Last week, following the coronavirus pandemic, Macau authorities ordered the shutdown of casinos in the Special Administrative Region. This has resulted in MGM making major losses of up to $1.5 million per day since the shutdown.
The company released its figures for the financial year 2019 on Wednesday. And according to a detailed article on this, as shared by CalvinAyre.com, MGM did not meet its targets in the final quarter of 2019 and already the virus epidemic is doing its damages.
The report showed that its revenue for Q4 was $3.2 billion, a 4% increase from the same period last year. Operating income was at $3 billion, nearly ten times more over Q4 in 2018 which was $336 million. The Las Vegas Strip, MGM’s own, reported a rise in revenue of 4% year on year while the table winnings dipped by nearly a point to 21.1%. Revenue from the slot games rose by 2% as the slot wins went unchanged. Room revenue went up by 5%.
In Macau, MGM’s gaming venue experienced a 6% increase in revenue to $727 million. This was entirely due to the mass market table games, which had a 315 rise in its wins. However, VIP turnover went down by nearly one third, causing a decline in VIP win by one fifth. For the whole of 2019, MGM revenue went up by 10% to $12.9 billion, while earnings went up by 6% to $3 billion. Profit went up four times to $2 billion.
During the press conference, it was announced that CEO Jim Murren will be stepping down way before his contract is up. The announcement came as a surprise to many including investors. The company did not offer any explanation as to why Murren is leaving. Murren hopes that his exit will not affect the company’s pursuit of the Japanese Integrated Resort License. MGM will be headed to Osaka in May to try and convince the locals on why they would be the best choice to set up a casino in the area.
MGM has two casinos in Macau, which are currently closed due to the coronavirus epidemic. The shutdown is expected to last 15 days, though it might have to be extended as a result of the alarming new infections that have been reported recently. So far, 52,526 people have been infected so far. With this in mind, MGM has withdrawn its 2020 financial targets.
MGM has been working with GVC Holdings, a UK-listed operator, to come up with a joint gambling/sports betting joint. However, concerning the project, PGM President, Bill Hornbuckle, said they do not feel appreciated enough. They feel JVC has not kept its end of the bargain and has been underperforming.
Hornbuckle said the player list had grown since June by over 126% and the gaming revenue was over $100 million last year. He went ahead to hint that the $100 million figure, may include MGM’s sports betting in Nevada.