Friday, December 5, 2008

Tribe In The News: Mohegan Gaming Authority Issues 4th Quarter Earnings

Feather News

The following three articles appeared regarding the Mohegan Tribal Gaming Authority's release of its 4th quarter earnings (profit) report. Each article is from a different local newspaper. Note that The Day newspaper does not mention the actual earnings (profits), also known as 'the bottom line.'

The earings report confirms that Pocono Downs, the Tribe's racetrack-slot parlor in Pennsylvania, is losing money after taking into account interest expense.

A detailed analysis of the earnings report and other details of the press release will appear soon on the Feather News.

Mohegan Sun suffers economic losses in 2008
Norwich Bulletin
December 4, 2008

Mohegan, Conn. — In the last year, fewer people gambled, shopped, ate and spent the night at Mohegan Sun, the result of people adjusting their entertainment budgets in light of the nation’s recession. While not necessarily surprising, the fourth quarter and fiscal year 2008 operating results announced by the Mohegan Tribal Gaming Authority Thursday showed significant decreases in income for the tribe. In fiscal year 2008, the tribe’s net income was $152.8 million, an 11.5 percent decrease from fiscal year 2007.

Sun Profits Lower; Job Cuts At Foxwoods
By Eric Gershon
The Hartford Courant
December 5, 2008

For the Mohegans and Pequots alike, the recession is hurting operations further, with lower profits at Mohegan Sun and new job cuts at Foxwoods.

Mohegan Sun casino on Thursday reported declining revenues for the fourth quarter and full year.

Net income fell 12 percent for the fiscal year that ended Sept. 30 at the casino, owned by the Mohegan Tribal Gaming Authority. Total gaming revenues and slot revenues fell by about 4 percent.

In the last quarter, Mohegan Sun's gaming revenues dropped by 5.4 percent, to $374 million, even as the casino's take from table games increased slightly. Gross slot revenues — the money that's shared by the state — fell by 7.9 percent, to $276 million.

Net income rose for the quarter because of a non-cash accounting change.

A day earlier, the Mashantucket Pequots, who own Foxwoods Resort Casino, offered buyouts to all 729 employees of tribal government except the seven members of the tribal council. A tribal spokeswoman would not say how many positions will be cut but said layoffs will follow, if necessary.

The Pequots — which had already cut about 900 casino jobs and 200 tribal jobs this year, including that of the chief executive — said the latest reductions would be done by Dec. 31.

The casinos are bringing in less money, which they attribute to depressed consumer confidence, increased competition in the Northeast and the recession in general.

Mitchell G. Etess, CEO of the Mohegan authority, said the tribe has no near-term plan for buyouts or layoffs.

Mohegan Sun credits recent success to 'proactive' strategy
By Brian Hallenbeck
The Day Newspaper
November 5, 2008

Mohegan — Mohegan Sun executives told investors Thursday that a “proactive” approach to controlling costs enabled Mohegan Sun to maintain its leading share of the Connecticut gaming market in the last quarter of the fiscal year that ended Sept. 30.

Amid industrywide revenue declines and despite a major expansion by its competitor, Foxwoods Resort Casino, which opened MGM Grand at Foxwoods in May, the Sun captured a 52.2 percent share of the market during the quarter, the Mohegan Tribal Gaming Authority reported during a conference call. Mohegan halted its own expansion project in September, and has saved on labor and promotional costs through prudent planning, Mitchell Etess, the authority's chief executive officer, said.

Nevertheless, the authority's $373.7 million in gaming revenues during July, August and September represented a 5.4 percent decline over the same period in 2007. For the fiscal year — Oct. 1, 2007 to Sept. 30, 2008 — gaming revenues at Mohegan Sun and at Mohegan Sun at Pocono Downs in Wilkes-Barre, Pa., totaled $1.41 billion, a 4 percent decline over the previous year. An expansion of the Pocono Downs facility opened in July.

Table-games revenues were up 1.8 percent over the fourth quarter of the fiscal year, while slot revenues were down 7.9 percent. For the fiscal year, table-games and slot revenues decreased 3.1 and 4.3 percent, respectively.

Mohegan Sun's fourth-quarter labor savings were achieved through a 7 percent decrease in the number of casino employees, though none was laid off, Etess said in a telephone interview later in the day. “If we find we have excess people in a department, we have them do other jobs,” he said. “When people leave, we don't replace them.”

Jeffrey Hartmann, the authority's chief operating officer, said the Casino of the Wind, which opened in August, adding 65,000 square feet of gaming space, including a poker room, and the Margaritaville restaurant, has been a resounding success. In 2009, he said, the authority expects to complete renovations of the casino's Winter Garage and Winter Entrance, which will feature a new retail area, including a Frank Pepe Pizzeria.

Hartmann said final approvals are expected next year for a casino project the Mohegans plan to develop with the Cowlitz Indians in LaCenter, Wash. However, he said he was “less optimistic today than we were 90 days ago” about a Kenosha, Wis., casino project the Mohegans have pursued with the Menominee Tribe, which last month filed a federal lawsuit over the review process for the off-reservation project.