Pricing power and the ability to increase revenue per available room at each of the company’s Las Vegas properties propelled earnings for Mandalay Resort Group’s (MBG) fiscal quarter that ended on January 31 into record areas.
Net income for the period reached $22.8 million or $0.35 per diluted share compared to $4.2 million or $0.06 per diluted share in the fourth quarter of 2003. For the fiscal year, the company reported net income of $149.6 million, or $2.31 per share, a major jump over last year’s $115.6 million or $1.65 per share.
Highlighting the revenue per available room (REVPAR), the company noted that the room charge at Mandalay Bay was $146.46 compared to last year’s $116.31. Also, the occupancy rate during the period rose from last year’s 64.2% to the current 76.2%. Increases also occurred at the Luxor, $87.14 and 78.3 occupancy as against $74.00 and 73.2% occupancy; Excalibur, $66.75 and 85% from $55.57 and 80.5%; Circus Circus Las Vegas, $46.33 and 82.9% to $41.28 and 79.4%.
In discussing the quarter, Glen Schaeffer, company president and CFO, noted that "90 percent of the higher room rates" would go directly to the company’s bottom line. And spurring on the room rates was the dramatic increase in convention business that has resulted from the year-ago development of one of the country’s largest and most accommodative convention centers.
"The relative strength of the convention market," he said, " is evident in Mandalay Bay’s rising results." The convention area also was boosted by the opening in December, 2004, of a 1,117-suite hotel.
In other markets, the company’s MotorCity casino in Detroit, Mich., experienced a 6% rise in casinos revenues during the quarter while the property in Tunica, Miss., saw its revenues rise by 16%.
Continuing its policy of paying a dividend to shareholders, the company’s board of directors voted to continue the payments with a dividend of $0.27 a share to be paid on May 3 to shareholders of record April 16.
Encouraging increases in room occupancy at the Riviera Las Vegas, from 82.2% to 86.5%, and increased gaming revenues at its Colorado casino were reported by Riviera Holdings Corp.(RIV) for the fourth quarter of 2003.
Net revenues for the period rose to $45.4 million, a 3.9% increase while income from operations was down $2.8 million from the fourth quarter of 2002.
For the year, net revenues were $190.2 million, an increase of $1.9 million while adjusted EBITDA, earnings before interest taxes, depreciation and amortization, was $31.5 million or $2.1 million less than 2002. Net loss for the year was $14.5 million or $4.16 a share compared to the previous year’s loss of $24.7 million or $7.17 per share.
The company noted that the hold percentage was lower at the Riviera Las Vegas and there was a major expense incurred in defeating the racino referendum in Colorado.