CONF CALL
- US cash flow highest in 6 years
- Wholly-owned domestic resorts reported highest quarter since 2007
- CityCenter impacted by low hold at Aria
- MGM Macau: grew margins YoY in 2014
- Shake Shack opened in December 2014 - 2nd highest grossing (1st grossing is at Times Square)
- AEG Arena: anticipated in Spring 2016. Construction going well
- Mandalay Bay: Delano had double-digit revenue growth in January
- Will add 350k of meeting space
- Signed LOIs for new business into that new expansion area
- MGM Cotai: almost 2x the size of existing property
- Best year ever at MGM Sanya
- Recently signed agreement to build a Bellagio in Beijing
- National Harbor: remain on track to open in Fall 2016
- Springfield: groundbreak this spring. Targeting 2H 2017 opening
- Broad-based growth in room categories and casino
- LV STRIP 4Q
- Increased margins by 10bps
- Broad-based single-digit growth in hotel, casino, and F&B
- Higher convention mix drove REVPAR growth of 7%
- 2014: highest convention mix ever at slightly over 17% of room nights
- 2015: expect convention bookings to be at or slightly beat 2014 levels
- Q1 2015 REVPAR guidance: +2-3%
- CityCenter: tough hold comparison at Aria. Aria's table game hold fell 450bps YoY and lower volumes. Higher convention mix drove highest catering/banqueting quarter revenue.
- Crystals: strong performance
- $1.1 bn in available under corporate revolver. $1.1 bn excess cash at US
- MGM China: $1.5 bn revolver availablity
- CityCenter: $410m cash ($134m restricted cash); total debt: $1.5 bn
- Domestic Capex: Invested $114m in Q4; $387m FY
- Capex: $77m at National Harobr/Springfield in Q4; $138m FY
- Capex: $48m at Arena/Hospitality ventures
- 2015 capex: domestic resorts ($425m, room renovation at Mandalay Bay, expansion of convention space at Mandalay Bay, park between Monte Carlo/NYNY) development $500m (national harbor $375m, MGM China $80m, investments in JV (predominately Arena investment) $50m
- MGM China Q4 capex: spent $14m at MGM Macau, $37m at MGM Cotai
- MGM China FY 2014 capex: spent $45m at MGM Macau, $275m at MGM Cotai, bringing total investment to date of $500m
- 2015 capex: MGM China $100m, $1.1bn at MGM Cotai
- MGM China
- Q4 EBITDA Margins increased 10bps YoY
- Only concessionaire that reported growth in mass revenue
- Reallocated capacity. Half of tables are now allocated to mass floor. Mass contributed 75% of EBITDA in 2014 (60% in 2013)
- MGM Macau $100m capex: redesign traffic layout, introduced 15 retail outlets, new F&B offerings
- MGM Cotai: on schedule to open in Fall 2016.
- 80% of mgmt team are local employees. Looking to increase that %
- Las Vegas: showing solid signs of growth. Visitation up 4% in 2014. LVCVA expect 45m visitors in next few years; expect 30% international mix. No new capacity and airlift is expected to be up 3% in 1Q.
- 70% of LV revenues are non-gaming. Customers are spending more.
- 2015 off to very strong start in January. CES had strong attendance.
- Super Bowl drew 2nd largest crowd in city history
- Rocking Rio will debut in May.
Q & A
- January strong baccarat month
- LV: <5% EBITDA comes from Chinese baccarat
- MGM China: committed to annual dividend. Special dividend will be on a case-by-case basis.
- Non-luxury (core) is outperforming luxury due to easier comps. Still 50% off of 2007 peak ($300m EBITDA opportunity)
- Luxury: high-end gaming and F&B improvement opportunity
- Margins: tough comp for 4Q 2014
- 2015 Bookings: mid single digit increase YoY
- 60% of future bookings are corporate (50% a couple of years ago)
- Will achieve similar convention mix in 2015
- 1Q 2015 convention mix: 23% (similar YoY - last year had ConAgg)
- Core properties: high slot handle at Monte Carlo. High room revenue at Monte Carlo in January
- Rate drivers at Core properties: lower gas prices, higher convention mix, and higher airlift
- 2014 Cash taxes: will pay some but minimal (<$50m)
- REIT option? Will look at everything. Sees challenges from a tax perspective.
- Doing great in Detroit and Mississippi in January
- MGM China: will move product into the mass market. Junket market is soft.
- Pacman vs Mayweather: holding a date in May at MGM Grand. REVPAR will be through the roof if fight happens.
- LV: Genting still have not broke ground
- Guess no new property opens in Strip until 2018
- SouthWest talking about growing more flights into Las Vegas
- Mirage: had very low hold in 4Q 2014
- M-Life loyalty: record number of enrollments (+9% YoY); active M-Life members grew 8% YoY
- CityCenter: taking down Harmon (a floor/ a week) - 2.2 acres of prime real estate. CityCenter board to decide how to best use that property. CityCenter is underleveraged.
