MGM Resorts substantially shrinks losses as revenue rockets 73% in Q1 2022
MGM Resorts has announced its financial results for the first quarter of 2022 alongside its $607m offer to acquire LeoVegas.
The operator’s online betting and iGaming joint venture, BetMGM, was responsible for a $92.0m operating loss in Q1, as the costs of customer acquisition and retention in burgeoning US states continue to prevent online operators from turning a profit.
Across its whole business, however, MGM Resorts increased consolidated net revenue by 73.2% year-on-year, from $1.65bn in Q1 2021 to $2.85bn in the three months ended 31 March 2022.
After $2.70bn in expenses and a total loss from unconsolidated affiliates (including BetMGM) of $46.8m, the business declared an operating income of $105.8m, compared to an operating loss of $246.7m in the prior-year period.
After other non-operating expenses and income, the business declared a net loss of $34.8m, reduced from a $335.9m net loss in Q1 2021.
MGM Resorts CEO Bill Hornbuckle: “We remain focused on achieving our vision to be the world’s premier gaming entertainment company.”
“We delivered a strong first quarter in our domestic operations driven by weekend demand and a better mix of business,” said Bill Hornbuckle, CEO and president of MGM Resorts International.
“We reached another milestone in the completion of our asset light strategy with the closing of the VICI transaction, allowing us to simplify our corporate structure and bolster our liquidity while deploying capital into growth projects with the highest shareholder return.
“We announced this morning the tender offer for 100% of the shares of LeoVegas which will allow us to expand into international online gaming with a world class management team, strong IT platform and growth prospects. We remain focused on achieving our vision to be the world’s premier gaming entertainment company.”
The proposed acquisition has already been unanimously recommended by LeoVegas shareholders, including CEO Gustaf Hagman. It would see MGM Resorts pay SEK61 per share for the Stockholm-listed operator.
Jonathan Halkyard, CFO and treasurer of MGM Resorts, added: “Our strong liquidity position, coupled with our confidence in the long-term recovery of our core business, has allowed us to continue to focus on maximising long-term shareholder value.
“To that end, we continued to repurchase our stock in the first quarter, reaching over $1bn during the first quarter of 2022 and we repaid $1bn of notes in March.
“We are disciplined in our approach to capital deployment and are focused on maintaining a strong balance sheet with adequate liquidity, while at the same time pursuing growth opportunities with the greatest return to shareholders,” he added.