Mohegan Gaming and Entertainment has stated that the company’s quarterly revenue decline of 7.3 per cent to $307.7m (2018: $332m) is in line with company expectations, as it points to new acquisitions and developments set to boost growth in the future.
Income from operations fell 60.4 per cent to $22.2m from $56.1m, driven by one time accelerated depreciation due to the closure of Casino of Wind, with EBITDA hitting $67.2m, a 15.9 per cent fall from $79.9m.
In its financial report Mohegan states that revenue and EBITDA decreases are due to lower gaming revenues at Mohegan Sun and Mohegan Sun Pocono, largely driven by unfavourable hold in the quarter at both properties.
However, it is noted that declines were partially offset by improved non-gaming revenue growth, including entertainment and hotel revenues, at Mohegan Sun, as well as an improved financial performance at the ilani Casino Resort.
The flagship Mohegan Sun property, located in the firm’s home market of Uncasville, Connecticut, saw revenue reach $238.9m, an 8.4 per cent dip from $260.3m, with slot and table volumes declining 8.7 per cent and 3.2 per cent respectively, in line with internal expectations.
“Volume trends across our portfolio remain inline to better than expected as overall gaming volumes at our flagship property, Mohegan Sun, remain robust despite completing our second full quarter of increased competitive pressure in the Northeast,” explained Mario Kontomerkos, president and CEO of Mohegan.
“Adjusting for unusually low table hold, overall MGE EBITDA would have been largely in line with our expectations, flat with last year’s comparable period, and well ahead of recent fiscal year 1Q19 performance.
“At the same time, non-gaming results continue to be healthy and remain a driving factor for our growth at Mohegan Sun. These revenue enhancements have been driven, in part, by the recent adoption of our $100m revenue and cost improvement program – a plan we remain committed to delivering over the next several years. Outside of the Northeast, cash flows from our managed portfolio grew strongly, up 86 per cent year over year.
“Looking ahead, in June we expect to assume operational control of two major Niagara Falls, Canada assets which will mark the first international operations for MGE, and will provide increased earnings and cash flow diversity for our stakeholders.
“Similarly, we have begun to mobilise construction at our development site in Incheon, South Korea, having completed our negotiations with our general contractor and following the receipt of all necessary construction permits and approvals.”