WEBVTT - Mohegan President and CEO Ray Pineault Talks Casino Environment

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<v Speaker 1>Bloomberg Audio Studios, podcasts.

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<v Speaker 2>Radio news as a continue our coverage right now of

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<v Speaker 2>live events, and who better than talk to than the

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<v Speaker 2>man behind Mohegan of course as the big casino company,

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<v Speaker 2>and of course they run a lot of big events

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<v Speaker 2>as well, including the w NBA's son CEO and President

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<v Speaker 2>Ray Pineau joining us right now around the desk here

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<v Speaker 2>in Studio two. Great to have you here.

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<v Speaker 3>Thank you for having me. I really appreciate you giving

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<v Speaker 3>me the time to be here with you.

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<v Speaker 2>Let's talk about that discretionary spend because of course we

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<v Speaker 2>know the casino environment which really encompasses a lot more

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<v Speaker 2>than gambling, as of course you know, of course, it's concerts, basketball,

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<v Speaker 2>a lot of other things. There are you still seeing

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<v Speaker 2>pretty healthy appetite for that stuff.

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<v Speaker 3>You know, Listen, when we came out of the COVID period, obviously,

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<v Speaker 3>you know, resort operations had a significant spike. I think

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<v Speaker 3>we're seeing more of a normalization now and a return

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<v Speaker 3>to normalcy, which I'm okay with because it's nice, steady growth.

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<v Speaker 3>Then there's no unexpected ups and down, so I'm hoping

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<v Speaker 3>that we can avoid that for a while. But I'm

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<v Speaker 3>pretty happy with what we're seeing at the performance at

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<v Speaker 3>our properties and you know, continuing to evolve and meet

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<v Speaker 3>our guest needs. And I think we continue to do that,

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<v Speaker 3>and I think that you get acceptance from your guests

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<v Speaker 3>when you're able to provide them.

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<v Speaker 2>Have you noticed any shift in spending. We've talked a

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<v Speaker 2>lot about how the consumer might be hurt by inflation

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<v Speaker 2>and other things. Are they spending less when they come

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<v Speaker 2>to your resorts or is it about the same.

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<v Speaker 3>What are you seeing so over the last you know,

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<v Speaker 3>six to nine months, it's about the same. I think

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<v Speaker 3>that we had a spiked period in there for about

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<v Speaker 3>a year and a half to two years where you know,

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<v Speaker 3>there was extra money in the economy and people had

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<v Speaker 3>extra money in their savings accounts, so it kind of

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<v Speaker 3>expiked all discretionary income spending at that point in time.

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<v Speaker 3>And now it's cooled off and it's about the same.

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<v Speaker 3>We're hoping to see, you know, a nice steady two

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<v Speaker 3>to three percent growth. We're in you know, what I

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<v Speaker 3>would consider mature markets. They've been around for a long time. Well,

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<v Speaker 3>he can sign our flagship in Connecticut has been open

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<v Speaker 3>over twenty eight years now, so you know, it's kind

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<v Speaker 3>of in a steady state now, and what we need

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<v Speaker 3>to do is continue to evolve and grow and bring

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<v Speaker 3>new products to our guests, to continue to encourage their

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<v Speaker 3>or discritioninatory spending a movie's on and our properties.

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<v Speaker 1>Right, that's part of the description of things normalizing that

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<v Speaker 1>you fall back on the strength of your brand, of

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<v Speaker 1>your reputation and what you offer to your customers. Mohican

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<v Speaker 1>some one of the most prominent Native American owned businesses

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<v Speaker 1>in the world. You're in Connecticut, New Jersey, Pennsylvania, and

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<v Speaker 1>Canada in the Niagara region. What do you understand about

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<v Speaker 1>those specific markets better than bigger competitors like Las Vegas.

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<v Speaker 1>Sands are an MGM.

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<v Speaker 3>Listen, I think it's a very competitive environment where we're

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<v Speaker 3>talking about Sands or win or Caesars, right, those hard

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<v Speaker 3>rock you know, all big competitors for us. But you know,

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<v Speaker 3>we fall back on our culture and our brand and

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<v Speaker 3>who we are. We never sacrifice who we are, and

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<v Speaker 3>we talk about our culture and making sure that it's

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<v Speaker 3>a team and family environment. We talk about our team

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<v Speaker 3>as our team. We're all in this together and we

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<v Speaker 3>walk about this together. And what's important to us is

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<v Speaker 3>making sure we bring our culture to wherever we go.

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<v Speaker 3>But as we're going into these new jurisdictions, we're also

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<v Speaker 3>mindful of the jurisdictions we're going into. We have to

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<v Speaker 3>be mindful of their culture. We have to be mindful

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<v Speaker 3>of the way that they do business while bringing our

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<v Speaker 3>culture there and being mindful of that.

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<v Speaker 1>Okay, So one of the jurisdictions you're looking to enter

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<v Speaker 1>is New York City. What is the latest on your

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<v Speaker 1>pitch to win a downstate casino license?

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<v Speaker 3>So obviously it's a crowded field in New York City.

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<v Speaker 3>You know, we have a pretty definitive timeline. We think

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<v Speaker 3>right now that the city that the state has laid

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<v Speaker 3>out for the bidding process, We've been working diligently on

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<v Speaker 3>putting our response into the RFA and we know that

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<v Speaker 3>we'll have that ready come June time when we think

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<v Speaker 3>they're going to call for the r phase. We have

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<v Speaker 3>the largest undeveloped land in New York City. It's almost

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<v Speaker 3>seven acres right off the FDR Drive. Tremendous access when

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<v Speaker 3>you think about the ease of access of getting to

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<v Speaker 3>this piece of property, and you know, we've been in

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<v Speaker 3>the New England region for twenty eight years. We know

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<v Speaker 3>the consumer. We know what they're looking for. We know

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<v Speaker 3>how to appeal to the New England guests. That's where

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<v Speaker 3>our flag is started, that's where we're from. So we

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<v Speaker 3>understand the New York market. We understand this entire region,

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<v Speaker 3>and I think that we have a very competitive presentation

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<v Speaker 3>to put forward to the state.

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<v Speaker 2>It's interesting you bring up the location on the FDR.

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<v Speaker 2>I don't want to make this too hyper local, but

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<v Speaker 2>as you know, some of the competing bids, of course,

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<v Speaker 2>are more focused on the West Side, and that seems

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<v Speaker 2>to be at least from what we heard from this administration,

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<v Speaker 2>the Adam's administration a few months ago, that they were

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<v Speaker 2>leaning a little bit more towards that part of the city.

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<v Speaker 2>Are you worried at all that that might actually undercut you?

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<v Speaker 3>It's going to be a competitive process from there, right,

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<v Speaker 3>I mean, I don't think there's any given in any

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<v Speaker 3>of this is at least ten, twelve, fourteen competitors that

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<v Speaker 3>are going to be going for and they're all formidable competitors.

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<v Speaker 3>So I don't want to diminish anything that anybody else

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<v Speaker 3>is doing. What we're going to do is put the best,

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<v Speaker 3>best product forward that we possibly can. We believe we

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<v Speaker 3>have a very compelling project that is going to rank

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<v Speaker 3>with the best of any of them, and we're going

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<v Speaker 3>to provide not only that, but we're also going to

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<v Speaker 3>provide the city with affordable housing and a museum along

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<v Speaker 3>with park space, things that are badly and sorely needed

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<v Speaker 3>in New York City. So we think we have a

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<v Speaker 3>compelling project. What ultimately happens is we're going to put

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<v Speaker 3>our best foot forward. We believe that we're we're the

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<v Speaker 3>best project for New York City. But ultimately, you know,

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<v Speaker 3>all we can do is put our best foot forward

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<v Speaker 3>and then let the process play itself out.

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<v Speaker 1>All right, Speaking of experision, you also recently open a

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<v Speaker 1>five bo million dollars integrated resort called Inspire in Seoul,

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<v Speaker 1>South Korea. The casino will be a small part of

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<v Speaker 1>the project, which matters because according to Korean law, only

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<v Speaker 1>non citizens can legally gamble. So what do you anticipate

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<v Speaker 1>the breakdown to be? Will it be like eighty percent

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<v Speaker 1>non gaming, twenty percent gaming, or more like fifty to fifty.

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<v Speaker 3>So right now we're targeting more of a fifty to

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<v Speaker 3>fifty break. It is much smaller casino. When you think

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<v Speaker 3>about us casinos where US resorts, I should say not casinos,

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<v Speaker 3>the casino is a larger portion of the overall footprint.

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<v Speaker 3>That is not true in an Inchhon where we are,

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<v Speaker 3>it's a much smaller footprint. In fact, the number of

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<v Speaker 3>slot machines that they have there is only about one

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<v Speaker 3>fifth of what we have in Connecticut, but the number

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<v Speaker 3>of table games is about the same, if not a

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<v Speaker 3>little bit more. In the in the Asian region, they're

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<v Speaker 3>much heavier cable games players than they are slot players.

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<v Speaker 3>But we're also banking on all the amenities that we're

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<v Speaker 3>bringing there. So when you think about all a dining,

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<v Speaker 3>all a shopping, we have a water park that's there.

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<v Speaker 3>We have a fifteen thousand seat arena, we have twelve

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<v Speaker 3>undred hotel rooms. We obviously have our spa, we have

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<v Speaker 3>a convention center.

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<v Speaker 1>So it's not just.

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<v Speaker 3>Relying on the gaming aspect of it. Because as you

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<v Speaker 3>pointed out, Scarlett, this is a foreigners only casino. We're

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<v Speaker 3>also tracting this twenty five million people that live in

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<v Speaker 3>the Greater Inchon Sooul area that we're bringing out for

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<v Speaker 3>all the other amenities, including the outside park that we

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<v Speaker 3>have that people can come and enjoy.

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<v Speaker 2>Just real quickly, and we only have about about thirty

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<v Speaker 2>seconds left. But I do want to circle back to

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<v Speaker 2>your property in Connecticut and specifically with the Sun the

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<v Speaker 2>women's professional basketball teams. I'm sure you know Boston wants

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<v Speaker 2>your team. Are you going to give it to them?

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<v Speaker 3>Yeah?

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<v Speaker 2>Say they say it should be the Boston You know.

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<v Speaker 3>The interesting thing is it's a great partnership. We've actually

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<v Speaker 3>had a game in Boston. Yeah. I don't know if

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<v Speaker 3>people who are familiar with that.

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<v Speaker 2>And we sold out t D Garden. Yeah, and that's

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<v Speaker 2>why they say in this you move ahead.

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<v Speaker 3>Well, you know what, we sell out. We've sell off.

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<v Speaker 3>We've sell out the muhigan Son Arena and they do

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<v Speaker 3>a fantastic job and we were very fortunate Caitlin Clark's

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<v Speaker 3>first professional basketball again, is that Mohigan song?

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<v Speaker 2>Yes, we did all we all watched.

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<v Speaker 1>Yeah, and I'll stay in mohgan Son. I'm sorry, Gray,

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<v Speaker 1>thank you so much for joining us today. Ray pano

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<v Speaker 1>is MAHOI again, President and CEO, appreciate it. Thanks for

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<v Speaker 1>having me