Floyd Mayweather’s unanimous victory over Manny Pacquiao was a huge payday for MGM Resorts International, which hosted the bout, even if fans went away disappointed that they didn’t see more action in the ring.
Fans in town for the fight spilled out to the tables at MGM Resorts’ 10 Las Vegas casinos, driving bets to a record, according to Chairman and Chief Executive Officer Jim Murren, who’s still tallying the numbers. Revenue from hotel rooms on the Las Vegas Strip rose 30 percent for the weekend, he said, enough to lift companywide room sales for the second quarter by 1 percent. Many guests stayed Sunday night.
“We haven’t seen these kinds of numbers, you’d have to go back to Mike Tyson in his heyday to get anywhere near,” Murren said in an interview. The fight was held at the MGM Grand Garden Arena, attached to the company’s namesake hotel.
The boxing bonanza was a bit of good news for MGM Resorts, which reported first-quarter sales that missed analysts’ estimates and is being pressed to put its casinos into a real-estate investment trust by a dissident shareholder. The company, the largest casino operator on the Las Vegas Strip, reported revenue fell 11 percent to $2.33 billion, according to a statement Monday. That compared with the $2.38 billion average of estimates compiled by Bloomberg.
At MGM China Holdings Ltd., facing a hit from Macau’s steep drop in gambling, revenue slumped 33 percent to $630 million. Las Vegas Sands and Wynn Resorts both reported first-quarter earnings that missed estimates last month.
MGM China, the company’s 51-percent owned subsidiary, had been a source of growth when the Macau market expanded. Murren said that while he felt confident about MGM China’s regular dividends, the company’s special dividend, declared in February in past years, will be reviewed.
MGM Resorts gets the bulk of its revenue from Las Vegas, from resorts such as Bellagio and MGM Grand, and is under pressure from Land & Buildings Investment Management LLC to put its properties into a REIT. Land & Buildings has proposed four nominees to the board at the company’s May 28 annual meeting. MGM Resorts has asked investors to not support those candidates.
Three large shareholders have come out in support of the company’s nominees. They include Los Angeles billionaire Kirk Kerkorian, who owns 18.6 percent of MGM Resorts’ shares according to Bloomberg data, and Dubai-investment firm Infinity World, with 5.3 percent, Murren said Monday. Hedge fund manager John Paulson, with 1.4 percent, told Bloomberg News last week, he supported the company’s nominees as well.
MGM Resorts fell less than 1 percent to $21.27 at the close in New York. The stock is little changed this year, while competitors Las Vegas Sands and Wynn Resorts have declined 8 percent and 21 percent, respectively.
Ticket sales for the Mayweather-Pacquiao fight at the 16,200-seat MGM Resorts arena were a record $70 million, Murren said. MGM Resorts rents its arena out to the fight promoter and pays for seats that are resold or given to customers, he said. The Las Vegas-based company also sold 46,000 tickets to watch the match on closed-circuit TV, generating $9 million.
Atlantic Aviation, a private airplane terminal at Las Vegas’ McCarran International Airport, had to divert planes to a North Las Vegas airport after parking 500 planes, Murren said. The previous record, set during a Super Bowl, was 350 aircraft.