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Mohegan's Financial Performance for Q4 and FY 2024

As the Mohegan Tribal Gaming Authority (Mohegan) wraps up its fiscal year, the organization announced impressive operating results for both the fourth quarter and the entire fiscal year 2024, ending September 30. Achieving significant milestones, Mohegan's performance illustrates both immense growth and challenging hurdles.

Fourth Quarter Highlights

In the fourth quarter of 2024, Mohegan achieved net revenues of $497.7 million, marking a 12% increase compared to the previous year. This achievement stands as the second-highest quarterly net revenue in the company’s history. A substantial contributor to this growth was Mohegan Digital, which reported a 59.9% increase in adjusted EBITDA year-over-year. Notably, the performance of Mohegan INSPIRE, the company’s latest integrated resort in South Korea, generated net revenues of $62.2 million since its opening.

CEO Raymond Pineault emphasized the importance of this period, stating that it highlights the transformation of Mohegan from a regional casino to a global omni-channel resort operator over the past three decades.

Annual Performance Overview

For the full fiscal year 2024, Mohegan reported a 13% increase in annual net revenues, totaling $1.9 billion. This achievement marks the highest annual revenue Mohegan has seen to date. The addition of Mohegan INSPIRE and the success in digital gaming contributed significantly to this figure, as Mohegan Digital net revenues soared by $60.1 million compared to the previous year, totaling $160.7 million.

Despite these positive highlights, the financial landscape shows mixed results. Adjusted EBITDA for the fiscal year saw a decline of $50.9 million compared to the previous year, indicating that while revenues grew, operating expenses, particularly related to the opening of Mohegan INSPIRE, have intensified.

Detailed Financial Insights

Mohegan’s financial results exhibit both strengths and challenges:

• - Net revenues for Domestic Resorts: $327.1 million in Q4, up by $36.2 million year-over-year, fueled by rising gaming and non-gaming revenue, especially in entertainment.
• - International Resorts: While experiencing a year-over-year revenue increase amounting to $133.6 million, the operating losses raised questions about sustainability. The total revenue reached $448.2 million, with adjusted EBITDA losses largely attributed to the operating costs of Mohegan INSPIRE.
• - Mohegan Digital Operations: The digital segment saw promising growth, representing the bright spot in Mohegan's performance with net revenues declining slightly to $43.9 million in Q4, influenced by previous accounting adjustments.

Ongoing Challenges

Despite showcasing strong revenue growth, Mohegan faces significant challenges moving forward. The accumulation of operating costs from new venues, high table hold, and non-cash adjustments to customer contract assets in partnerships are notable concerns. Additionally, with upcoming debt maturities and looming covenant violations, there are considerable risks that could impact investor confidence.

Conclusion

In summary, Mohegan’s fourth quarter and full year 2024 results reflect a complex yet promising landscape, balancing significant revenue gains with ongoing operational and financial challenges. As the company continues to adapt its strategies to this evolving environment, stakeholders remain keen to see how Mohegan will navigate these challenges while pushing for further growth in the coming years. Moreover, with its diversified portfolio and the integration of digital solutions, the company is well-placed in the competitive entertainment and gaming industry.