MGM earnings report: Springfield is part of a strategy for MGM properties in the Northeast

July 31, 2019 | By G. Michael Dobbs
news@thereminder.com

LAS VEGAS, NV – Although the monthly earnings of MGM Springfield may have garnered some attention in the local media – as well as concerns – MGM Resorts International CEO James Murren didn’t seemed alarmed during the company’s recent earnings call to investment analysts.

The transcript of the conference call conducted on July 25 was posted by the Seeking Alpha website.

The Massachusetts Gaming Commission reported that in June the casino had a total slot and table game revenue of $19,954,469.30, down the previous month from $22,285,565.57.

In comparison, the new Encore Boston Harbor had a table game and slot revenue of $16,789,943.88 for its opening week of June 23-30. The figures do not include revenues from food, entertainment and hospitality.

From remarks made by Murren and President Bill Hornbuckle, Springfield is part of a larger strategy.

Hornbuckle noted there is an effort to create a synergy between its recently purchased Empire City Casino and Yonkers raceway in New York with Springfield and its Atlantic City, NJ casino, Borgata Hotel Casino.

Hornbuckle said, “A couple of different perspectives to look at, obviously, with our Regional strategy, it’s been a couple of years now, since we took over management of Borgata, and therefore, we now have full access to that database. Obviously, Springfield is ramping and growing, and now with the advent of Northfield Park [a casino in Northfield, OH] and Empire, we’ve added over a 1.25 million names to our database. And so what’s relevant about that is, what we do with them.

“Interestingly, Empire City had its best quarter ever, the second quarter, since right before the aqueduct opening. And so we’re encouraged by both of those businesses and we’re also encouraged by our ability to get cross-regional play and cross-traffic in and out of Las Vegas. Park MGM has helped that.

“We’ve had over a 0.25 million sign ups since that new brand has been launched. And we’ve seen our cross-play go up close to 50 percent and our room nights about the same from when it was just about a year-ago. So I think the strategy in the Northeast of note is working. Our ability to import people back and forth from Maryland, New Jersey, now from Empire into Springfield, and ultimately to Las Vegas as a price are starting to pay off.”

In answer to a question from one analyst about the company meeting expectations, Springfield included, Murren said, “So if we are behind in some place, like we’re behind in Springfield, we’re ahead in many other places and that is the value of being diversified company.”

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