MGM Resorts looks towards future recovery after tough 2020 trading

Image source: MGM Resorts International

MGM Resorts International has reported its Q4 and year end financial results for the period ended December 31, 2020, placing a big focus on the firm’s future recovery efforts following 12 months of challenging trading conditions.

Looking at the firm’s Q4 performance, consolidated net revenues decreased 53% year-on-year to $1.5bn, driven by lower business volume and travel activity due to the pandemic, hotel and other closures at certain properties, travel restrictions to Macau resorts, and ongoing operating restrictions.

Consolidated Q4 operating loss was $364m compared to consolidated operating income of $3bn in 2019, which included a $2.7bn gain related to the Bellagio real estate transaction. Net Q4 loss of $448m compared to net income of $2bn year-on-year.

For the full year, consolidated net revenues decreased 60% compared to the prior year to $5.2bn, alongside a net loss of $1bn in 2020, which included a $1.5bn gain related to the MGM Grand Las Vegas and Mandalay Bay real estate transaction, versus $2bn year-on-year. Consolidated adjusted EBITDAR showed a loss of $148m in 2020.

President and CEO Bill Hornbuckle, updating investors, said: “We remain confident in the long-term recovery of our business. We have strengthened our operational foundation through cost efficiencies that position us for sustainable growth, as solutions to the public health crisis accelerate and restrictions continue to ease.

“Our fourth quarter results delivered adjusted property EBITDAR improvements over the third quarter and our regional operations continued to generate margin growth.”

“We are engaged on pandemic response while staying focused on the future. This includes maintaining a strong balance sheet to seize opportunities and continuing to drive BetMGM, our US sports betting and igaming venture.

“BetMGM gained significant market share throughout 2020 while successfully launching in seven new states. We expect to be in 20 markets by the end of the year, and are very pleased with the January launches in Iowa, Michigan, and Virginia.”

“I look to the future with hope and gratitude for the strength and determination of our teams and communities, and the continued loyalty of our guests. Safety and well-being remain our highest, unwavering priorities.”

Jonathan Halkyard, CFO and Treasurer, added: “I’m thrilled to play a role in the recovery and long-term growth of one of the most iconic global gaming entertainment brands. We remain focused on executing our strategic plan to drive margin expansion, deliver profitable growth and maximize shareholder value.”

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