Grant Bowie, chief executive of Macau casino operator MGM China Holdings Ltd, says the company has plenty of opportunities for future growth in Macau, including the building of a second hotel tower at its recently opened MGM Cotai casino resort.
Mr Bowie was speaking on Thursday during an analyst and investor day hosted by MGM China’s parent MGM Resorts International. The event took place in Las Vegas, United States. In his presentation, he stated that the company had already built the foundation for a “new additional hotel tower of approximately 900 rooms” at the Cotai property.
The US$3.4-billion MGM Cotai (pictured), the firm’s second property in Macau, opened on February 13. The property features 1,390 rooms and suites, including 1,248 “resort rooms”, 99 suites, 16 skylofts and 27 mansion villas.
The company’s expansion plans for MGM Cotai include also the build-out of the south tower with an additional 100 suites, as well as the expansion of the existing podium to increase the number of restaurants, shops and entertainment offerings. The group did not mention in the presentation documents any expected capital expenditure or timetable for these projects.
MGM China also operates casino hotel MGM Macau, located on the Macau peninsula. The company had already announced plans to remodel the mass floor at MGM Macau, as well as to refurbish the property’s junket rooms.
In previous filings, the group had said it expected to invest approximately US$325 million on MGM Cotai throughout 2018, excluding capitalised interest; and approximately US$100 million in other capital improvements at MGM China.
On Thursday, during a question and answer session with analysts, Mr Bowie said the company needed to keep active in the Macau market. “We need to respond to the market conditions to make sure that we can meet the expectations,” said the executive.
MGM China also confirmed that it expected the opening of the first junket rooms at MGM Cotai – to be operated by the “top five operators” in the Macau market – to take place prior to October’s “Golden Week”. That is considered a peak period for the Macau casino market, connected to a weeklong break in mainland China associated with the country’s national day on October 1.
MGM China recorded total revenue of HKD4.66 billion (US$593.9 million) for the first quarter of 2018, up 26.4 percent from the prior-year period. The first quarter included 47 days of operations of MGM Cotai.
On Thursday, the parent company also announced that its board had authorised a new US$2 billion share repurchase programme.
“The latest share repurchase authorisation reflects the company’s financial strength and continued commitment to returning capital to our shareholders,” said Jim Murren, chairman and chief executive of MGM Resorts, in a prepared statement.
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”There are likely to be cancellations of some Chinese New Year casino and junket parties and events [in Macau]”
Vitaly Umansky, Eunice Lee and Kelsey Zhu
Sanford Bernstein analysts