[fm]: MGM Resorts revenue hurt by weakness in China

MGM Resorts International said its second-quarter revenue fell 4.8%, driven by continued weakness in the casino operator's China operations.

Revenue decreased to $2.27 billion from $2.39 billion a year earlier. Analysts polled by Thomson Reuters expected revenue of $2.33 billion.

Shares fell 3.3% to $23 in recent premarket trading.

In the three-month period ended in June, MGM China's revenue decreased 19% to $452 million, as VIP table games revenue declined by a third and main floor table games revenue dropped 3%.

Meanwhile, Chairman and Chief Executive Jim Murren said the company's domestic resorts had the most profitable quarter in eight years as adjusted earnings before interest, taxes, amortization and depreciation improved by 12%.

At the domestic resorts, which include properties on the Las Vegas Strip and others throughout the U.S., revenue declined 1%, but excluding divestitures increased by 1%. Revenue per available room, a key measure of performance for the lodging industry, improved by 3% at the company's Las Vegas Strip resorts as average daily room rates strengthened.

Over all, MGM Resorts reported a profit of $474.4 million, or 83 cents a share, up from $97.5 million, or 17 cents a share, a year earlier. The latest period included an asset-sale gain of 57 cents a share related to the sale of The Shops at Crystals. Analysts expected a per-share profit of 23 cents.

During March, MGM Resorts and Dubai World's Infinity World Development Corp. reached a deal to sell Crystals, a Las Vegas luxury shopping center, to mall operator Simon Property Group Inc. and Invesco Ltd. for about $1.1 billion. The 324,000-square-foot luxury shopping center is part of the giant CityCenter project which opened on the Las Vegas Strip in 2009, with hotels, condominium towers and the mall.

MGM Resorts said it expected to post a $400 million gain related to its recent deals to acquire Boyd Gaming Co.'s 50% stake in the Borgata Hotel Casino & Spa in Atlantic City and sell the real-estate assets to the real-estate investment trust MGM Resorts spun off earlier this year in an initial public offering. MGM Resorts will lease back and operate the resort.




By: Tess Stynes (The Wall Street Journal for MarketWatch).

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