Stock analysts were expecting MGM Resorts International to report 1Q16 cash flow of $590 million but the lion overshot projections, bringing in the sheaves to the tune of $618 
million. JP Morgan analyst Joseph Greff credited much of the success to 8% greater room revenues on the Strip, led by — believe it or not — Circus Circus, up 17%. Detroit and Mississippi “contributed to the upside as well,” while MGM’s relatively small presence in Macao shielded the company from adverse consequences, even with VIP winnings down 41%. To put that in context, MGM derived $409 million of its cash flow from the Strip, only $114 million from Macao. “We are also encouraged by recent asset sales to reduce its balance sheet leverage,” referring to MGM’s enormous debt overhang and its selloff of non-core assets, climaxing in a $1.1 billion disposal of the Crystals mall. The company will also reinvest $425 million maintenance this year.
Wrote Greff, “while China-sourced play [in Las Vegas] is still down a lot, non-China Asian business has been improving.” MGM is already seeing the benefits of T-Mobile Arena, in the form of higher gaming revenues at New York-New York and Monte Carlo. It expects convention-related revenues to exceed last year’s record-setting 18.5% of the total business mix, with even better things to come in 2017, thanks to new convention space at Aria and the triennial ConExpo at the Las Vegas Convention Center. Mass-market business in Macao is said to be “improving,” while MGM Cotai is still set for a March 2017 opening.
Better to be MGM than Melco Crown Entertainment, which had a first quarter that Greff deemed “messy,” thanks in large part to a $18 million bad-debt writeoff at VIP-
oriented Altira. Return on investment at Studio City Macau, by contrast, beat JP Morgan’s estimate by 7%. Greff predicted a slower ramp-up for Studio City, along with dampened results for City of Dreams Macau (left) and Altira, due to the upcoming debuts of Wynn Palace and Parisian. Not even the opening of Studio City could prevent Melco from underperforming Macao’s sequential improvement in gaming revenues. This was mainly due to flat VIP play. Occupancies were high, with City of Dreams at 94% and Studio City at 96%.
As James Packer struggles to raise capital for his Crown Resorts projects, he has negotiated an agreement to sell down Crown’s position in Melco Crown, thereby raising some $800 million. He will also resign as co-chairman, while remaining on the board of directors. Crown’s position in MPEL will go from 34% to 27% and Melco’s will increase, though not quite so much.
* According to Lucky Dragon Casino (remember them?), completion funding is in place, the families of owner Andrew Fonfa and CEO William Weidner having put 
their money where their mouths are. By choosing to go all in themselves, Fonfa and Weidner have not only spared themselves any further grubbing for EB-5 financing, they’ve also assured the community of a “late 2016” opening. That news must come as sweet music to the ears of SLS Las Vegas, suffering in solitude on the north Strip. The Asian-themed casino is a gambling-first establishment, its gaming floor to be dominated by baccarat and pai gow. There’ll be a smattering of Western games like blackjack but if that’s your thing you’d probably be better served elsewhere. Lucky Dragon will also boast four Oriental restaurants, a tea garden and a spa. It seems to be promising a laid-back atmosphere, which would be quite a different experience from the sensory overload practiced elsewhere on the Strip.
* Will Mindfreak Live fare better with the critics than did its predecessor, Believe? In a sense, it doesn’t matter, as star Criss Angel has long since been laughing all the way to the bank.
