MGM China Holdings reported an improvement in 16Q4 profit and said revenue edged up, helped mainly by a higher VIP hold.
The company said revenue was $500 million, an increase of $1 million over the prior year period. Main floor table games revenue was down 2 percent. VIP table games revenue increased 7 percent due to an increase in hold percentage to 3.7 percent in the current year quarter, compared to 3.0 percent in the prior year quarter, partially offset by a decrease in turnover of 16 percent compared to the prior year quarter.
Adjusted EBITDA increased 5 percent to $138 million, compared to $131 million in the prior year quarter.
On a group-wide basis, MGM Resorts International posted 16Q4 diluted earnings per share of $0.04, which was well below the Capital IQ forecast of $0.19.
Quarterly revenues for the casino and resorts operator were $2.46 billion, which was up from $2.19 billion in the year-ago quarter, and equal to the analyst forecast.
Morningstar analyst Chelsey Tam, however, noted that the underlying gaming performance was below expectation.
"In addition to construction disruption and lower hold rate in the mass segment, we suspect the weaker performance is also due to Wynn Macau Limited moving some tables back to Wynn Macau in peninsula and new casino resorts creating more competitive pressure for MGM China," she said in a note on Friday.
However the opening of MGM Cotai later this year may help to recapture market share loss, said Tam.
Commenting on the results, Chairman and CEO Jim Murren said: "We are excited about the outlook for 2017, including the full year contributions from MGM National Harbor and Borgata, the continued favorable Las Vegas dynamics supported by our investments including T-Mobile Arena and the Park Theater, the opening of MGM Cotai in Macau, and our persistent drive for continuous improvement throughout all aspects of our company."
Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.
ASIA GAMING BRIEF
PO Box 1139, Macau SAR
Tel: +853 2871 7267
Fax: +853 2871 7264