A strong performance across land-based and digital have been praised following Mohegan Gaming and Entertainment’s first quarter, despite the impacts of Omicron and poor weather across certain regions.
For the three months ending March 31, 2022, revenue increased 28.7 per cent to $358.47m (2021: $278.62m), as net loss lowered to $2.44m from $15.97m one year earlier, with adjusted EBITDA closing at $86.69m, up 7.9 per cent year-on-year from $80.72m.
Revenue benefited from upticks across all core reporting segment, with gaming; food and beverage; hotel; and retail, entertainment and other reaching $261.49m (2021: $209.18m), $28.91m (2021: $13.43m), $24.86m (2021: $17.17m), and $43.2m (2021: $38.93m) respectively.
The company reports that improvements were felt due to strong performance at its owned properties as well as the addition of Mohegan Sun Las Vegas and MGE Digital.
During the previous period negative impacts were felt through COVID-19 related restrictions, including the closure of the MGE Niagara Resorts for the entire period as well as Mohegan Sun Pocono for three days; self-imposed capacity limitations at Mohegan Sun and state-mandated health protocols most of its estate.
“Our consolidated adjusted EBITDA of $86.7m reflects our strong performance and ongoing focus on profitability,” said Raymond Pineault, Chief Executive Officer of Mohegan Gaming & Entertainment.
“Although visitation was somewhat impacted by the Omicron variant and poor weekend weather at our Northeast properties early in the quarter, the consolidated adjusted EBITDA margin of 24.2 per cent was 234 basis points higher than the pre-COVID comparable fiscal 2019 quarter.”
Revenue at the company’s flagship Mohegan Sun increased 14 per cent to $358.47m (2021: $278.62m), however, net income and adjusted EBITDA dropped 15.3 per cent and 10.1 per cent to $44.24m (2021: $52.24m) and $62.92m (2021: $69.95m).
This is aligned to lower than expected volume experienced through January as well as a challenging prior year period, with MGE noting that in the prior-year period the venue “offered fewer lower-margin amenities due to COVID-related restrictions and market conditions, and had significantly lower labour, marketing and other operating expenses”.
However, driven by higher slots play as well as food and beverage consumption, revenue at Mohegan Sun Pocono increased 18.7 per cent to $62.16m (2021: $52.37m).
Net income recorded an uptick of 95.3 per cent to $8.32m (2021: $4.26m) with adjusted EBITDA closing the period at $13.22m, up 35.9 per cent to $9.73m.
MGE Niagara Resorts, limited by restrictions through the quarter, saw revenue increase 278.3 per cent $52.26m (2021: $13.81m), as net loss closed from $15.98m to $2.78m, with adjusted EBITDA closing at $7.12m (2021: -$5.52m).
In response to rising COVID-19 cases, beginning January 5, 2022, the government of Ontario mandated all casinos to close for an initial 21-day period, which was extended through to January 30, 2022.
On January 31, 2022, the MGE Niagara Resorts were permitted to reopen with a 50 per cent capacity limitation and several additional public health measures, including proof of vaccination, active screening, masks and contact tracing.
Carol Anderson, Chief Financial Officer of MGE, added: “These results demonstrate MGE’s ability to adapt to the ongoing COVID-19 pandemic, and reflect the current stabilising operating environment.
“We have reintroduced some lower margin non-gaming amenities since the prior-year period, and last year also included temporary reductions in labour, marketing and entertainment expenses as well as deferred operating expenses that were necessary to operate within the early phases of the COVID-impacted environment.”
