DEUTSCHE BANK LEVERAGED FINANCE CONFERENCE September 28, 2016
Dan D’Arrigo EVP & Chief Financial O ffi cer MGM Resorts International
MGM RESORTS INTERNATIONAL Strong Domestic Operating Results Las Vegas Trends Maximizing Regional Market Share Executing Key Strategic Initiatives Continued Stabilization Of Macau Market Development Pipeline Nearing Completion
LAS VEGAS STRIP TRENDS Year-To-Date July 2016 ✓ Visitation +2% From Record 42.3 million visitors in 2015 ✓ McCarran Passengers +5% From Near Record in 2015 ✓ RevPAR +7% Average daily room rate +5% ✓ Strength in Meetings and Convention Business Citywide convention attendance +14% ✓ Gross gaming revenue +1%
MGM RESORTS - LAS VEGAS STRIP Year-To-Date June 30, 2016 Operating Results: Net Revenue +2% To $2.8 Billion Adjusted Property EBITDA +19% To $839 Million Margins +420 Basis Points To 30.4% Strong Convention Calendar Leader In Entertainment Opened T-Mobile Arena And The Park
T-MOBILE ARENA Opened April 2016
THE PARK THEATER Opening Late 2016
CITYCENTER Year-To-Date June 30, 2016 Operating Results 1 : Net Revenue +2% To $588 Million Adjusted EBITDA +18% To $170 Million Margins +407 Basis Points To 28.9% Completed $1.1 Billion Sale Of The Shops At Crystals Paid $1.1 Billion Dividend To Owners MGM Resorts Received $540 Million, Its 50% Share 1 Resort Operations and excludes The Shops at Crystals
U.S. REGIONALS Year-To-Date June 30, 2016 Operating Results - Adjusted Property EBITDA: MGM Grand Detroit +10% Beau Rivage +27% Gold Strike Tunica +15% Expanding East Coast Presence Acquired Remaining 50% Interest In Borgata Hotel Casino & Spa 1 1 Transaction closed August 1, 2016
PROFIT GROWTH PLAN: INCREASED TARGET TO $400 MILLION Adjusted EBITDA Impact – Improvement Over 2014 Baseline Domestic Resorts + 50% Of CityCenter 2015 Impact: 2016 Impact Goal: 2017 Impact Goal: $71 Million $200 Million $300 Million 2016 Impact Goal: 2017 Impact Goal: MGM $275 Million $400 Million Launches Profit $73 Million Growth $67 Million Plan Exceed 30% Adjusted Property $38 Million EBITDA Margins $33 Million Q2-15 Q3-15 Q4-15 Q1-16 Q2-16
MGM RESORTS - U.S. DOMESTIC ($ in millions) 30% 30% 26% 26% 26% 26% Successful Execution 24% 24% 24% 24% Of Our Profit Growth $1,690 $1,518 Plan Has Driven $1,443 Significant Margin $1,000 Improvement At Our $848 Domestic Resorts 2013 2014 2015 YTD 2Q15 YTD 2Q16 Adjusted Property EBITDA Margin Adjusted Property EBITDA Source: Company filings
MACAU MARKET DYNAMICS Year-To-Date June 2016 Total Gross Gaming Revenue -11% VIP Table Games -22% 1 Mass Table Games +1% 1 #1 Gaming Market In The World Room Supply Capacity Is Still Low Visitation Up, Driven By 8% Increase In Overnight Visitors Penetration Remains Low Infrastructure Projects 1 Based on Company earnings releases and filings
MGM CHINA Year-To-Date June 30, 2016 Operating Results: Net Revenue -4% Quarter Over Quarter To $921 Million Adjusted EBITDA +4% Quarter Over Quarter $249 Million 1 Margins Improved Both Year Over Year And Quarter Over Quarter To 27.1% 1 , Led By Premium Mass Over 80% Profitability From Mass Segment Paid $46 Million Dividend MGM Resorts Received $23 Million, Its 51% Share 1 Before licensing fee
DEVELOPMENT PIPELINE MGM National Harbor: Opening In Late 2016 MGM Cotai: Opening In 2Q 2017 Park MGM / NoMad in Las Vegas: Opening In Late 2017/2018 MGM Springfield: Opening in Late 2018
MGM NATIONAL HARBOR Opening Late 2016
MGM NATIONAL HARBOR Opening Late 2016
MGM COTAI Opening 2Q 2017
MGM COTAI MGM COTAI Opening 2Q 2017
MGM SPRINGFIELD Opening Late 2018
MGM SPRINGFIELD Opening Late 2018
RECENT STRATEGIC TRANSACTIONS MGM Growth Properties Successful $1.2 Billion Initial Public O ff ering The Shops At Crystals Completed Of $1.1 Billion Sale CityCenter Dividends Received $540 Million Dividend, MGM’ S 50% Share Borgata Hotel Casino & Spa Acquired Remaining 50% Interest, Sold Real Property To MGP MGM China Holdings Limited Increased Ownership +5% To 56%
POISE D FOR CONTINUED BALANCE SHEET SUCCESS Enhanced capital structure and Creates foundation for strong flexible balance sheet long-term growth Reduced from 7.7% to 5.7% Lower cost of debt 1 since 2011 Reduced consolidated net From 6.5x in 2011 to 4.8x leverage at 6/30/16 PF 2 1 Based on weighted average cost of Consolidated MGM Resorts’ debt 2 Pro forma for events subsequent to 6/30/16 including the Borgata transaction
POSITIONED TO GENERATE MEANINGFUL FREE CASH FLOW Organic Growth Through Operational Excellence Profit Growth Plan Dominant Position In Key Markets Nearing Completion Of Significant Development Projects Over $4 Billion Of Projects Open By 2017 Newly Open Resorts Ramping Successfully Executing On Strategic Opportunities
PATH TO INVESTMENT GRADE Moody's S&P Fitch Aaa AAA AAA Aa1 AA+ AA+ Aa2 AA AA Aa3 AA- AA- Recent Upgrades: Investment A1 A+ A+ Grade A2 A A Moody’s: Two Notch A3 A- A- Baa1 BBB+ BBB+ Upgrade On 4/26/16 To Ba3 Baa2 BBB BBB Baa3 BBB- BBB- S&P: One Notch Upgrade On 8/4/16 To BB- Ba1 BB+ BB+ Ba2 BB BB Fitch: Two Notch Upgrade Ba3 BB- BB- Current MGM Rating Non- B1 B+ B+ On 5/10/16 To BB B2 B B Investment B3 B- B- Grade Caa1 CCC+ CCC+ Caa2 CCC CCC Caa3 CCC- CCC- Ca CC CC Trough MGM Rating C C C
Q&A
SAFE HARBOR Forward-Looking Statements Statements in this presentation that are not historical facts are “forward-looking” statements and “safe harbor statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve risks and/or uncertainties, including those described in MGM Resorts International’s (“MGM Resorts”) public filings with the Securities and Exchange Commission and the amendments thereto. MGM Resorts has based forward-looking statements on management’s current expectations and assumptions and not on historical facts. Examples of these statements include, but are not limited to, MGM Resorts’ ability to generate future cash flow growth and to execute on future development and other projects, such as the Profit Growth Plan, the expected results of the Profit Growth Plan, MGM Resorts’ expectations regarding future financial results, the realization of any benefits from the MGP transactions and MGM Resorts’ ability to execute its strategic plan, improve its financial flexibility and achieve an investment grade rating. These forward-looking statements involve a number of risks and uncertainties. Among the important factors that could cause actual results to di ff er materially from those indicated in such forward-looking statements include e ff ects of economic conditions and market conditions in the markets in which MGM Resorts operates and competition with other destination travel locations throughout the United States and the world, the design, timing and costs of expansion projects, risks relating to international operations, permits, licenses, financings, approvals and other contingencies in connection with growth in new or existing jurisdictions and additional risks and uncertainties described in MGM Resorts’ Form 10-K, Form 10-Q and Form 8-K reports (including all amendments to those reports). In providing forward-looking statements, MGM Resorts is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise, except as required by law. If MGM Resorts updates one or more forward- looking statements, no inference should be drawn that it will make additional updates with respect to those other forward-looking statements. Note Regarding Presentation of Non-GAAP Financial Measures The following presentation includes certain “non-GAAP financial measures” as defined in Regulation G under the Securities Exchange Act of 1934, as amended, including Adjusted EBITDA and Adjusted Property EBITDA. MGM Resorts’ Adjusted EBITDA and Adjusted Property EBITDA measures have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of MGM Resorts’ results as reported under GAAP . Other companies in MGM Resorts’ industry may calculate these measures di ff erently than MGM Resorts does, limiting their usefulness as comparative measures. Schedules that reconcile the non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with Generally Accepted Accounting Principles in the United States are included in MGM Resorts’ earnings releases that have been furnished with the SEC and are available on MGM Resorts’ website at www.mgmresorts.com.
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