Jim Murren who is the Chairman for MGM Resorts International told the investors earlier in the week that the casino operator is in their strongest financial position that they have been in since the past three years and continue to grow with each day. These trends are going to continue to improve. However, this might seem odd for those of you that have been following MGM around. MGM lost around $145 million in the second quarter, and then reported their loss per share that was twice, if not triple the amount that was estimated by the analysts from Wall Street.
What did the investors say about this news?
The shares that MGM Resorts have been having had their largest increase in more than nine months alone. Murren also stated during an interview that the company’s “over arching mission” since 2009 was to be able to rebuild a balance sheet that was taken over and knocked down by the recession and construction of the CityCenter. He also went on to state that MGM Resorts, which at the time had a cash balance of $1.7 billion during the end of June, on top of their long term debt of over $13 billion was a “favorable place” in the company’s whole history.
"We were clear with investors in the teeth of the recession that we would use all means available to use to deliver on that promise," Murren said. The effort included cost-cutting and debt restructuring.they are also expecting to refinance their debt at “progressively lower rates” than before, allowing them to pay it off slower but to cover it at the same time.
This new and improved balance sheet, Murren has said, put MGM Resorts in a position to capitalize on expansion opportunities that are constantly emerging throughout the gaming markets. They continue to explore other casino opportunities in Toronto and New York City.
They are keeping their casino and hotels up in Massachusetts and are waiting to see if the legislation passes their grant to build a new casino and hotel in Maryland and Washington D.C. They continue to improve their already owned properties as well, such as the one in Las Vegas by adding their new features.
"We have a commanding position in Las Vegas," Murren said. "We're in the driver's seat because there are not going to be any major hotel products built here for many years; and with the economy improving, we can take advantage of the market conditions." The MGM Resort is spending around $160 million to renovate their guest rooms and the casino of their flagship MGM Grand Las Vegas.