Good afternoon and welcome to the MGM Resorts International Second Quarter 2021 Earnings Conference Call. Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President; Corey Sanders, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer; Hubert Wang, President and Chief Operating Officer of MGM China; and Cathy Park, Executive Director of Investor Relations. Participants are in a listen-only mode. After the company's remarks, there will be a question and answer session. In fairness to all participants, please limit yourself to one question and one follow-up. Please note this conference is being recorded. Now, I would like to turn the call over to Cathy Park. Please go ahead.

Thanks, Chad. This call is being broadcast live on the Internet at investors.mgmresorts.com and we have also furnished our press release on Form 8-K to the SEC. On this call, we will make forward-looking statements under the Safe Harbor provisions of the federal securities laws. Actual results may differ materially from those contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise. During the call, we'll also discuss non-GAAP financial measures, in talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation, which are available on our website. Finally, this presentation is being recorded. I will now turn it over to Bill Hornbuckle.

Thank you, Cathy, and thank you all for joining us today. Over the past few months, we've had the honor and the privilege of welcoming back guests back to our properties at a remarkable pace, both in Las Vegas and our regional markets. It's been rewarding to see our guests taking in all the world-class gaming and entertainment experiences that only MGM Resorts can provide. And it's been equally gratifying to witness the tremendous effort of our employees, delivering these experiences. We have an amazing team of people here at MGM Resorts, the best in the business. And so, I'd like to take this time to thank them today for their hard work and dedication to our company and our guests, especially over the last 18 months. I can't say enough how critically important they have been and will continue to be to our success, as we carry out our vision to be the world's premier gaming and entertainment company. In fact, investing in our people in our planet is the foundation, upon which we've built our strategic plan for the company's long-term vision. Our strategic plan consist of the following four priorities, investing in our people in our planet, providing unique experiences for our guests by leveraging data-driven customer insights and digital capabilities, delivering operational excellence at every level, and allocating our capital responsibly to drive the highest returns for our shareholders. In driving our vision, we have long discussed our goals of simplifying our corporate structure and monetizing our real estate premium valuations to become asset light. We've been busy on this front, and over the past 90 days, we've meaningfully advanced this strategy. In May, we announced an agreement to sell and leaseback MGM Springfield, underlying real estate to MGM Growth Properties. We followed that news in…

Thanks a lot, Bill. Let's first discuss our second quarter results. Our consolidated second quarter net revenues were $2.3 billion, significantly better sequentially over our first quarter results. Our net income attributable to MGM Resorts was $105 million and our second quarter adjusted EBITDAR improved sequentially to $617 million, once again heavily driven by our domestic operations. Our Las Vegas Strip net revenues in the second quarter were $1 billion, 31% below the second quarter of 2019 and 28% below excluding Circus Las Vegas, which was sold at the end of 2019. Despite the lower top line, we delivered far superior EBITDA results. Our second quarter adjusted property EBITDAR was $397 million, which is 5% below the second quarter of 2019 and just 1% lower excluding Circus Circus. Hold had a $6 million negative impact to our EBITDA this quarter. So Hold-adjusted Strip EBITDAR in Las Vegas was $403 million. Our Strip margins improved almost 1100 basis points to an all-time record of 39.5% and this does not include the results of CityCenter, which generated $120 million of EBITDAR at a 46% margin. As Bill mentioned in his remarks, our margin improvement was driven by a combination of strong leisure and casino demand, continued cost control and the operating leverage inherent in our business. Naturally with limited convention business and entertainment, we are driving more visitation from customers that we know. And our second quarter casino room mix was 9 points above pre-COVID levels. Furthermore, our second quarter casino revenues were 15% above 2019 levels and contributed to 35% of our overall net revenues in the second quarter. This compares to roughly 22% in all of 2019. We're seeing particular strength in the slot customer. Our second quarter slot handle was 23% greater than that of the second quarter of…

Thanks, Jonathan. We're very pleased, obviously with all we've accomplished thus far this year. Our strategic actions together with the improving domestic backdrop, continued focus on operational excellence, and strong conviction in Macau's recovery position us very well for the future. There's a lot to be excited about when we think about our path on delivering our long-term vision. We remain focused, disciplined, and ultimately transparent. With that, we'll open to your questions. Thank you.

[Operator Instructions] And our first question will come from Joe Greff with JPMorgan. Please go ahead.

I want to start off by talking about to you, Bill and Jonathan, what you just referred to as a sizable, deployable cash position. Obviously, you have Japan out there and that is not sort of a near-term thing and that's uncertain. You've been doing buybacks? Maybe you can talk a little bit about maybe where M&A is and how much of a front burner priority for you. And just in general discuss your M&A aspirations and how you look at M&A as achieving whatever goals you have - yet discussed, maybe at the internal executive level or the Board level? Thank you.

That's a simple question, Joe thank you. Look, Jonathan said it, I've said it you've heard us say it consistently. We are committed to becoming the premier gaming entertainment company in the world. We'd like to think we hold the key position in it already. We have expressed desires in digital, the obvious I must say our strategy doesn't refer and hinge simply on one other company. We are very excited by our JV with BetMGM and we continue to grow that we have a great working relationship with that and it's productive. Jonathan has already shared the company's position on share buybacks and we'll continue to look. But the good news is, I mean we've got six or nine months before these transactions close and time is our friend. And so, we're going to be disciplined about the approach.

Joe, it's Jonathan, I would only add that it is - it is such a dynamic environment right now, we are certainly all hands on deck as our operations continue to grow and recover here in the U.S. We do believe the shares are attractively valued right now, which is why we've been active in the market. We expect to continue to be so. But I really like our position in terms of our current liquidity and the expected liquidity with the transactions in Springfield and with Vici to be in a good position just with the way that things continue to change and we expect them to evolve over the next several months and years.

Great, thank you for that. Maybe you can just talk in some greater detail, both for the Las Vegas Strip and then the regional markets in general, labor challenges, finding people and then wage pressure is going? How much of the mismatch is there with – in the expense growth in the 2Q with the exit rate on the expenses in the margins different than it was for the full quarter given maybe a lag in operating expense pressure.

Yes, I'll turn this to Corey in a second, but just kick it off by saying, look I think I like the balance of the whole hospitality industry. We are suffering universally our share of labor shortages, some supply chain issues, they're not critical, but they are important. We've done everything we can. We've done incentives and other things to motivate people back to work. I think we all believe come the end of September, we'll hopefully see some increase in terms of people's willingness between the negotiations here, particularly with the legislature in Nevada unemployment hopefully weighing in some respects, but we've been managing through it and effectively. I think the team has done a really good job with it. It has hampered some midweek occupancies and - we have pushed up our business and therefore our ADRs and we've yielded effectively and so I think it's helped our margins. So Corey, I don't know if you want to pick it up from there.

Yes, what I would add Joe is, we've made a lot of headway over the last few weeks in finding the labor that we needed. As Bill mentioned, we have had some incentives. It's not going to be very material at all on the impact of our labor cost.

What we're trying to do everything we can not to completely change the paradigm now until things settle in. And so, we continue to think about it in that context.

Great, thank you guys.

The next question is from Chad Beynon with Macquarie. Please go ahead.

Thanks for taking my question. As you think about your timeline in Las Vegas in terms of getting back to 2019 levels, given the strength on the hotel side on week - particularly on weekends and you're gaming market share right now. Can you help us think about how that's changed in terms of when you believe you can get back to pre-pandemic levels on a revenue or EBITDA basis? Thanks.

Corey?

Yes, Chad hi. The question has been asked in the last few quarters, when we think we'll get back to 90% and I think we're there and that has accelerated. I think when we get back to exact on 2019 levels will be when the convention business comes back in a pretty solid level. We're seeing some pretty positive bookings and trends in 2022, so it could be as early as the first or second quarter of 2022 that were at 2019 levels, especially on the non-gaming revenues.

I mean mid-week and really through the balance of this year, we're going to have about a 1.2 million group room nights, give or take. Obviously, we're all watching COVID closely in the coming weeks here, but we've had very limited cancellations, we've actually had a couple of upticks interestingly. And so that will be paramount to really setting the stage going forward. But again, long-term 2022 and 2023 fundamentally are looking great, and we've had no substantive cancellations given even what's happened in the last week. So I think Corey's estimate is spot on.

Great, thanks. And then on the digital side at the BetMGM Investor Day, you talked about market share goals, which you're already exceeding. I think in the next couple of months, you will see some additional competition, but then on your side, I believe, a lot of your retention tools will be in place. Can you just talk about what you have in place over the next couple of months to help retain the customers that – that you're currently doing business with?

Well, obviously you heard yesterday on Tom's call, they're going to step into the space in a subjective way now and chase it with about $1 billion. So there'll be a real competitor. And if you think about what they do and what we do, it's the most likely competitor to us in the context of same-store loyalty presentation, ability to omnichannel and monetize across a broader platform brick and mortar as well as digital. We are heavily into our loyalty push. We have appointed several senior executives both here and at BetMGM, who are marketing focused on doing exactly that. You heard me express earlier the amount of interchange between BetMGM and M-life and vice versa. And we also have a strong push in moving regional play through BetMGM and through just the regional properties back at Las Vegas. We'll have yet another product launch coming up here very soon. If you look at the deck, we provided - you can see some of those product enhancements. The team at BetMGM is working around the clock on this to get it prepared for football and I think it will speak to a lot of things of note loyalty, retention, and our ability to lower our ultimate CPA, which is the goal, here will stick.

The next question will be from Carlo Santarelli with Deutsche Bank. Please go ahead.

Jonathan, you gave a lot of color, as you were trying to talk through the puts and takes of the Las Vegas Strip margin profile going forward. But if you talk a little bit about CityCenter and - sorry excuse me, Circus Circus removal, you guys did in the period about $400 million less of revenue. As you think about kind of being at 40% margin level and in that incremental $400 million of revenue that should come back over time? Is it being overly conservative to say that kind of margins do compress over the long-term, or is there some spend here over the medium term that might kind of bring margins in a little bit before they could rise again from kind of the natural operating leverage of getting that revenue back?

Yes, thank you for the question, Carlo, and it's well posed, because there are a few dynamics going on here. One is certainly the just the higher levels of casino spend from our customers that we've been experiencing over the past six months and we're not simply just kind of taking this business, we are driving that demand through our marketing channels. And so, we've earned those revenue levels for sure. But they are elevated compared to what they've been in the past and that's what I referred to in our remarks is some expectation that over time as other avenues for spending are available in our properties that perhaps that mix normalizes a bit, but at the same time our hotel RevPAR is still below, where it was back in 2019 fairly materially both by occupancy, as well as overall rates. And that presents tremendous upside, that's high margin revenue for us. We fully expect to be able to get back to those levels over the next year or so and that will lead to - that will be very profitable revenue growth for us, at the same time much of that of course is going to come with the recovery of the group business. So there are the puts and takes as you put it. We're just - we're doing the best we can to account in the future for the impact that some of our labor additions are expected to have, but there are clearly sources of upside in revenue and even margin performance mostly around the hotel mix.

And what I would add - what I would add Carlo is a few pieces of our business that are missing, we just opened up the restaurants. There is an opportunity to make some additional EBITDA there. Yes, it will be a little bit less margin and then the entertainment side and we're seeing some great demand there that also will put a little bit of pressure on our margins, but it will increase our cash flows.

Thanks, Corey. That's helpful. Thank you both for that. And then if I could just one follow-up and it's kind of small and nitpicky, but could you guys kind of talk a little bit about the tax implications of the MGP/VICI transaction for you guys, the $4.4 billion of cash receive and perhaps the rationale behind kind of holding on those 12 million OP units, is that something tax related?

It is. So in broad strokes, what will happen is VICI and MGP will merge and MGM's OP units or the vast majority of them will be redeemed for cash and that - $4.4 billion in cash, and that will be tax deferred and in keeping the 1% interest in the combined company, what will happen is on those remaining units, those - the basis of those units will be reduced by the amount of the gain that we will have on the $4.4 billion and this will be subject to a 15-year tax protection agreement with VICI, which protects us against that gain being triggered through any sales of the assets. So it's a 15-year tax deferred receipt of $4.4 billion and the remaining interest is critical to that - to that tax analysis.

Great. That sounds like it was probably a very fun negotiation for you guys. Appreciate the color, guys.

All right. Thanks, Carlo.

Thanks. Bye-bye.

And the next question will come from David Katz with Jefferies. Please go ahead.

Thanks for taking my question. As we have listened to companies report and talk about the businesses and their outlook and at the same time, talked with investors about the sustainability of the margin gains that we're seeing primarily out of this quarter. And clearly, we meet an amount of cynicism around everybody's ability to do that. Can you just help us alleviate some of that cynicism and why we should be comfortable that the margin gains will be reasonably permanent.

Well, David, let me - let me kick it off and maybe Corey can jump on here. In the margin that we did this quarter is not sustainable, I think we've said that in a couple of different ways, but what I think it's really relevant is that where we are versus where we're going to end up is a substantial difference up. And so as high - high value, high revenue, high cost things like a Lady Gaga show come into play, it just - it works on your margins, given particularly as the higher-end business returns, whether it'd be ultimately from Asia or other places. It will kick in. And so, I don't think - I hope you haven't heard us say we're going to sustain, where we are this quarter that wasn't the message. The message is we have learned a lot. We're going to be appreciably better than we've been in, I can't remember in our history and there are certain things we'll never do again, whether it's buffet openings or how we think about labor or services or products, given what we've all gone through for the last 18 months, there's a massive amount of learnings, if I'd even think about our business, I mean just look at our corporate enterprise, we had 4750 FTEs, we're under 3,000 today. We will never go back to 4750 FTEs full stop. And so, I hope the message is, from our perspective, we're not going to sustain where we are, but they will be much better than they've ever been historically and I'm pretty excited about where I think they're going to end up ultimately.

That was relatively clear, I could have asked the question just a little bit better and if I can follow up quickly, with respect to the loyalty program. Jonathan, I recall you making some commentary in investor meetings about the opportunities to build M life out in a lot of different directions and grow it, an update there would be helpful. Thank you.

Sure and I appreciate you bringing it up, because I do - I know this is a huge opportunity for MGM Resorts, I mean we have a fantastic loyalty program with 36 million members, which is growing in significant part by BetMGM right now. And so it's a - it's a large and important loyalty program and where I think some of the sources of upside are particularly around cross property play here in Las Vegas and kind of the transparent portability of those rewards across the network in Las Vegas. And then in driving regional customers of ours and members of the M-life Loyalty Program to our properties, when they visit in Las Vegas, which we know that they already do. I think that this effort of course is led by Steve Zanella, our Chief Commercial Officer. But here is where Tilak Mandadi has phenomenal talent that has just joined us from Walt Disney is going to be hugely impactful, as he helps us really build out the technology platform and the overall design of that of that program in its next instance, so there's - there's a lot of work going on around that effort right now. And I'm really confident it's going to have a real impact for us in 2022.

And just a few data points to that, we have just began some of these initiatives. Our cross regional for the quarter was actually up 25%, so we're pretty excited about that opportunity there. We're just touching the surface and even when we talk about BetMGM and what it means to a property, our Detroit active M-life customers in Q2 were actually up 40% from Q4 2019. So we're seeing that actual sign up in that market actually translate to bricks and mortar customers and you actually would see that in the July results, which Detroit does publish the results we had a record market share in Detroit.

And David, maybe a final comment there is four areas, we're consistently after the high end. And so, we're looking at the program and modifying it and making sure digitally more things are accessible. We're after retail high end, meaning I don't mean retail stores, I mean we have a great deal of business that roams around here that aren't principally gaming customers that we think there is an opportunity to recognize with loyalty. Obviously, the regional play that Corey has mentioned and Jonathan at BetMGM are really the four key drivers. And one interesting tidbit I'd stumbled on this morning, Corey just mentioned it somewhat in Michigan, one of the questions that's come up with BetMGM is about cannibalization. It's interesting, Detroit just got 46.5% market share in brick and mortar and we lead the market in iGaming at 38% and that's an increase from the mid-30s, we were 43% in June, we're 46.5% in July and we're holding a 38% market share in iGaming. And so the idea that omnichannel can and will work and not be cannibalizing is something I'm very excited by moving forward.

The next question comes from Thomas Allen with Morgan Stanley. Please go ahead.

So actually, following up on this conversation, if we look at Slide 24 of your presentation, you had 15% of new BetMGM players in 2Q were active with MGM. That's up from 10% last quarter and then you had 31% of new M-life players in 2Q from BetMGM and is down from 44% last quarter. Can you kind of talk about what's driving the difference in trend between those two numbers and like how to think about it going forward next year?

Well, I think the second one's the easier one, we've just seen that many more - I mean, the volume between the first and second quarter and how there's - and Michigan, by the way how it grew is just - it's overpowering and thankfully, so I think that explains that more than anything. And I'm sorry. Tom, the first one?

So the first one, so in the first quarter 10% of your BetMGM players were legacy MGM players and second quarter went up to 15%, what drove that increase?

Well, Michigan a lot and then we continued to push on programing host et cetera, in terms of incentives and otherwise, to get them to sign up our customers. And we're just more active in the database in terms of making BetMGM known to them and available to them.

And then, I see you reiterated your - your $1 billion of revenue next year for BetMGM, I mean, you did 357 in the first half of this year, I mean, essential upside there, now.

We do, remember iGaming just got going second, really into the second quarter, not even in the first quarter, you've got football I think with better programing, better database to pull upon, we've got a couple of states that are on the horizon of coming out, you've got Maryland, you've got something we've just done in DC, Arizona's around the corner. So I think between an increase in states the full year, if you will, of iGaming and some other potential things that we continue to market, hence the numbers we just talked about. We feel pretty comfortable about the GGR - BetMGM, excuse me.

The next question will be from Shaun Kelley with Bank of America. Please go ahead.

Just following up on the VICI transaction and congratulations on all the myriad of activity, I was wondering if you could just give a little guidance as we're trying to think about maybe cash flow bridges, one would be I'm sort of calculating pro forma rent expense for all these different things becoming out in the kind of $1.6 billion to $1.7 billion range. So first question is, am I in the right ballpark for that? And then second would be sort of directionally, how should we think about cash taxes across the enterprise, after all these moving pieces settle into 2022?

Yes. You are in the right ballpark. The changes are really the city center, which we expect to close at the end of the third quarter and that will introduce increased rent of $215 million, so you'll be - you'll be close on that. And then regarding the cash taxes, that's something that's still - we're still working on right now as it relates to 2022. So, I think I'd prefer to defer that question until we get a little bit later in the year.

Understandable. Maybe just as a follow-up, you talked a lot about the gaming behavior and the increase in your casino block, just kind of curious if you could give us a sense across your different channels, what's OTA doing right now, how important is that, is that an area where you can maybe change the mix more permanently or just how are you thinking about some of that, pretty that hotel revenue mix going forward in more of a steady state?

Sure. Shaun, this is Corey. Yes, that's one of our big strategies that we're definitely working on. We are working on pre-COVID is the mix in maximizing that mix, and we've had a lot of success in this period and we've been able to increase our transient mix, obviously, as Jonathan mentioned in his opening comments, the casino mix is up. But more importantly, we're shifting the mix from the OTA package business, which is our least profitable business and seen increases in the land business, which is very similar to our transient business. So we're very optimistic on what we're seeing there and when that convention business comes back, we think there is additional opportunities to maximize our mix.

And the next question comes from Stephen Grambling with Goldman Sachs. Please go ahead.

Maybe you touched base on this a little bit, but turning to Japan, can you just remind us what the capital contributions you'd be anticipating over the next couple of years. And as you become more asset light, what is the potential to bring in REITs or other sources of capital into that market to reduce your intensity there?

So on its surface, remember the program with Orix is 40-40-20, meaning a consortium all the Japanese companies will make up to 20%, if not we both fill to 50. The project itself is call it $10 billion, we think it's a little lower but, call it $10 billion for simple math, call it 55% debt to equity. So for us it's a $2 billion to $2.25 billion check probably over '24, '25, and '26, give or take if you want to think about how that might flow itself through the - through the system. I think longer term, look, there is a commitment, we are making to Japan and to Osaka that we would be a true partner in this. There is an actual requirement for 30% equity in it to be - to be classified or qualified if you will, but REITs are something that are in Japan, and so I think longer-term we'll see, but in the short term, it's about a $2 billion to $2.5 billion cash commitment over three years. And depending on, again on license '24, '25, and '26 is probably the best way to think about that.

And then sticking with maybe capital allocation, how do you think about the allocation of proceeds from VICI, is it similar or different than cash from operations and then has your thought process around the right leverage ratio for an asset light business evolve. Thank you.

Yes. Thank you for the question, Stephen. You know that that transaction is expected to close in the first half of 2022, so the plans for the allocation of that capital will begin soon. They've already begun actually and - but the actual cash won't come to the company for probably nine months or so. And like I said in the - in the prepared remarks, really our first order of business at these - at these levels, we think our shares are attractively valued, so we'll be aggressive purchasers of those shares. Beyond that, we'll look for opportunities to - inorganic opportunities to really further the company's vision as a premier gaming entertainment company globally. In terms of our leverage targets, the company's capital structure is changing from traditional senior debt structure to the - to the leases that we have and that will certainly - that certainly impacts our thinking about leverage, because the lease payments do represent financial leverage on the business and lease adjusted leverage level of four to five times, we think is reasonable for a business of our geographic diversification. And so that's the way we'll be thinking about it going forward on a lease-adjusted basis.

The next question is from John DeCree with CBRE. Please go ahead.

Thank you for taking my questions. Maybe to build on that, Jonathan or Bill, I think there's still some interest in potential U.S. markets for Casino, New York is one that gets talked about a lot. Not sure if you guys have any comments or thoughts or any of those prospective opportunities, something you see coming to fruition in the near to medium term or are they all kind of longer-dated opportunities that might - that might unfold in the future.

Look, in New York, it was disappointing, we weren't able to get it through the legislature. It was closed. We're going to take another run at it, but the reality of that is, we're probably looking at 2023, before there is a real decision to be made there. We still have a keen interest in taking - casino when there were no casino and time to tell what ultimately gets invested there and how we partner that up, but we remain excited by that, obviously given location and scale, it's kind of hard not to be. We'll watch Georgia and Texas over time with interest, but again those are long-term deals. They both require I believe a referendum, I know Texas does. And so that's not going to happen overnight. And so, I think domestically we're going to try to push for Ohio in the context of a casino, but that'll be time again, so there's nothing immediate down the horizon in terms of real development. I think the only way to think about development for the near term is the Japan discussion we just had.

Thanks, Bill. And then changing subjects a little bit with CityCenter coming entirely into the fold? Is there anything that you would do or could do differently from an operational perspective, now that you have 100% ownership, any advantages that we should be thinking about?

This is Corey, John, we've ran it like we've owned a 100% of it, but we do think there are opportunities, how we synergize with Bellagio for example, Vdara is right - is closer to the Bellagio Convention Center as it is to Aria. And we think there is some other additional operational efficiencies that could be gained owning a 100% of it, but we're pretty excited about finally getting our hands on it.

I'd also just add one comment that I'm excited about consolidating this fantastic.

Hope by the way.

Our Las Vegas EBITDAR would have been 30% higher this quarter, had we consolidated CityCenter, which - it’s a phenomenal business, which outperforms our citywide averages on virtually every dimension. So I'm enthusiastic about having it be consolidated into our financial results.

And what it gave us a 41% margin for the quarter.

Right, yes.

Great, it's been a long time coming, congratulations on that and everything else.

Thank you. That was not easy one.

And the next question will be from Barry Jonas with Truist Securities. Please go ahead.

Thank you. I think it's clear the goal is to be more efficient on the cost side versus 2019 or pre-COVID levels. But do you think the revenue mix of gaming in Vegas could be structurally higher as well or I guess are there any more recent top line trends, you would expect to sustain going forward?

Look, I'd love to think that the movement we've made pushing regional customers, we've watched for too long frankly with great interest with our colleagues next door have been doing, our market mix is half of theirs. We know we can increase that. So we think that's sustaining. Obviously, what we have done best historically is high-end international business. We're well positioned. We have a plant in Macau obviously we have regional offices all over Asia. I would like to see us get back into that business. I think there's some real growth there. And I think interestingly the demographic has changed to a younger audience and they've gotten more acclimated to gaming. We've seen it throughout this past year, a lot of these numbers remember - the older folks like myself have generally stayed away for health concerns. And I think, we've seen the emergence if you will, of another marketplace it's called millennial that we haven't seen for a while. So, we're all pretty excited about driving that in some of the platform technology things we talked about earlier with M-life we think will be meaningful in that regard.

And what I would say is, I think we have our cost pretty locked in. Obviously, there is always opportunities, now it is a revenue discussion and how we continue to maximize that and how we can grow organically higher than what we're seeing in cost of living, I think some of the digital initiatives, we're working on that, the mix will help that. As Bill mentioned, their customer base were up over 50% M-life customers in that group. And if we could figure out how to capture them and we believe we have ways to do that and keep them in the properties, we think there is opportunity for revenue lift.

Got it. And then, just curious there is strong commentary on slot play levels, which is interesting given the commentary on a younger player base, but how are you thinking about slot CapEx investment going forward?

Yes, we're looking at it right now and we're looking at our floors. We actually what we did during COVID and since we've opened, we've right-sized our floors. And we've actually laid them out, you'll PODs, you'll see better vision, better excitement. We think there's also opportunities in pockets to increase our capital spend with some decent ROIs and we're looking at that right now.

Great, thanks so much.

Last question please, Chad.

And that question will come from Robin Farley with UBS. Please go ahead.

Great, thank you for fitting it in. I just wanted to circle back to the tremendous proceeds that you're getting, because I know you've talked about your balance sheet and all of that. But it doesn't seem like you would need it for any liquidity, it doesn't seem like you'd need for any projects near term. So I'm just wondering is there any sort of tax reason that you couldn't do a special dividend or is there a consideration there? And you use the phrase, kind of, I think if I heard it right, looks for inorganic opportunities. So is - that's a pretty sizable budget in terms of looking for, I assume that means potential M&A. And so, I don't know if you can characterize kind of where you see the portfolio having gaps to fill or what kind of thing might be of interest to you? Thanks.

Thanks, Robin. I'll offer a - few thoughts and then turn it over to Bill. There is really no tax reason why we could not deploy that capital as a dividend to our shareholders or for returning capital to shareholders through other means and in fact that remains a priority for us. It is their capital that represents in a broad terms, I think about it as releasing capital from the real estate in this business, bringing it up for other uses including returning to shareholders. My comment about the inorganic opportunities, I'm sure that can be development, can be M&A and it's really in recognition that it's a very dynamic environment and market with some interesting things going on. And so, we really like our position having this kind of liquidity available to seize on those, but I'll turn it over to Bill.

Yes, but I want to remember - remind I should say, look we talked about focus, we talked about discipline, and we've talked about our vision being a gaming company at foremost. And so, look, we're gaming and entertainment might intersect themselves will be there, where digital will be there. We have some reinvestments back in our properties. We think that's important over the next couple of years, in terms of room remodels and some other things, I don't know, we'll go too far afield, I don't think that's probably in our best interest or our shareholders. So I think you'll see us disciplined and very focused on the idea of driving this whole omnichannel into a different and better place, as we think about the next decade or so.

Maybe just one clarifying question just since a large Vegas asset came up for sale earlier this year? Is it fair to conclude that maybe MGM doesn't necessarily see a benefit in like growing its Vegas presence or I mean, it seems like any property you acquire there will be a tremendous amount of synergy, just given the scale you have there. But is it fair to assume from sort of how - how things have played out this year that that wouldn't necessarily be an area that you want to grow your presence?

Robin, I don't think we're going to comment right now. I appreciate the question, but I think - we're not going to comment right now.

Okay all right. Thank you.

Thanks.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Bill Hornbuckle for any closing remarks.

Yes, thank you Chad. And I'll be quick, since this is going a little bit over. Again, I just want to call out and thank our team both universally and specific the deal teams that got us through this quarter with this tremendous pace. We're coming off an amazing quarter, July is even more so. So I know what we have put in play is trackable, is doable, and sustainable. And so, we're very excited by that. Labor and supply chain remain an issue for our company, as it does the industry, but we've also learned a lot from that, by not having some things that easily accessible to us, we figured out different and potentially better ways to do things. And so those learnings aren't going to go away. We're going to remain vigilant and keep the pressure on with COVID, particular as it relates to our employees and making sure we get them vaccinated. We're making good headway over the last 30 days and continue to push on that aggressively. We look forward to our group business returning in the back half of the year and have no reason to believe at this date that it won't with some velocity. BetMGM continues to shine and there's no reason to believe that second half of this year is not going to do the same. And as we've all talked about, we have this tremendous liquidity position we're now looking at and so the future is bright and the opportunities I think extensive. But again, we're going to be patient and disciplined about what we do and when we do it so, having said that, I appreciate everyone's attendance and thank you all.

And thank you, sir. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.