MGM China revealed Thursday that it is preparing to launch major upgrade works to the premium gaming and accommodation spaces of both Macau resorts, MGM Macau and MGM Cotai, following a record-breaking quarter in the three months to 30 September 2023.
The company has also expressed confidence in continued strength in the quarters ahead, despite market concerns over the slowing growth of the mainland China economy.
In releasing its 3Q23 results this morning, MGM China said it had notched all-time third quarter records in both Adjusted Property EBITDAR and mass GGR, while October had also set an all-time monthly record in Adjusted Property EBITDAR.
Speaking on the company’s Q3 earnings call, MGM Resorts CEO and President Bill Hornbuckle outlined plans to make “opportunistic changes to our casino floor and existing room products to maximize yield, taking care of our mass and premium mass customers and driving international tourism.”
This, he explained, will include a re-modeling of the platinum gaming area at MGM Cotai, starting early next year, and a villa upgrade at MGM Macau which will also see the addition of six new villas.
It is, Hornbuckle said, “clearly evident that business is booming” in Macau.
Asked if there were any concerns about the macro-economic situation in China, MGM China’s President and Chief Operating Officer Hubert Wang pointed to a recent forecast by the Macau government which estimates Macau-wide GGR to grow to around US$27 billion in 2024.
“This is quite consistent with our belief and with market consensus as well,” Wang explained.
“I think yes, in China there is some softness in the overall macro-economic situation and GDP growth is around 4% to 5%, but I believe that Macau is not [directly linked] to the average of GDP growth of the standing pattern in China.
“We in Macau cater to about 30 million visitors a year and unique visitation is about half of that, so it’s still a very small number in the grand scheme of population in China.
“We cater to the middle class and the upper middle class and the consumption in China between high-income groups and the base mass is very different. You see continued growth in luxury goods purchase in the high-income group, while the mass you have seen a decline, so I think Macau is well positioned to cater to the group with high spending. This is what the concessionaires and the government is trying to do – to capture that group into the market.”
