MGM Resorts’ third-quarter income decreased due to the pandemic’s effects.

The Macau gaming operator MGM Resorts disclosed its third-quarter 2022 financial results, revealing revenue of $241.8 million (£210.6 million/€244.6 million), reflecting a 45.8% year-over-year decline. This downturn can be attributed to the ongoing impact of the COVID-19 pandemic, which presented significant hurdles for the company.

MGM’s revenue continued to decline in the third quarter, impacted by the pandemic.
MGM’s Chairman and CEO, Pansy Ho, acknowledged the challenging performance but highlighted some positive developments, including an uptick in visitor numbers later in the quarter.

Ho stated: “In July, the Macau government implemented pandemic prevention measures, leading to the closure of our casinos for 12 days.”

“Following the reopening, the operating environment remained difficult due to persistent travel restrictions. However, we are encouraged by Macau’s recent reopening to international visitors from designated nations and the rise in visitor numbers during the Golden Week in October.”

Ho also addressed the ongoing public tender license process, where the Macau region will grant operating licenses to six operators. MGM is among seven applicants, indicating that one will be excluded.

She continued: “We submitted our application for the new gaming concession on September 14, 2022, which is a smooth and transparent process.”

We wholeheartedly endorse the Macau government’s initiatives to elevate Macau into Asia’s foremost international tourism hub.

Our proposed suggestions once again highlight our dedication to Macau, and we anticipate playing a pivotal role in collaborating with the Macau government to achieve its vision.

The majority of operating income originated from casinos, reaching $181.9 million. However, this was less than half of the previous year’s casino income of $373.1 million. Room income was $25.9 million, down 22.2%, while food and beverage income also decreased from $20.5 million to $17.9 million. Other income stemmed from entertainment, retail, and other ventures, totaling $15.9 million.

MGM’s City of Dreams integrated resort in Macau contributed $66.4 million to total income in the quarter, while the City of Dreams Manila resort contributed $102.6 million. Its Mocha Clubs (a chain of smaller gambling establishments) generated $18.8 million in revenue, and the business received $2.4 million from Altira Macau. Studio City’s income was $25.6 million. Meanwhile, MGM’s entire operations in Cyprus contributed $24.8 million in revenue.

Total expenses amounted to $440.3 million. While this was a 29.9% reduction from the third quarter of 2021, the decline was insufficient to prevent an increase in net losses – $198.5 million, compared to $182.2 million a year earlier.

Casino operations were the primary cost driver, reaching $173.8 million. This was followed by depreciation and amortization expenses of $113.5 million, and general and administrative expenses totaling $98.8 million.

The firm experienced a financial setback of $284.5 million after factoring in interest and financing charges. This represents a 2.5% rise compared to the previous year.

The net loss after accounting for taxes amounted to $286.6 million, signifying a 6.7% increase.

Income generated during the initial nine months of the year reached $1.01 billion, marking a 33.8% decline. Expenditures totaled $1.55 billion, leading to an operating profit of $543.6 million. After considering interest, taxes, and other expenses, the net loss for the period was $803.1 million.

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