MGM Resorts Reassigns Top Managers as Company Awaits Word on COVID Restrictions
MGM Resorts International once again has reshuffled its top management in the midst of the coronavirus pandemic. The move comes as Nevada’s casino operators face an uncertain future given that additional COVID-19 restrictions are being weighed by Gov. Steve Sisolak (D).
Under the company’s reassignment plan, Corey Sanders is returning to the post of chief operating officer, the Las Vegas Review-Journal reported. He will remain as chief financial officer, his current post, until a replacement is found.
Also, Atif Rafiq will leave as MGM’s president of commercial and growth, the report said. Anton Nikodemus, president and chief operating officer of MGM’s Las Vegas portfolio, is becoming president of CityCenter, which is a mixed-use complex located on 76 acres on the Las Vegas Strip.
In addition, Ann Hoff, who was MGM Resorts’ chief marketing officer, will lead the Bellagio and Park MGM properties, the report adds.
The reshuffling was announced late last week by MGM’s new CEO and President Bill Hornbuckle in an internal memo that was obtained by the Review-Journal.
I feel confident that this plan will help us grow the company and build us back stronger than ever before,” Hornbuckle said in the memo.
“I truly believe that our best days are in front of us, and together this leadership team will bring this company to new heights.”
When asked about the reshuffle, the Rev. Richard McGowan, a finance professor at Boston College who closely follows the gambling sector, recalled how MGM in October offered $750 million in senior notes.
MGM just received $750 million in new financing so the thought is that new management will bring new ideas on how to utilize those funds,” McGowan told Casino.org. “Even before the pandemic, MGM was not doing well at all, so in many ways, this is an attempt to save the firm.”
He added that the new management team “needs to reduce the number of operations and increase the profitability of the remaining casinos. They also need to increase the entertainment portion of their casino operations.”
In May, when executive layoffs took place at MGM Resorts’ property level, McGowan predicted, “I would be very surprised if more layoffs did not happen. The casino industry in those areas where there is too much saturation will be experiencing complete closures.”
Business Could Be Normal in About Six Months
When asked about the latest management reshuffle at MGM, Anthony Cabot, Distinguished Fellow of Gaming Law at UNLV’s Boyd School of Law, noted that “most of the major casino companies have the same issue: how to reduce costs until business can return to normal in about six months.”
Coronavirus vaccines should be widely available nationally in several months. But a recent surge in cases is threatening a limited recovery in the gaming sector.
Last month, Sisolak ordered that Nevada casinos and restaurants lower their capacity to 25 percent from the earlier 50 percent. That new directive lasts for at least three weeks.
The directive led Las Vegas Mayor Carolyn Goodman to call Sisolak “a dictator” and said his new coronavirus policies will be “crushing to the city.”
If the COVID-19 spike does not improve, Sisolak later this month could impose further restrictions on non-essential businesses. Nevada casinos and other non-essential businesses were shuttered for several months earlier this year in an effort to curb the spread of the virus.
On Sunday, Nevada officials reported 2,511 new cases of COVID-19 and 14 more deaths. Since the outbreak began, the state has seen 168,139 cases of the virus. Total deaths are now 2,315.
Prior Cuts, Management Plans
Recently, due to lower demand associated with the pandemic, MGM Resorts announced midweek closures at several Las Vegas hotel properties — through at least the end of this month. These include the Mirage and Mandalay Bay.
Earlier, Park MGM closed its hotel tower Mondays through Thursdays. But casinos and restaurants remain open midweek at the three properties.
In August, MGM laid off 18,000 furloughed workers. Prior to the coronavirus pandemic, MGM Resorts employed 70,000 workers in the US.
In 2019, well before the pandemic, MGM Resorts laid off 254 managers as part of an effort to reduce labor costs by $100 million.
Casino operators have been trying to diversify by having casinos in Asia, but that “was not the solution to this crisis because they also were impacted,” Anthony Cabot told Casino.org. “These cost reductions impact every level of the companies from frontline workers to the executive offices.”
Casino.org reached out to an MGM spokesman about the company’s latest management reshuffle, but did not hear back immediately.
Last week, Virgin Hotels Las Vegas announced that its planned opening of its gaming property was delayed again due to the conditions associated with the pandemic.
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