MGM - Earnings call transcript Q2 2021 | MGM Resorts International

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Operator

Good afternoon and welcome to the MGM Resorts International Second Quarter 2021 Earnings Conference Call.

Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President; Corey Sanders, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer; Hubert Wang, President and Chief Operating Officer of MGM China; and Cathy Park, Executive Director of Investor Relations. Participants are in a listen-only mode. After the company's remarks, there will be a question and answer session. In fairness to all participants, please limit yourself to one question and one follow-up. is conference this note being recorded. Please

would Cathy Park. I like to to over call the Please turn Now, go ahead.

Cathy Park

results these Thanks, we our being at X-K in federal under those Chad. broadcast live forward-looking will On of the the SEC. on from is Actual This this contemplated statements the to call, securities the investors.mgmresorts.com have may release press and furnished materially also statements. on Form Safe differ make provisions call we Internet laws. Harbor

information statements today's actual periodic information or these and a Additional no Except that to results undertake to cause otherwise. our we SEC. obligation concerning could as is result factors update as of differ from law, statements required filings in press new forward-looking with the in by contained release these

the discuss we'll performance. financial talking in also measures, about our call, During non-GAAP

financial reconciliation and our find the investor You which to website. are presentation, release can in on available GAAP our press measures

turn I Finally, this presentation Bill now recorded. is will it to being Hornbuckle. over

Bill Hornbuckle

Thank and today. for all you, joining thank Cathy, us you

past of few months, back and see and effort welcoming regional experiences our Vegas to gaming witness employees, been it's taking of our these Resorts the can in And tremendous and all been the back It's delivering both that the rewarding had markets. world-class guests to pace, privilege at our guests in the properties our honor Las entertainment provide. MGM to a only we've equally the experiences. remarkable gratifying Over

have Resorts, business. at the MGM amazing best people the of here We in an team

be work they I them gaming our our last and and success, be especially we thank out vision can't time and over months. to company. to enough hard important the as world's to will have like dedication their how say entertainment our the And to company so, and continue I'd premier this for guests, to carry been take to XX critically our today

the our vision. built strategic foundation, upon in our company's planet which people investing is plan our for fact, In in long-term the we've

CityCenter in Our announced responsibly strategic across shareholders. the has and sell you MGP and the pleased our have in on subsequently among In plan the in vision, on are stated real grant to advanced light. we our for cap for units MGP discussed agreement returns valuations Blackstone win to insights spent time to gaming at This unprecedented simplifying great that's And legal de-consolidating and then MGM at He's solutions been we're VICI of capital majority the operating our we're interest XXXX. Growth also consist of - Infinity finance real since domestic monetize planet, to this intensify for that our effort in growth estate of multiple opportunities this we premium every guests and Bill down from and partner to approximately Combining of our Properties. is World, estate significant excited take in date. strongest investing know, to transaction stepped excited line. MGM's have goals our business our with the And the unique billion Infinity for a drive July short excellence corporate past to the to I'd May, purchase with asset. maximizing driving to and financial all monetizing transaction owners partnership real heels in great we operations thank and cash of Grounds sell by long-term for full billion for data-driven who operating accomplishing to World's our the in to digital operational an like MGM and greater morning, order in pursuing soon. We who the flexibility, $XX.X these leaseback XX% a working with the providing Aria four VICI. $X.X we've him on a many our after days, structure very a been our years Springfield, wish time by serving MGP of allocating this in and our leaseback operations and to leveraging amount We've become the core incredibly proud - to an and underlying these have rate align to level, customer by astonishing future. this highest in of in new the Vdara Again, the followed vision. I'm as our focus get they to an our people agreement our partnership an and long from and XX goal and meaningfully us announce for priorities, very a Board long-term of us transactions us capabilities, delivering finish best at finally, on this gaming and MGM to transactions following underlying liquidity news we and and estate strategy. we allow means real been estate importantly, comprehensive transactions over teams, asset front, become best busy that our our In experiences

XX% BetMGM operator to iGaming venture, and having Having number in nationwide of MGM came BetMGM. of In impress. a remains cross-pollination and space ups sports it second quarter continue quarter, between of reached MGM BetMGM, second remain the benefits committed a and revenues customer share market XX% continues we leader the which MGM BetMGM's terms the the and came two in BetMGM the of of iGaming see clear its is to quarter, live markets. second in opportunities, quarter, XX% and players to the its In committed in betting position also in leadership share sign its such net live BetMGM. second and acquisition, joint expanded our we the new from from XX%

digital the Strategy be He now similar and additions driving Jyoti our in customer Sustainability capabilities and to complementary relationship People, spent with be recently our future. hired another as will bench fantastic customer our a I BetMGM of its Jonathan, Tilak of driven will customer led and loyalty a Technology innovation senior deep Officer. to by Officer, has our invest Tilak we've also will experience Board who We visionary, initiatives. technology experiences, team and be and as throughout decades Innovation Chief Disney several who efforts led Directors. CFO These to he strategies, is led is Mandadi, addition of leading that a recent our where growth joining services. at with the doubt centric and Tilak me. results built Chief both American company's deeper and Tilak will excuse Chopra, Express, no products, the leader, Inclusion invaluable have and leadership strategically

also increase the footprint integrated in the our will through in into Asia diversification resort Japan. We expansion opportunity Macau and

early local confident remain forward Osaka's commercial a and a New license, markets will the hopefully Orix, Empire lastly, we fall. operator study Osaka for including to we'll ultimately key regional City significance, proposal We reviewing returns. look yield to of license York. named at be designee very and And this ago, continue a submitted starts RFP clock weeks attractive our three-month as gaming on in process. couple review our of Osaka excited and a our As which fact, by opportunity, partners, which We officially of the we sole the bidder matter we expect

results, quarter demand our Before outlook. to our high as our domestic our our pent like casino a current up I driven say words our Jonathan reported to a cost and turn consumer business discipline at and it delve second quarter few and ability well over spend trends second properties our great I'd future efforts. into to business maintain yield to by on domestic as We

July am another how our team. In continued properties that fact, momentum I both XX record record well and segments all-time these all-time in that at domestic record I win we our under and enough our you of delivered as month quarters XX gross regional circumstances, properties. have slot Vegas regional all-time of entire EBITDAR tell as Further, record June. exceeded quarters into Las in pleased and proud can't with margins

and normal driven quarter going to meeting participants We Surfaces are in full citywide and have levels. domestic of level off town series by ahead. The continue the been a to Concrete lower positive. That such very due third weekends of steam World ship a the ride In of weekend return events second and customers leisure in coming Feedback June back of volumes we're with weekday, improving, kicked and to casino surpassing group Las the fourth quarter. we from anticipate our XXXX the the here said, Vegas, as being to lag and while now groups have business. ADRs

Our the help production lead expect occupancy which for we midweek normal the will year, levels, in volumes year. back now in is of close uplift the year the half to

for to now our now group fight amount full believe and drive south compression, had in XXXX. especially Stadium, MGM, calendar contract was significant second of Allegiant more great the be a convention met tickets within as the scale with programing well with selling July, strip. overwhelming at to event, will T-Mobile recovery half we the business at 'XX large that the properties how We can Stadium over XXXX Garth this foot entertainment 'XX continue with had Mars remain our end Bruno McGregor distance situated weekends hosting itself And to post of simplifying Allegiant a at traffic. demand future. mid XX,XXX events entertainment, is the commitments relaunched as at Park capture lineup and Brooks the entertainment up Considered of with In meaningful ago, that we shaping we few we pleased we and

our part of at reminder and the at access strip to and While and bring mandatory properties. using Vegas. subsequent in resources the work the mentioned our also multiple Office another specifically to our have the remains of all vaccines very number I by taken In both July, as that closely in remains the top reinstituted business and CDC about this to our significant note incentive mandates long-term situation positioning proof monitoring as effort, COVID Las Las providing have ongoing employees, great one business easy a Vegas who are pop-up proactively base impact the to to Vegas program our our business as always, get this for last vaccinated. completely ultimately feel we the is clinics, that testing get inevitably on The our the actions as and on July, month vaccinations guests here and than all have speak our us. a pandemic Governor's virus employees, partnered stronger we'll accommodate We've safely proven priority. not campaigns, conviction as rising friends we of operating and both for and masks In proven long-term well and arena, employees resilient guests of early of of three and park months clinics but guests including weight and with vaccination. tourism. cases educational the to in continue recent few our performance, viability including local and of implemented terms of COVID behind the employee full who seriously, to best before, offers by regulators At to or continue taken safety of it's of the the the Las for our business, to too T-Mobile and and in far was we this vaccinated year we in vaccination we're health any our destination facilitate is meaningful city family all ever, in the Las We've to time, among is to our top Vegas, invested and not host properties.

delivered earlier to in quarter properties date regional mentioned their EBITDAR. yet of that terms I Our best

the quarter, a we saw given the vaccinations in delivered first that easing of broader China, continue ultimately to GGR made our pleased premium restrictions demand restrictions. below and player on into choppy rate We I'm for our also believe regional pace recovery further that we a our by levels. second MGM former remains productivity and key which properties, and outperform to as will well the hinge position rollout the labor, regions, pre-pandemic on remain as and finally July sentiment, sustainable travel environment our cost the our reinvestment, over in this, Macau, marketplace. on priority mass, are will across teams. at in encouraged strength initiatives sequential improvements of We throughout of focus to Despite stability continued And lead Macau's we the the other east streamline

restrictions With saw expeditious the Guangdong felt to pickup footprint committed to gradual suite inventory. in again. And will Macau off demand outbreak We efforts we visitation increasing some over the a soon travel better volumes the expect business of contained, start speed to and easing with quickly and while to recent additional time, and end was outbreak year. second government's half our bumps border elevating our throughout growth July in had and Macau, be the the the region the a striking upscale contain for remain days we of

Cotai are in construction tower believe premier be will mass with the and well pleased suite received we MGM and clients. which product, of the finalized by We have our south final the fitting

We and a to in that our of order are service adjustments quality our achieve to high meets standards. final to opening in make soft now level product of

are hotel us We at Cotai looking turn expect I am product quarter to open our we're officially At the for discuss at tower believe in gaming along F&B ability villas. later remodeling assets meaningful to focused another confident With over this Macau in and floors both more and we have now out and time, investment this on second growth our Macau's broader that, enhancing completed in longer-term a entertainment options and over prospects space our offerings. to to properties, recovery. MGM I we the gaming Jonathan detail. build will in further, positions month, Refresh the MGM firmly our premium with our diversify well to

Jonathan Halkyard

Thanks lot, a Bill.

first results. quarter Let's discuss our second

first quarter Our our were significantly net quarter revenues sequentially billion, results. $X.X over consolidated second better

operations. quarter our driven sequentially by Our Resorts second and was to million, net EBITDAR MGM adjusted our attributable $XXX income $XXX improved to million domestic heavily again once

the Las Vegas, at Circus XXXX. excluding far end XXXX below XX% Our billion, Vegas Despite delivered revenues top we the of quarter results. below $X lower Strip in superior quarter XX% the sold were the second second net was line, EBITDA and of Las which

which our Our million excluding is quarter the X% second property EBITDAR this adjusted just Circus. a quarter. quarter $X million, negative below was impact lower had X% and XXXX Circus $XXX to EBITDA of second Hold

was EBITDAR million. Strip Hold-adjusted So $XXX Vegas in Las

not an Our million Strip margins CityCenter, improved and XX.X% the which all-time generated margin. almost XXXX XX% basis include record results of of of points does this to $XXX EBITDAR at a

driven strong compares quarter. strength contributed more roughly and mentioned revenues to Bill And margin X continued customer. second the in was visitation Furthermore, revenues to by the improvement and casino that and and in We're above levels. Naturally mix particular As was above a are control quarter were customers second room with inherent combination XX% in driving convention casino operating know. entertainment, business. leverage all of of This in seeing our our slot leisure our XXXX second his limited business the XXXX. levels net in remarks, overall we demand, quarter our from cost points pre-COVID casino our of XX% we XX%

commensurate XX-plus second quarter demographic the since by was that second XXXX, the are on Our were And Circus Strip than COVID, attracting basis first levels apples-to-apples greater for older handle quarter with impacted seeing time at now we excluding of XX% our slot we the properties an being pre-pandemic. Circus. of to what

as we're margins Vegas believe echo the believe term, and occupancy of on an XX% occupancy the guests occupancy also as our at percent that XX% and second weekdays on normalizes serve very Las as was respectively. ramp margins. overall leisure pent-up quarter the I'll pleased demand ramping demand the XX% stabilize in this and July improvement more first that with by weekends offset quarter and Our spend will as weekdays longer some XX% from segment's that - close fully. XX% levels quarter we up to trajectory was in more past casino June at current sustainable business with and bit achieved weekends will with be mix comments we with staffing was and business stabilizes rebound. XX%, group Bill's pent-up lower, and XX% term, Longer order a to we I we this respectively. XX%, thoughts XX%

However, focus XXXX excellence and I on entertainment. know allow efforts that long we that well will confident have and group our profit to efficiency further term. cost continues overall topline rebound our upside also strip with dollars, and margins as above us levels I'm to achieve operational business

Now onto regional our operations.

Las the million slots revenues levels, in of below second continuing XX% well of EBITDAR we're $XXX by quarter statewide exact in with to outpacing easing $XXX higher just casino customer the base. our were driving by to property restrictions Our that X% X%, adjusted success levels second XXXX. and like to net quarter were in delivered million. Much aided be casino revenues due regional second over end of primarily and XXXX Vegas, quarter We XXXX

Our XX now which XXXX XX-plus member, and levels of attracting more a I'm of age demographic. we're age is to proud XX demographic, at the

the quarter. XXX points was all-time the over XXX of Our points regional quarter sequentially second margin over quarter an XXXX second first of record, basis XX% growing and by also basis

million great work and domestically, ranges we of how and effectiveness Our a margin that our have This put testament maximizing all continued regional our rethinking is model growth operating our to breadth we run on previously reinvestment the into the business. $XXX gives energy teams we identified. procurement our the deliver of efforts utilization marketing the savings labor which that from to will management cost from of confidence me

reintroduce entertainment, our will B second time adjust levels F a we margins and and casino quarter lower especially in and over term, destination longer as in spend from Our normalize the markets. bit as likely regions

to on well We term, we certain that of also can EBITDAR. achieve above size near in expect segments our longer margins impact certainly which Still, Las become also bottleneck a Vegas, a our favorable know impacting XXXX margins, right the regional I in has labor term. our negatively it's but similar had to operations, levels

betting Our joint This first in in second position iGaming. BetMGM has the from retention quarter. that in calendar, customer of These revenues online operations and first and a more of actives. solidified as strong driven arguably casinos. both U.S. yielded increased deposits with one especially grew associated two seasonally in sports catalysts. acquisition by venture betting low and sports operator are verticals quarter its U.S. reopening a nationwide during exogenous iGaming BetMGM and Net and million results with is state $XXX result clearly sequentially minimal further brick launches, sports No and to major number was the XX% time a quarter number and the the impressive mortar iGaming growth

million, Our part is in remain share excited BetMGM's losses amounted which of success. second fast-growing this calculation. $XX as BetMGM's of to line in and committed unconsolidated long-term to of marketplace our both adjusted about positioning reported quarter affiliates its the EBITDA remain partners a strong We

and was quarter, $XX million was million win X.XX% GGR million improved hold $X the lower XX% levels. in second having quarter. Mass in MGM improved X% property quarter. only market in VIP to the pre-pandemic Macau, mentioned second at quarter sequentially quarter-over-quarter of Hold-adjusted from Nevertheless, also adjusted X.XX% compared in Finally Bill also market EBITDAR $X first remain XXXX wide the first million, $XXX quarter second GGR but up of from levels. in with recovered China were of second EBITDAR MGM revenues sequentially. quarter, slightly China's the the its outperformed as to first depressed net XX% earlier, quarter, still

excluding expense, in compensation corporate $X.X share-based which included transaction million quarter million, second was $XX costs. Our

million. second term, recently repurchased share we near transactions. net repurchases expect costs story MGM or our related real and offerings light. a bit $XXX also X.X% IR going investments will our X.X We a IT, million expense to XX.X We efforts becoming active forward, to our our We shares third milestones in Springfield's higher as having quarterly the expect in quarter, through in run the $XXX shares are repurchases and to our asset to shares X.X the at incur we've In bringing that quarter million announced sold million corporate million we ramp Bill $XXX times incremental for recent and estate valued a digital believe for our were an Japan. multiple We cap share our simplifying about MGP rent for million attractively of purchased and underlying talked us rate. in $XXX today, additional year-to-date. our

of transaction second team of and quality with the of XX%. the CityCenter also unit XXXX or the We rent cash announced real million, multiple effectuating high management cap XX.X its and XXXX or with Quarter per today excellence premium watermark majority OP property, billion we margins VICI, multiple whereby Aria $XXX in CityCenter, Vdara of times with of an adjusted operations sale on Second its CityCenter's and from a XX% a above $X.X assets for the based of X.X of of at operations of Results on implied we and potential $XXX times cash the units. MGP the a our at estate EBITDA of approximately an the rate X.X% on quarter EBITDA generating ownership resort will receive XXX% adjusted acquiring of And demonstrate the flow $XX of finally, transacted million.

we an at approximately of company the will newly part million. X% valued stake nearly in agreement, hold $XXX combined the As

initial years EBITDA XX.X rent at MGP rate. an $XXX We master or will restated a transaction implied cap The times with rata enter into lease multiple with VICI million. amended X.X% values an and at pro

busy been quarter. a and it's productive a So

all and world's year, position the streamline close, to a approvals. vision these close into focused by company will is value company. The gaming and premier to transaction to the stronger CityCenter transactions next advance end to us structure on of likely and regulatory by our We deployable to third more the expect cash of take end and be maximize result entertainment first of half are subject cleaner, of end Springfield reporting VICI quarter, a of with shareholder our the the the on year

position and As adjusted worth certainly announcements. of billion highlighted today. MGM June reiterating our is to XXth, was and last I $X.X our quarter's On liquidity allocation approach the and China MGP aforementioned for excluding capital billion call, it $XX.X

a balance First, strong adequate we'll sheet liquidity. with maintain

we year. far Second, done thus this convincingly have we to will which shareholders, return cash

will a continue invest in year. to measuring to advantages programmatic of take growth we'll the the exercise clear potential and third, we'll repurchases disciplined We approach for our we discipline share shareholders. when where have and assessing And balance opportunities, prospective returns for

of we decision-making I'll act evaluate With will As over to time, his our uses as our priorities blueprint remarks. shareholders' a turn these closing for Bill that, back process. capital it for

Bill Hornbuckle

very with accomplished year. Jonathan. all we've We're this obviously Thanks, far thus pleased,

together There's our your vision. and recovery ultimately to open remain Our domestic in a to Macau's on be for focused, position Thank excellence, disciplined, strategic and on path conviction continued we'll operational We well we questions. us excited With focus transparent. actions the long-term about delivering think lot backdrop, improving strong future. our the about that, very with you. when

Operator

[Operator question Instructions] from first our come Joe with Please JPMorgan. will ahead. go Greff And

Joseph Greff

Japan uncertain. by about position. and there of near-term Obviously, just and is a to Bill sizable, start what you, to want out sort not you that to referred deployable that's I cash off you and as talking Jonathan, thing a have

whatever And you. achieving how discussed, at can as look is you and executive much just your Maybe M&A aspirations where Board in a level? doing of and level You've M&A general maybe internal goals you discuss you how at been priority or buybacks? M&A the little for maybe the a front about you. yet have Thank - bit burner talk

Bill Hornbuckle

I've you. Jonathan consistently. it, it us heard it That's a say Look, thank said simple question, you've Joe said

gaming world. entertainment already. the to like we We are key hold the We'd in it in position committed the think to premier becoming company

We one have obvious expressed the hinge desires say strategy I our company. refer other on and simply in doesn't digital, must

We to close share that six by our have Jonathan excited to buybacks I we've position the are nine friend. that we and mean on months grow we news BetMGM with time company's has these But shared already JV and working and continue our and a it's transactions great look. with before got productive. very the good we'll is, relationship or continue is

disciplined to about going be approach. we're so, the And

Jonathan Halkyard

Joe, dynamic operations we it's hands is a is we've here Jonathan, I grow the been valued active now, shares are market. which deck now, right is certainly the attractively why it We continue right believe would do and all environment to in are - only such on as in the that it U.S. add recover our

We expect to continue good I transactions in change position to be Springfield the and months several so. and our to continue years. liquidity over expected next in like of and our the But to we terms way with things with in liquidity position expect to the Vici with really a and current be just the evolve them that

Joseph Greff

markets the operating in expense than given a in in people labor the for the and then Strip regional is the quarter is How expenses rate Great, thank lag general, on the in pressure. the mismatch you talk Las growth was that. just different for finding wage of much challenges, there full Maybe you in exit maybe detail, for the expense both and – pressure the can XQ with going? in margins then some with Vegas the greater it

Bill Hornbuckle

I'll just this of Corey in balance Yes, off turn kick a saying, I to the hospitality think but the like whole second, it industry. look by I

some they're people We've can. incentives other important. labor to motivate but shortages, our We've chain suffering and are work. we everything to not issues, done supply things We back of done are share they critical, universally

through in see end been we've willingness hopefully believe the it September, in all managing of people's terms with of hopefully particularly but unemployment weighing Nevada increase come I in between we'll think we some the here, some legislature the and respects, effectively. negotiations

we've has and team have the our has it's it. really occupancies done effectively margins. and think ADRs helped business therefore with I think It and hampered our pushed - some yielded I midweek so up our good and job we a

So know if Corey, don't to pick I you from want there. it up

Corey Sanders

Yes, add finding weeks few the labor headway is, last that would we the a we've lot of what made in needed. I Joe over

not of It's going on to at As labor Bill some material mentioned, we be have cost. impact incentives. all had our the very

Bill Hornbuckle

to to everything What settle do things the paradigm can change now we're we not until completely trying in.

And so, to think that it in context. continue we about

Joseph Greff

Great, thank you guys.

Operator

question The Beynon Macquarie. go with Please Chad from ahead. is next

Chad Beynon

Thanks my taking for question.

now. that's share As to you given to think particularly us week and weekends on hotel the you're you XXXX on getting you help terms - about Thanks. of Can levels how in on gaming when back on or revenue you Vegas can market about right your timeline EBITDA pre-pandemic of a in get side basis? Las in believe terms the strength think back changed levels,

Bill Hornbuckle

Corey?

Corey Sanders

The Yes, asked and has I quarters, that to get Chad the we'll think there and XX% we question been think we're back in has last few accelerated. when hi.

I we exact back could first the on so be at some it on revenues. the in as or bookings XXXX a seeing were pretty second and level. levels, pretty XXXX, back solid think quarter early get in XXXX business trends convention of to positive when will We're that levels XXXX especially be comes non-gaming the when as

Bill Hornbuckle

we've had the of upticks coming X.X had Obviously, room in very have about this we're and all mid-week watching million the here, weeks take. a to really nights, but mean going give we're through cancellations, a balance closely couple we've actually of interestingly. group I year, limited or COVID

But looking had that week. to what's again, in forward. really happened no will going cancellations the and given stage even last be XXXX and are fundamentally substantive we've so And the setting long-term paramount XXXX great,

Corey's estimate spot So is I on. think

Chad Beynon

side you goals, already which at about digital the you're the share talked on then market Investor And exceeding. BetMGM thanks. Great, Day,

in over tools competition, a place. months, that the the next to you what with? you talk I Can in but see of just customers will that lot side, couple believe, currently have about – then think will months the in on retain your additional some next of place couple retention help business you I your be doing of you're

Bill Hornbuckle

you obviously on now call, Well, billion. about to with into space subjective chase it a Tom's the way and yesterday in heard going $X step they're

as And brick do, competitor omnichannel digital. across and presentation, if context we monetize to be ability So real it's loyalty the and you mortar the there'll about a of what broader a think what to and well same-store us likely they platform do most competitor. as in

We push. into loyalty are our heavily

several on marketing BetMGM, We executives exactly doing have who both appointed are focused and senior that. here at

between express a back at of earlier strong have play me regional regional just push And moving here up very BetMGM heard coming another soon. in we the and through product and Las We'll and the Vegas. have versa. vice BetMGM M-life yet launch also amount properties You interchange through

lower If The you team we working deck, on at prepared provided get product it our this CPA, think see and of which for is BetMGM goal, look speak it things at around the stick. ability football of retention, a note I enhancements. the and will of ultimate to clock will is you - some can to to here the loyalty, our those lot

Operator

go will with next Please from Santarelli question Deutsche Bank. The ahead. be Carlo

Carlo Santarelli

about revenue. a gave $XXX the in CityCenter of you you and Vegas But talk Las takes lot profile sorry excuse guys the of you - million to removal, Circus if the through as of bit you puts Strip about period Circus less margin color, did Jonathan, trying and a were talk forward. me, little going

over think over some being term XX% revenue of the compress you revenue million it kind the level about from back of Is bring or conservative kind little there over that margins that at being As operating of that in time? and medium is could rise of margin natural do should overly here margins come back? that to $XXX the bit of say incremental getting that a spend leverage of in before they long-term, again might kind kind

Jonathan Halkyard

a there posed, customers kind because simply taking you just driving of marketing we're well demand just experiencing going six question, we for through that months not is levels past we've from on business, casino spend thank dynamics and that been of the our this higher the the over certainly are Yes, One and few it's the here. Carlo, are our channels.

very mix And back that those for as compared to what to revenue We margin revenue both tremendous fully materially but time to that the in of upside, earned RevPAR to levels revenue are referred overall the high remarks for that's that that for for rates. perhaps bit, next as recovery presents profitable - us, so so, to that's And in get be the we've the well properties in back by will what us. same elevated business. or able some hotel sure. course those to of still and growth come other a But be to past expect that will they've same it at I much group and that that where been below, with in going lead occupancy, of fairly is over the they normalizes is is year our the our at XXXX was time avenues expectation time spending as over levels available our are

you of account So We're the the we're and revenue performance are it. in the but takes can hotel for there are the some of margin sources the to there and are to additions labor around our doing we as have, mix. upside put - best clearly just expected that future even impact puts in mostly

Corey Sanders

will I we few is it there. Carlo seeing EBITDA little make and our be side some flows. is increase up the there we're a add an opened our what will on additional of will that little Yes, then pieces the less put And great cash to also demand I just add and it business margin margins, some would opportunity what our pressure bit missing, entertainment - of a that There would are a but bit restaurants.

Carlo Santarelli

OP kind you those billion the units, related? Thank if of and $X.X follow-up guys helpful. That's of MGP/VICI kind small bit you could holding the tax about talk Corey. behind receive of little a it's implications Thanks, for for and And XX both cash million and transaction that. perhaps tax that something is the the but nitpicky, on then you guys, just could one kind rationale I of of

Jonathan Halkyard

is. It

those happen vast in and and in and happen company, majority billion units, - agreement gain remaining subject protection the through any is that that So VICI, reduced keeping those OP is $X.X what being $X.X will that gain will and will what with strokes, us on a billion interest of of cash, MGM's the will the cash in units broad the be triggered be - for which will in protects on the by tax be basis will amount X% assets. will will or sales MGP merge combined that deferred and the XX-year tax we redeemed the to of and against be the those have this VICI them of units

So - it's a XX-year that critical $X.X tax tax interest is and to remaining of that deferred the billion receipt to analysis.

Carlo Santarelli

for like guys. the sounds Appreciate color, That fun it negotiation a Great. very guys. probably was you

Bill Hornbuckle

Thanks, Carlo. All right.

Carlo Santarelli

Bye-bye. Thanks.

Operator

ahead. will Jefferies. David next from question with the And go Please Katz come

David Katz

Thanks for my question. taking

gains we seeing and As and and amount to reasonably to talk businesses outlook margin of investors out talked quarter. with clearly, of you of comfortable ability be companies primarily the listened meet time, us have an report cynicism Can of and that. should help about alleviate at that the this the that And everybody's about do be we their some why we're that cynicism sustainability same gains the just margin will the permanent. around we

BillHornbuckle

really not is this it's a margin Well, let sustainable, but that we think in did is that David, maybe that can where to substantial different where are going off end relevant me we we're couple I I on up. said let ways, up is what versus me jump it the a quarter of we've and kick think Corey In here. - difference

as margins, will other returns, high ultimately works on value, from be high like so Lady high in. things a high places. your it'd - show just It Gaga given the it whether kick or revenue, And Asia come into - particularly as cost play, higher-end business it

whether services again, don't just think And corporate XXXX our I buffet than or a if think going under better quarter things history I message. about how heard all there's to FTEs, we appreciably we've you be is remember we we'll enterprise, have business, us we are are or hope so, think products, say in we're message even I our amount our it's learned last look or certain massive X,XXX the for The I'd there given can't this had learnings, what we're never lot. today. a sustain, haven't in, at - do openings we gone we've the through I where months, labor that about and wasn't going mean to We're XX of been

We will never FTEs full go back to stop. XXXX

message the not our hope up where better excited I to to are, than and ultimately. been I'm much will we're historically so, going but they've from is, I think they be about end ever pretty where And sustain going we perspective, they're

David Katz

M the better meetings if up directions have investor the in question to there with and different I a update build That clear, was relatively making you loyalty Jonathan, grow can opportunities Thank little commentary and recall life you. bit could I the in some it, I program. be would asked just an follow out of quickly, about to helpful. respect a lot

Jonathan Halkyard

MGM Sure significant fantastic - right know and I appreciate XX you growing because do Resorts, this a now. in is loyalty have by is I bringing part up, members, BetMGM it with which we million a I huge mean for I opportunity program

the of sources properties, of transparent a and driving which a we of it's And of Vegas, in so where in here the portability Vegas Loyalty program Las important large of kind And some it's the and around those property M-life rewards visit Las the loyalty of Program to think I they when do. already play network upside and across - are Vegas. cross ours they then in regional that customers in our Las know members and particularly

- work a this of And program that going that for that platform has that as out be really us Tilak of build of think the Chief there's course Zanella, us effort that to XXXX. lot now. from impact right in real its in it's around I'm instance, design technology overall joined have Commercial next and really going there's on our of But us is the Officer. a confident here so I where impactful, Disney hugely led is talent has effort going just helps Steve is to by phenomenal he Walt Mandadi

Corey Sanders

And some began just that, we have a initiatives. - to just just a of points these few data

actually up for a were M-life opportunity regional up customers just quarter QX means pretty QX excited We're BetMGM from when XX% about cross there. about and XXXX. talk that so active Detroit and Our our actually we're what even it XX%, property, in to touching the we the surface was

that So we record a you publish results, actual in sign the mortar the in that and actually market would that and actually does see - to that July Detroit. results share Detroit market had we're up translate seeing in bricks which customers in

BillHornbuckle

And David, maybe after end. high the a is final four we're consistently comment there areas,

something and one there a and looking We're that's And of after somewhat brick the sure Detroit the is deal June, of moving at meaning business stores, not interesting, more very program by so, we just play a here we and things really mentioned And that one forward. and share at I'm is in loyalty. morning, Jonathan four an market market market omnichannel that with making holding customers on are XX% mentioned opportunity BetMGM the Corey XX% I Rome's will in great the in stumbled from that Obviously, in with mid-XXs, around the mean increase the I come accessible. just principally key in an and about drivers. this lead that's were can tidbit It's I'd be questions cannibalizing interesting modifying XX.X% has are high have regional end, aren't digitally retail so it don't mean iGaming gaming think we're we excited Corey in XX% it July at work at and and that the to retail up cannibalization. we're Michigan, XX.X% recognize we got we're idea iGaming and and share is BetMGM mortar

Operator

next The from Stanley. comes question Thomas Please with Morgan ahead. Allen go

Thomas Allen

active this next following and had in about from of numbers in difference last XX% last down the and of like Can from from driving two between XX quarter That's forward of had think So conversation, new presentation, year? those talk about you of look with BetMGM you and if you up kind XQ up were XX% in trend XX% XX% what's to we quarter. players M-life it MGM. Slide actually, how at going BetMGM new XQ on then players your is

BillHornbuckle

the more I so it overpowering Well, one's And the quarter way the I'm explains sorry. anything. Michigan, how - volume Tom, we've think mean, just is think I easier there's first the and how grew than one? and more - it's thankfully, and that I between the and many the first seen one, second that second that - by just

Thomas Allen

So up the second went BetMGM first drove first XX%, the to quarter that increase? XX% quarter and in what or players were your of MGM so legacy players one,

BillHornbuckle

known Well, et on we're cetera, terms to them sign a then to lot in the Michigan And and continued programing in them to our more terms of in BetMGM of incentives them. customers. host making up push to database otherwise, and get we and just available active to

Thomas Allen

year billion year, the And I now. there, in for of your your half this mean, - I next mean, revenue reiterated $X then, you first upside BetMGM, of see I you did essential XXX

BillHornbuckle

on second, football are database you've We do, going in just that a into the states programing, horizon done we've corner. upon, think you've around the pull of got we've got the with remember quarter, you've really something iGaming just coming couple got quarter, Maryland, I of better better in got got Arizona's first out, second DC, to not even the

we in iGaming talked think I some the BetMGM, things So We GGR numbers about of an we pretty increase market the just other and the feel you to full the if that states between year, hence about. continue me. will, comfortable potential - excuse

Operator

Please will with question next Kelley The from be go America. Bank ahead. Shaun of

Shaun Kelley

$X.X one for the bridges, sort range. kind expense billion a all could you on calculating of pro the little to VICI and to becoming was I'm would rent on forma up about billion myriad just flow of trying activity, different cash congratulations these following transaction of if I we're maybe as out guidance Just think $X.X all wondering things the be give in

So would XXXX? pieces for directionally, sort in ballpark first of after I about the that? should is, be right into the moving then all am cash taxes across we question how second these And enterprise, think settle

Jonathan Halkyard

Yes.

the as that's now working regarding to close be rent you'll - that's - right will are the XXXX. the $XXX expect the third close You The we're taxes, and in be then the you'll increased on so on introduce still are still that. ballpark. really end to at cash of quarter And million, something that of city which it changes center, relates right we

until a get I'd year. bit to prefer question I defer So the later that little think in we

Shaun Kelley

is behavior maybe you as sense that, a forward hotel follow-up, lot across of steady that, mix mix us OTA that now, you more of you area more state? curious important a Understandable. your casino doing channels, a change increase can is of kind an revenue could that in just the how some just are the about how block, and thinking going your Maybe different if right gaming or talked permanently what's a the about give where just you pretty in

Corey Sanders

this our definitely working Corey. Yes, that's is we're strategies of Shaun, on. that one big Sure.

business, to maximizing is as lot success We which had transient importantly, the transient are mix, mentioned business, But our shifting his the least is mix more package up. and similar to increases increase and in we're casino of in mix comments, from a is which mix, working the on seen pre-COVID mix the obviously, in the opening business. profitable this able our is we've period we've OTA our been in business very and land Jonathan that

we we're seeing opportunities comes what mix. convention on to optimistic is business additional very there maximize we're think when back, our that there So and

Operator

go Goldman And Grambling ahead. Please from next with comes the Sachs. question Stephen

Stephen Grambling

more years. the become asset anticipating that market sources light, intensity next into bring be base of of capital touched to us little other REITs the remind over your you potential capital Maybe turning the this bit, on Japan, but can what is contributions as to there? a you to you just you'd or And reduce what in couple

Jonathan Halkyard

remember simple with billion, we Japanese it XX. $XX if So call the to for Orix all XX% surface, The is billion up debt not math, it program XX-XX-XX, but, make it equity. project consortium to XX%, a think to call is $XX companies we lower little meaning on its the will a call fill both it's itself

it's 'XX, 'XX, give might to us if through check or about $X.XX that for want and system. how think 'XX, So - take you the a probably through $X over the billion billion flow to itself

partner and There it think is be in billion true something an we I but the would about commitment that qualified license to we'll be to we over commitment, 'XX but depending Osaka classified in this. are way will, be is cash Japan longer actual think to longer-term best a is term, $X.X XX% the are that if Japan, to see, three a you And for - so I in short a think requirement $X making REITs there on, equity term, look, to 'XX, on again years. are to that. about and 'XX, it's and billion in probably or

Stephen Grambling

cash And then capital sticking thought you. it leverage ratio has similar from around evolve. with you about Thank allocation, maybe an process allocation then how do for right different business your or the think operations VICI, proceeds asset is the than from and light of

Jonathan Halkyard

Yes. Stephen. Thank you the for question,

prepared that begun remarks, - the aggressive order so in of I probably first nine transaction is first the said the actual company to expected know shares. think in for our capital begin we You already the levels, that are shares plans cash actually and will our these - so to months valued, be come so. that those the XXXX, They've for but of the at like allocation half of in really at the of soon. or And attractively - we'll business purchasers won't close these

to opportunities entertainment vision the globally. to we'll a premier company Beyond that, look for inorganic as further - opportunities company's gaming really

is because leases structure the that certainly business - of is senior debt times, payments that - In represent think we structure capital leverage, leverage five adjusted impacts and the lease reasonable financial traditional from will targets, our and to that about to geographic certainly company's the thinking do terms the lease business changing of our to leverage four a the leverage have we on our diversification. for level of

going the thinking forward way lease-adjusted we'll be a on that's about so basis. And it

Operator

with question CBRE. is next ahead. from The DeCree go Please John

John DeCree

Thank you guys see coming near are Not - U.S. for any they something kind comments Bill, in New or opportunities thoughts still about potential might unfold those taking lot. in is all or my any to I talked you that of Jonathan interest build questions. future. gets sure for on to fruition you Casino, might longer-dated in or if or York think there's prospective markets that term to that, the medium some one Maybe that the opportunities, of have a

BillHornbuckle

and at probably a but another ultimately to it, what keen excited was Georgia closed. kind we given the to I referendum, invested does. believe location casino casino we disappointing, to that, we gets in was We that watch Texas be. York, have before through it weren't but there require there. reality taking We'll made when is - by with to know We're tell XXXX, of those it up, and the there Look, obviously interest, legislature. and both of New are in remain interest looking but run and no that were going I scale, there be time decision able time how hard partner take we're is, get It at They it's a Texas a long-term again over to real deals. still not

going not that's happen to so And overnight.

that'll in context the push but try think of to a we're Ohio domestically again, development. there's down so, real immediate in going for so And the terms casino, to nothing be horizon I of time

Japan to way just think is for had. the the near term about only the I development think discussion we

John DeCree

you then should that subjects coming ownership, And that now could bit operational a advantages entirely thinking do fold? an Bill. CityCenter little that have would XXX% do or Is there changing any be from differently the into we you anything with Thanks, about? perspective,

Corey Sanders

additional some gained owning on ran Convention operational Bellagio Center is there is our to finally Corey, right for excited Vdara as think other we it a but closer of do owned it, XXX% the it, think XXX% we like could pretty are a it. but that - it we how efficiencies about we've is of is John, we're we've to hands And is synergize getting be Aria. Bellagio example, there opportunities, This with

Bill Hornbuckle

that add this consolidating also excited fantastic. I'd comment I'm just about one

Corey Sanders

Hope way. by the

Bill Hornbuckle

XX% have averages been dimension. Our we citywide - which Vegas it’s a consolidated quarter, every which on business, phenomenal higher our had Las virtually would this CityCenter, EBITDAR outperforms

consolidated be results. financial having about into enthusiastic I'm our So it

Corey Sanders

And what it the gave us a XX% quarter. for margin

Bill Hornbuckle

Right, yes.

John DeCree

been a time Great, coming, congratulations that on everything else. it's long and

Bill Hornbuckle

easy not was one. That you. Thank

Operator

ahead. from Truist Securities. Please Jonas Barry go And the next will with be question

Barry Jonas

Thank you.

mix I clear any do be to in forward? well you on top goal side it's more Vegas levels. recent or higher cost revenue the going you the line of think I efficient pre-COVID But could versus structurally are would sustain guess more expect or XXXX there be gaming the think to as is trends,

Bill Hornbuckle

too regional increase customers, frankly love made next door is market the I'd long half with great interest of our with movement we've watched to know for we've can that we pushing that. have Look, been think theirs. our colleagues We mix doing,

Obviously, think we we that's business. high-end well what positioned. is historically have So best We're sustaining. done international

over Macau in we obviously I plant business. a regional get like have We have into would to all Asia. see back that offices us

you and there. millennial year, there's marketplace that demographic gotten real I we've older growth think, And more a numbers And the they've to think generally for it throughout myself past of away the like emergence the - another has if will, concerns. seen think seen acclimated changed interestingly called seen some audience haven't a folks to of this it's health for I these gaming. younger while. I We've remember stayed we have a lot

we're driving we pretty some about in technology platform things meaningful regard. talked we will that all excited earlier that in So, the about M-life think of be with

Corey Sanders

we think And a continue cost Obviously, initiatives, have will what mix pretty how it of what higher organically opportunities, always digital revenue the our to I that, help can that. discussion of some working I living, in grow maximize and would that how we're cost is seeing on and we we we're the think than say I is, now in. is locked there

group. capture do them ways we have that in we out for that As And to M-life base and them up believe mentioned, to over in customers we lift. XX% revenue and we customer think how were the if Bill there opportunity keep could their figure is properties,

Barry Jonas

thinking which there investment And is you base, it. are commentary curious how levels, about slot but given the player interesting just commentary strong then, play forward? younger on slot going is CapEx Got on a

Bill Hornbuckle

right some see capital we're there's looking with actually we've since pockets decent PODs, our floors. out, you'll We during we've think actually did right-sized to better at COVID you'll And what better increase now it and looking in opened, and ROIs We at spend and now. vision, excitement. looking floors. our we're we them also opportunities at right Yes, our we're laid we've that

Barry Jonas

so thanks Great, much.

Cathy Park

Last Chad. question please,

Operator

Robin And that question Farley will ahead. come from with go Please UBS.

Robin Farley

all near for any term. you circle that I thank sheet for wanted balance that. you've Great, seem and seem doesn't the you'd like But your about to fitting projects know it in. you're back getting, to proceeds would need talked just you because I need doesn't for any it it liquidity, like it tremendous of

kind any if is for reason just tax is I that do you of use think right, I'm opportunities. inorganic it And the a dividend So special looks there? wondering consideration heard phrase, there of, sort I a or there couldn't you

So is terms - for, looking sizable of that's pretty that in I budget a assume M&A. means potential

see can you? And kind thing where of gaps having interest be or portfolio might of to I Thanks. characterize if of to you fill the don't so, you what know kind

Jonathan Halkyard

other to dividend it Bill. can including There for It in broad bringing that is Thanks, a priority for in My recognition over this terms, tax Robin. through returning comment business, as real be some shareholders. to their then it very a can capital and in market dynamic other remains releasing no from about thoughts the environment represents deploy interesting it's in estate uses on. I capital that M&A not be returning as a really that reason think and with things few I'll about really fact a why it the shareholders shareholders our and to for to we going a and I'm sure up capital or opportunities, - inorganic development, it's that means is capital could us. turn that offer

position having And really kind it so, to but this available turn seize to over we like I'll our of those, on liquidity Bill.

Bill Hornbuckle

about we I - focus, to Yes, talked talked should remember we we've a but about about at I talked gaming discipline, look foremost. say, remind vision and want being company our

will be we're will look, there. and intersect gaming so, might there, be And where digital themselves entertainment

of We or some in terms go the reinvestments next We our in some we'll think our probably interest important things, that's I far don't and of don't other I afield, think in over back room years, know, properties. that's couple remodels our have shareholders. best too

think and disciplined as place, this focused and decade you'll think about we the I a driving see So the of idea whole omnichannel into us on or so. different very next better

Robin Farley

you since Is acquire for fair came it one question fair presence in like that just Vegas its seems or MGM that to amount property area scale sort how of sale a things large to have will doesn't any year? maybe have this mean, your there. just Maybe But presence? just Vegas that - want benefit the a there it assume given it earlier be from necessarily clarifying tremendous be you grow that synergy, up year an wouldn't how a growing of played like necessarily out I see you to this asset conclude is

Bill Hornbuckle

comment I comment we're right think going appreciate think now. going now. Robin, don't question, but right I I to - to the we're not

Robin Farley

Thank Okay you. all right.

Bill Hornbuckle

Thanks.

Operator

Ladies and session. like Bill turn back conference I our would remarks. gentlemen, to any Hornbuckle for the this concludes question-and-answer closing over to

Bill Hornbuckle

want both is tremendous got Chad. be quarter, team I this us thank little teams since so. through just Again, is Yes, deal with that And going amazing quick, We're bit specific to over. call and off this our July a coming universally an this quarter you out even the and thank pace. I'll more

we in So sustainable. put play have doable, I know is trackable, what is and

figured that. And industry, as it from so, ways things easily accessible potentially us, the not to by to an having we're out by we've chain also and for do very but issue learned does better different excited some lot our supply company, things. we and that, remain that a Labor

the and and and vigilant not going going business aggressively. bright velocity. that we We when as won't on that, that continue same. it to and have again, there's back talked this you no disciplined thank away. going to said the We're reason do get what some making I appreciate look We're those we over to date the and vaccinated. But so opportunities shine half so and to all. to the to go remain we we're attendance at extensive. pressure group looking COVID, at and days on to it liquidity forward returning of it to about, them making now headway second particular BetMGM all sure have with last patient tremendous And and to employees no and good half in I the And push the continues to this learnings is relates year aren't be and XX believe reason believe so, our as the keep of with everyone's year think we've do is we going our that about this position we're do future having

Operator

for And thank now The concluded. today's conference you, sir. attending Thank has presentation. you

now may You disconnect.

MGM Resorts International (MGM) 5 Aug 212021 Q2 Earnings call transcript