MGM Resorts loses $883.5M in 2Q

LAS VEGAS - Casino operator MGM Resorts International said Tuesday its second-quarter loss widened as it absorbed a $1.12 billion write-down on its investment in CityCenter in Las Vegas.

The mammoth casino complex on the Las Vegas Strip cost $8.5 billion to build but has not shown an operating profit since it opened in December. This is the third time MGM Resorts has written down the value of its investment in the joint venture with Dubai World, which it touted as central to its future in Las Vegas.

MGM Resorts said the charge amounted to $1.64 per share during the three months ending June 30. The company took a separate $29 million charge, 4 cents per share, to write down the value of CityCenter's condominiums.

The Las Vegas company said it lost $883.5 million, or $2 per share, compared with a loss of $212.6 million, or 60 cents per share, last year.

Revenue rose about 3 percent to $1.54 billion.

Analysts, whose forecasts generally exclude onetime items like the write-down, expected a loss of 24 cents per share on revenue of $1.46 billion.

CityCenter took an operating loss of $128 million, hurt by impairment charges on its condominiums and lower-than-expected gambling wins on table games, which reduced earnings $24 million before taxes, depreciation and amortization.

The Aria Resort & Casino, the 4,000-room centerpiece casino-resort of CityCenter, was 80 percent full during the quarter at an average daily rate of $178 per night.

MGM Resorts said its losses in Las Vegas were partially offset by revenue from its joint venture in Macau, the Chinese gambling enclave. The MGM Macau casino-resort earned $40 million during the second quarter, compared with an operating loss of $8 million during the same quarter last year. The casino is a 50-50 partnership with Pansy Ho, the daughter of gambling magnate Stanley Ho.

In July, MGM Resorts announced the sale of more than 11 acres of land it was leasing to the Borgata Hotel Casino and Spa in Atlantic City to Vornado Realty Trust, New York, and California's Geyser Holdings for about $73 million. In the spring, MGM said it was putting its 50 percent stake of the Borgata into a trust and exiting Atlantic City as part of an agreement reached with the New Jersey Division of Gaming Enforcement. The settlement resulted from a yearlong investigation over MGM's ties to Ho, whose father reputedly has ties to Asian organized crime.

MGM Resorts said it had $13.3 billion in debt as of June 30 and $570 million of invested cash.