Saturday, May 18, 2024
HomeIntelligenceDeep DiveMohegan Gaming ends 2023 with almost $400M in EBITDA

Mohegan Gaming ends 2023 with almost $400M in EBITDA

The Mohegan Gaming & Entertainment Group reported an adjusted EBITDA of $399.9 million in 2023, the ‘second highest in its 27-year history’ the company indicated in its latest financial report.

According to Mohegan’s Chief Executive Officer, Raymond Pineault, the company has reported its strongest year ever in 2022, finishing with $403.9 million in Adjusted EBITDA.

The US-based company highlighted that the opening of its Mohegan INSPIRE on November 30 in South Korea, ‘will further enable Mohegan to achieve strong results’.

Quarterly net revenues increased $31.3 million compared with the prior-year period, primarily due to continued growth in Mohegan Digital, but partially offset by lower than expected table hold at Mohegan Sun.

In the last three months of the year, Mohegan saw $88 million in Adjusted EBITDA a decrease of $11.7 million compared with the prior-year, also due to table hold at Mohegan Sun and the non-controlling interest impact of the ‘Niagara Resorts debenture conversion and related transactions’.

Mohegan currently operates IR’s in the United States, Canada, and is in the final stages of opening its multi-billion-dollar resort in Incheon, South Korea – INSPIRE Entertainment Resort, according to the company’s new President Chen Si.

Mohegan Inspire

The group has estimated that the first stage of development of Mohegan INSPIRE will cost some $2 billion, with plans to open non-gaming offerings in October and its casino three months after that. The total project is set to cost some $5 billion.

In its earnings conference call, the Mohegan management stated to be ‘extremely excited about the opening’ and its ability to ‘drive additional growth’.

‘Mohegan INSPIRE had a soft opening on November 30 with a plated event for approximately 800 guests in the convention center for the USO Korea, which was followed 2 days later with the Melon Music Awards, which is a nationally televised music award event that attracted over 12,000 arena attendees,’ Mohegan Gaming & Entertainment, board member Thayne D. Hutchins said in the call.

The soft opening also included hotel rooms and three towers, the Splash Bay Pool, Signature Restaurants and Aurora, an indoor dining entertainment street.

Mohegan INSPIRE will have a balanced mix of gaming and non-gaming performance. The first two events have demonstrated the appeal of our non-gaming amenities and we look forward to the continued strength of the arena and ballroom along with other nongaming amenities the property will offer as it become operational,” Hutchins added.

“Additional openings of retail in the casino were expected to occur in early 2024, with additional amenities to follow in the second quarter of 2024”.

Ray Pineault, Mohegan
According to Mohegan’s CEO, Raymond Pineault, the company has reported its second strongest year ever in 2023

Meanwhile, the COO of Mohegan Gaming & Entertainment, Jody Madigan, underlined she expected the property will become cash flow positive by the end of 2024

“We have seen good foot traffic on the weekends. Our hotel occupancy is kind of where we thought it would be […] we have a couple more things coming in early Q1 of 2024 on the gaming side. And then shortly thereafter, there will be some additional non-gaming probably Q2 of 2024 that will finish the project out,’ she added.

As of September 30, 2023 Mohegan held cash and cash equivalents of $217.3 million, inclusive of letters of credit, which reduce borrowing availability, Mohegan had $182.1 million of borrowing capacity under its senior secured credit facility and line of credit.

Total debt, including capital leases and excluding unamortized debt issuance cost and discounts reached $3.27 billion in the fourth quarter, up $176.2 million from the previous quarter.

According to Mohegan, this increase was mainly due to financing activity from the development of Mohegan INSPIRE, including additional draws under the project finance facility as well as the Niagara Resorts refinancing that took place in August, which included an incremental CAD100 million ($74 million) return on capital loans.

Nelson Moura
Nelson Moura
Editor and reporter with 10 years of experience in Greater China, namely Taiwan and Macau, in printed and online media, with a focus on finance, gaming, politics, crime, business and social issues.