MGM Resorts International, a Las Vegas-based casino company, has announced a plan to cut as many as 1,000 jobs by summer. The layoffs were announced earlier in the week, with positions being removed from the company in order to reduce cost and increase earnings. Because MGM Resorts owns the Gold Strike Casino in Tunica, employees in Mississippi are fearful of losing employment.
According to Corey Sanders, the Chief Financial Officer of MGM, a total of 35 executives of the company have taken a voluntary retirement. The move is part of the 2020 plan for the company, an effort to try and increase annual earnings by 2021 by an amount of $300 million.
First quarter earnings for 2019 were just over 12% higher from the same time frame in 2018. However, cash flow for Las Vegas dropped considerably by around 10%.
According to wreg.com…
MGM has yet to reveal where the employment positions will be cut from. The cut is expected by June. Employees in Tunica are worried that the Gold Strike Casino Resort will be involved in the cut. Tunica has been hit hard as of late with companies announcing the closure of casinos, laying off hundreds in the process. The Penn National company was the latest to announce a closure in the region, with the Resorts Casino Tunica set to close on June 30th.
In the early 1990s, Tunica County legalized gambling and was the only region for hundreds of miles to offer casino gaming. However, by the mid-2000s, the region saw a drop in revenues and have yet to be able to recover.
Cost Savings Initiatives:
MGM Resorts Int’l first announced cost-savings initiatives back in January. In late April, they followed through with their plan by eliminating 254 senior management positions. The move was made due to investor pressure to improve earnings so that share pricing will increase.