{"id":4237,"date":"2010-08-03T14:23:56","date_gmt":"2010-08-03T22:23:56","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=4237"},"modified":"2010-08-03T14:25:46","modified_gmt":"2010-08-03T22:25:46","slug":"bad-quarters-for-mgm-boyd","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/bad-quarters-for-mgm-boyd\/","title":{"rendered":"Bad quarters for MGM, Boyd"},"content":{"rendered":"

\"\"Undershooting Wall Street<\/strong>‘s expectations for 2Q10, MGM Resorts International<\/strong> missed analyst projections and also took a big-ass writedown on CityCenter<\/strong> (above<\/em>) consigning $1.2 billion to the dustbin. Hotel occupancy was up<\/a> from 85% to 93% overall (although RevPAR slipped a wee bit) and CityCenter revenues were 39% better than the first quarter. The latter can be partly attributed to more amenities coming online or\u00a0 (more likely) room pricing that better reflected market realities and MGM’s oversupply of rooms.<\/p>\n

It could be worse<\/strong> but a source familiar with CityCenter says MGM’s been playing some serious handball with subcontractors on the project. “MGM’s not stupid,” the source said, explaining that when the real estate bubble imploded the company renegotiated contracts 20% downward, putting pressure on subcontractors’ operating margins. Now, the source says, “They’ve been grinding those people down” to pennies on the dollar, with one glazier offered $2 million for a $7.5 million job. “There’s no other work out there” for these vendors, they say, so they’re acceding to MGM’s dictates, quoth the source: “CityCenter’s been open seven months and they need the money.” The casino company also has considerably less cash on hand than rivals Las Vegas Sands<\/strong> and Wynn Resorts<\/strong>, which may have something to do with the take-or-leave-it negotiating tactics being alleged.<\/p>\n

It was a profitable quarter at Boyd Gaming<\/strong>, but one that gave additional indicators as to why CEO Keith Smith<\/strong> called off the pursuit of Station Casinos<\/strong>‘ lesser assets. Boyd’s Las Vegas<\/strong> locals revenue was down 8%, as were its Midwest and Bible Belt properties. In Vegas, Boyd is contending with an economically depleted customer base<\/a> and, generally speaking, finds its players now wary of the slightest economic hiccup<\/a>. The company’s downtown Vegas casinos, so beloved by Hawaiians, were a bulwark, down only 2%. (In terms of cash flow, the declines were much worse, well into double-digit terrain.) Now that Wall Street<\/strong> is assuming Boyd will obtain MGM’s half of Borgat<\/strong>a, year\/year comparisons no longer apply, although the resort’s $187 million net revenues comfortably dwarf any other property — or group of properties — in the Boyd chain.<\/p>\n","protected":false},"excerpt":{"rendered":"

Undershooting Wall Street‘s expectations for 2Q10, MGM Resorts International missed analyst projections and also took a big-ass writedown on CityCenter (above) consigning $1.2 billion to the dustbin. Hotel occupancy was up from 85% to 93% overall (although RevPAR slipped a … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[23,88,60,56,28,51,14,53,11,12,57,32,9,19,38],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/4237"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=4237"}],"version-history":[{"count":2,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/4237\/revisions"}],"predecessor-version":[{"id":4240,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/4237\/revisions\/4240"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=4237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=4237"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=4237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}