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MGM Mirage Posts Smaller Q4 Loss

The company, in which billionaire Kirk Kerkorian is a major investor, is upbeat on an industry recovery, saying its convention bookings have picked up. MGM Mirage lost $433.9 million, or 98 cents per share, for the quarter. Excluding an impairment charge to write down the value of undeveloped Atlantic City land and other items, it lost 21 cents per share.

Analysts surveyed by Thomson Reuters, whose estimates generally remove one-time items, predicted a loss of 13 cents per share.

The company kept a close eye on expenses during the quarter, lowering them to $1.96 billion from $2.68 billion a year earlier.

MGM Mirage’s stock fell 50 cents, or 4.3 percent, to $11.13 in premarket trading. The casino operator spent much of the quarter gearing up for the debut of CityCenter, a joint venture with Dubai World. The complex’s centerpiece, the Aria Resort & Casino, opened Dec. 16.

CityCenter was touted by its developers as the most expensive private development in North America and the largest private job creator in the U.S. last year, with some 
12,000 employees.

Revenue for the three months ended Dec. 31 slipped 11 percent to $1.45 billion from $1.62 billion, but still met Wall Street’s expectations. A pullback in consumer spending was still evident though, as the company based in Las Vegas reported revenue declines in casino, rooms, food and beverage, entertainment and its retail components. Gamblers have tried to conserve cash amid the economic downturn. While still venturing to casinos, they are often spending less on table games and slot machines as well as on their meals and lodging. But industry experts have started to indicate that they are seeing signs of improvement, particularly in business bookings. MGM Mirage Chairman and CEO Jim Murren said in a statement that the company’s convention booking pace gained some steam in the fourth quarter, with more than 440,000 future room nights booked.

Another potential bright spot was the easing decline in a key Las Vegas Strip revenue figure. MGM Mirage said that revenue per available room for the Las Vegas Strip fell 16 percent in the quarter, but it was a smaller drop-off than the 23 percent decline posted in the third quarter. Revenue per available room, or revpar, is a key gauge of a lodging operator’s performance.

MGM Mirage’s quarterly results come a day after rival Las Vegas Sands Corp. posted a smaller fourth-quarter loss. The Sheldon Adelson-led casino operator said its Macau casinos showed a strong recovery, while gambling in Las Vegas stabilised.

For the year, MGM Mirage reported a wider loss of $1.29 billion, or $3.41 per share, compared with a loss of $855.3 million, or $3.06 per share, in the prior year. Annual revenue slid 17 percent to $5.98 billion from
$7.21 billion.