potential for growth. As one of the leading players in Macau’s vibrant gaming industry, MGM China’s success reflects its commitment to excellence and innovation. With promising opportunities on the horizon, MGM Resorts International is well-positioned to build on its achievements and drive continued success in the years to come.