MGM China lifts third-quarter revenue 5% to HK$8.9bn in Macau

MGM China reported third-quarter revenue of about HK$8.9bn, up 5% year on year, and adjusted EBITDA of roughly HK$2.4bn, according to the company's unaudited third-quarter update published on Wednesday. The company said both figures were its highest for a July to September period. MGM China is listed in Hong Kong under stock code 2282.

MGM China captured 17.1% of Macau's gaming market, a record for the operator. MGM COTAI accounted for 10.5% of that share and MGM MACAU for 6.6%. Across the two resorts, daily gross gaming revenue increased 5%, and mass GGR including slots recorded the same 5% gain. The company also saw a 10% rise in daily visitation at its properties. Occupancy reached 94.1%, compared with 93.5% previously.

In the quarter, Macau's average daily gross gaming revenue came to MOP655 million, a 4% decline from the prior-year period. The company put the drop down to a temporary drag from the World Cup tournaments. Visitor arrivals went the opposite direction, averaging 122,139 per day for an 8% increase.

Revenue at MGM COTAI came to about HK$5.4 billion, compared with HK$5.1 billion previously, and its adjusted EBITDA was around HK$1.52 billion versus HK$1.46 billion a year ago. At MGM MACAU, revenue rose to roughly HK$3.5 billion from HK$3.4 billion, though adjusted EBITDA slipped to about HK$865 million from HK$914 million. Cash plus the undrawn revolver left total liquidity at close to HK$25.6 billion at the end of September.

Chief executive Kenneth Feng attributed the growth to premium customers. "The higher-end market segment continues to drive growth," he said, adding that guests had responded well to refurbished rooms and premium spaces. After converting suites at MGM COTAI earlier in the year, the company has started renovating around 100 suites at MGM MACAU.

During the October Golden Week holiday, the company recorded a 10% year-on-year increase in visitation at its properties. Across the city, hotel occupancy for the period reached 91.3%, even though room rates came under pressure.

MGM Resorts International, which holds the majority stake, published its results for the same quarter on Wednesday, after markets in New York had closed. Its SEC filing put MGM China segment revenue at $1.1 billion, a 5% increase, while Segment Adjusted EBITDAR fell 7% to $264 million from the $284 million recorded a year earlier. Much of that difference stems from the intercompany branding licence fee paid by MGM China to its parent, which climbed to $41 million from $19 million and is removed on consolidation.

The US filing further shows main floor table drop falling 10% to $3.68 billion. Main floor table win, by contrast, was 1% higher at $1.02 billion, with a hold rate of 27.7% against 24.7% a year earlier. Bill Hornbuckle, chief executive of MGM Resorts, pointed to the Macau unit's 5% revenue growth and its market share gains, and cited MGM Osaka as a key element of the group's development pipeline.