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MGM Resorts CEO Jim Murren on the gaming company’s earnings and the impact of the global economic slowdown.
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A jumping today and still a little bit in after hours trading after reported better than expected revenue the company actually seeing strong results coming from China.
Huge results there in -- Jim -- chairman and CEO of MGM resorts and he joins us now.
-- -- first of all whenever the stock goes up over 7% it's a growth -- today.
You outperform your competitors.
Las Vegas Sands wins caesar's and everything else but I'm I'm just wondering if you are seeing a slower because people are reporting now.
A slowdown because of the slowing of the economy.
In in the action going -- -- resorts and in the casinos.
Well.
There's no doubt that to consumer took a step back in May we sought about middle of may -- -- continued throughout June.
And I think that's reflected a lot of folks earnings reports.
-- wherever the weather that a bit through some increase market share but.
That is actually very factual.
Good news is we're starting to see.
Some recovery there we saw -- -- some in July and continued into August.
But there's no doubt there was a pullback in consumers.
And to a lesser extent in the business traffic -- in the second quarter.
-- he didn't -- you reported improved results -- at MGM China also your Mississippi operations doing very well.
Why you're talking about it this slowdown here in the US in a global slowdown that still exists today how are you -- able to overcome that obviously.
-- perform a bit better than your competitors.
Well we we invest a lot and I and our properties.
We're very -- of the -- support following terms equality.
And lot of studies have proven this out it's certainly the case with us is that.
You get premiums to market share -- get a premium costs term if you have a higher marketshare at the property so what is said the yes of course photo.
We believe with the best people and our business and debt that's helped to service levels quite a bit.
And yeah we we have driven our loyalty programs.
To a point where we're able to cross market very effectively and build some market share within these markets that have slow down.
We've just been able to do a bit better than the markets themselves Jim are you would all concerned about Internet gambling in the extent to which obviously he's got a lot of regulatory hurdles but if -- if those go away -- if they do allow it war.
Would that cut in your business.
We're actually a proponent of legalizing Internet poker we prefer to -- get the federal level but doesn't seem like congress can get much accomplished so.
We're not counting on that it could happen at a state by state level that seems be happening right now.
We want to see that happened legalizing it I mean why are these people -- we want to -- debt it is folks would have from the outside might say AG that.
That -- people would go to casinos is much.
Well the issues that millions Americans today are gambling on the Internet but they're doing it illegally and they're no safeguards no protections for underage gaming.
For compulsive gaming.
For nefarious.
Activity money laundering except -- so.
We understand that in our business.
That our reputation is everything to us we hope these up privilege licenses.
We have a lot to risk.
About it illicit behavior.
So we'd like to see it regulated brought into the light of the day and yes will Morton people gamble up potentially.
That that's but certainly probably true.
But we're not -- slot parlor kind of company we're not a convenience gaming company were resort based company.
Which is not intimidated by that form of gaming.
As long it's is done in a regulated way I think it would not impact our bricks and mortar resorts that we have.
-- agenda a lot of investors looking -- your stock today up 7% it's.
Actually underperforming the broader market down about 3% so far this year analysts have called achieved with a PE of just Q.
You know how do you explain the fact your underperforming the broader market for -- -- love the stock that you're not getting the interest from investors.
You know I think ticked.
I was -- beat -- so I have to go back to that.
People wanna see whether or not a company like ours that has significant property leverage.
In hospitality business.
Can perform in this kind of economy and whether or not the overall economy.
Is going to improve or not.
We're very much tied to the US economy in investors minds and I think that's probably fair.
Our goal is to continue -- -- on the plan.
We set out a plan three years ago to rebuild our balance sheet and we've been methodically.
-- very consistently doing so to a point where.
Today our balance sheet.
And our financial condition.
Is in the best shape it's been in any point in time over the past three years if we continue to execute on this plan.
I have a feeling that investors will be rewarded.
I'm not at all surprised.
Given people's uncertainty about the US economy and global economies.
That we've underperform for the year I can't control that.
What we're trying to control what our company.
-- to maximize -- free cash increase liquidity extend out maturities.
Improve the balance sheet and we'll see how we do from there are -- good luck to you dimmer and and G and thanks for joining us -- earnings that appreciate it.
Thank you --
