MGM Resorts Uses Q2 Earnings Call to Stake out Thailand Interest

MGM Resorts may be among the parties interested to join Thailand in the country’s pursuit of an integrated casino resort. This is the faint signal sent by company CEO and president Bill Hornbuckle who has outlined the hospitality behemoth’s interest in exploring this opportunity further.

MGM Resorts Looks into Asian Market

Thailand is currently in talks to launch what are more or less Las Vegas casino resorts in the country, which will be aimed at boosting tourism, driving more overseas visitors, and propping up the local economy.

A feasibility study has already been carried out along with potential locations for the realization of such projects, nipping some of the possible criticisms against the initiative in the bud. MGM Resorts’ hit at new development opportunities coincides with the continuously diminishing opportunities ahead for Macau to establish itself as a driver of revenue any time soon.

Commenting on the recent results and future company aspirations, Hornbuckle said that the company had clocked a $1.8 billion profit for Q2 2022. EBITDAR loss in Macau, however, amounted to $52 million. Hornbuckle did confirm that the company is now improving its capital reserves, allowing it to actively pursue new opportunities.

Mergers & acquisitions are a natural next stop for MGM Resorts, but the possibility of exploring a groundbreaking move in Thailand does exist. Hornbuckle confirmed that Japan is a market that the company would be pleased with pursuing as well, arguing that MGM Resorts could afford to put down several billion dollars in Japan if the opportunity arises. He added:

Between that and Macau we feel pretty comfortable with what’s going on there. Obviously we will watch, like everyone, what happens in Thailand – or anywhere else for that matter – but we like where we are and we’d like to be in Japan at scale.

MGM Resorts President and CEO Bill Hornbuckle

This strategic maneuvering in Asia comes at a time when the new tender rules in Macau have been made public with MGM’s local subsidiary, MGM China, working hard on securing a new license and extending its operations in the SAR for another 10 years.

Macau Poses Its Continuous Challenges

The reduced continuity of the gambling licenses which will only be up for a decade has indeed posed some new challenges, Hornbuckle admitted. With COVID-19 still around, making a good read of what investment would translate into a solid return has become more difficult. He assured, though, that MGM Resorts was prepared to dig heavily into the many moving parts that need to be understood better to come up with a good final decision.

That includes social programming, job opportunities, employment, and more. Despite those headwinds and the vagaries of the central government, though, Hornbuckle feels strongly about the future of the SAR as currently none of the six operating concessionaires are likely to give up and opt out of submitting a bid.

Hornbuckle though refrained from going deeper in detail about Thailand and said that he would prefer not to comment during the call other than mentioning that the country is an interesting destination for now.

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