Mon, May 6, 12:41pm by Staff Writer
MGM Resorts International says it expects to cut about 1,000 jobs by June.
WREG is reporting that the layoffs include 254 jobs the company said last week it would cut as it works to reduce costs and boost earnings.
Chief Financial Officer Corey Sanders says 35 executives have already taken voluntary retirement as part of the MGM 2020 plan.
It’s an effect to increase annual earnings by $300 million by 2021.
The job cuts were first flagged at the start of the year as a way of delivering the company uplift in revenue.
Calvin Ayre reported that this ‘company wide, business-optimisation initiative’ is intended to maximise profits by, among other things, centralising ‘key company wide functions’ and investing in technology ‘to lay the groundwork for the company’s digital transformation to drive revenue growth.’
MGM acknowledge that half of the $200 million of earning the company expects to achieve by the end of 2020 will come through ‘labor savings.’
The savings potentially imply 2,000 jobs cuts, although most of those layoffs will be managers or higher, the company said some union jobs could be eliminated, according to the Las Vegas Review Journal.
In May 2018, MGM Resorts said it planned to boost its operating cash by as much as 39 per cent to $3.9 billion by 2020.
At the time of this announcement, Union Gaming analyst John DeCree said: “with a playbook in hand, we have greater onviction in the long-term forecast.”
The company reported revenue was 12.6 per cent higher during this year’s first quarter than for the same period in 2018 but that its cash flow in Las Vegas dropped by 10 per cent.
MGM Chairman and CEO Jim Murren says the company’s regional properties reported improved performance.
RETAIL: MGM Resorts to cut costs, slash 1,000 jobs https://t.co/HRiu7T6dnd
— LayoffsNews (@LayoffsN) April 30, 2019
MGM has not said where jobs will be cut, but it is sure to put workers in Tunica County, Mississippi on edge as MGM Resorts owns Gold Strike Casino Resort.
The area has been dealt blow after blow recently as one company after another announces closures of their casinos, laying off hundreds of people.
Most recently Penn National Gaming announced it would close the Resorts Casino Tunica on June 30.
Tunica Country boomed when gambling was legalised in 1992, becoming the only gambling destination for hundreds of miles.
Employment at casinos peaked at 13,000 jobs in 2001, falling to less than 5,000 now and revenues have been falling since 2006.
Revenues in Tunica have shown an uptick in recent months since Mississippi legalised sports betting, but it’s unclear if that will be a long-term improvement.
Resorts was the smallest casino remaining in terms of slot machines and table games after Caesars Entertainment closed Tunica Roadhouse in January.
Caesars closed the massive Harrah’s Tunica Hotel and Casino in 2014 when it was in bankruptcy.
Tunica suffered in part because of increased gambling competition in Arkansas and other states.
Arkansas voters earlier this month approved a referendum allowing four full-fledged casinos, including one at Southland Gaming and Racing in nearby West Memphis.
Arkansas tax figures show Southland won $222 million from gamblers in the 12 months ended June 30, up more than 50 per cent since 2014.
Operator Delaware North announced a $250 million expansion of Southland in January.
The closures mean less tax revenue for state and local governments.
Tunica County has struggled with declining tax revenue, with country supervisors having to step in and subsidize a full time fire department that protects the unincorporated area of the county that includes the casino because property tax collections fell after Harrah’s closed.
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