Revenue for Q1 at Mohegan amounted to $425.2m (£336.8m/€394.6m), up from $406.6m in 2023. Mohegan put this down to several factors including growth in its digital business and non-gaming revenue from Mohegan Inspire.
The new Mohegan Inspire resort hosted a soft opening on 30 November, with visitors able to access certain amenities. This includes three hotel towers, more than 10 restaurants and a multi-purpose arena.
More opening phases will follow, with a foreigner-exclusive casino having also opened last week, with the resort to be fully operational by the end of the first half.
However, costs associated with this opening had an impact on financial performance in Q1. Coupled with non-controlling interest adjustments at Niagara Resorts and low table hold at some properties, this resulted in a net loss for the quarter.
Lower gaming volumes hit Mohegan in US
Taking a closer look at segmental performance in the three months to 31 December 2023, gaming revenue was 1.7% higher at $285.7m. Food and beverage revenue climbed 13.8% to $43.7m, hotel revenue 6.8% to $31.6m and retail, entertainment and other 11.3% to $64.3m.
The Mohegan Sun property in Connecticut in the US remains, by some distance, the main source of revenue. For Q1, revenue reached $228.4m, down 4.6% on the previous year due to lower gaming volumes and table hold.
Elsewhere in the US, the Mohegan Pennsylvania posted $59.0m in revenue, down 1.2%. The operator said lower gaming volumes were partially offset by strong food, beverage and hotel revenue.
Revenue from Niagara Resorts edged up 0.2% to $74.2m, driven by strong food, beverage and entertainment revenue.
However, it was the digital business that was the star performer in Q1, posted a 224.1% revenue increase to $36.2m. This was put down to an accounting adjustment due to how Connecticut requires online casino and sports wagering payments be made to the state.
Mohegan noted an additional $24.3m in management, development and other revenue for Q1, up 63.6% year-on-year. A further $7.4m was reported in other revenue, including input from Mohegan Casino Las Vegas.
Net loss tops $97.0m in Q1
In terms of spending, operating costs for Q1 reached $393.3m, up 16.9%. Gaming was the main outgoing at $159.1m, while advertising, general and administrative costs reached $95.7m.
Other costs for the quarter amounted to $128.8m. These included $66.3m in net interest expenses and a $62.6m loss on fair value adjustment.
As such, Mohegan was left with a pre-tax loss of $96.8m, compared to a $2.2m profit in Q1 of 2023. The operator paid $122,000 in tax, resulting in a net loss of 97.0m, in contrast to the previous year’s $807,000 profit.
In addition, adjusted EBITDA for the quarter declined 21.9% to $79.0m.
Original article: https://igamingbusiness.com/finance/full-year-results/inspire-opening-costs-q1-loss-mohegan/
