Good afternoon, and welcome to the MGM Resorts International First Quarter 2019 Earnings Conference Call. Joining the call from the Company today are Jim Murren, Chairman and Chief executive Officer; Corey Sanders, Chief Financial Officer; Bill Hornbuckle, President and Chief Operating Officer; Grant Bowie, CEO and Executive Director of MGM China Holdings Limited. Participants are on 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 Catherine Park. Please go ahead.

Thanks Chad, and good afternoon and welcome to the MGM Resorts International's first quarter 2019 earnings call. This call is being broadcast live on the Internet at investors.mgmresorts.com and we've also furnished our press release on Form 8-K to the SEC. On this call, we'll 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 materially 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 a reconciliation to the GAAP financial measures in our press release. Also, during today's call, we'll be reviewing slides 14 to 18 of our earnings presentation deck which is available on our website. Finally, this presentation is being recorded. I'll now turn it over to Jim Murren.

Well, thank you, Kathy, and good afternoon, everyone. We had a very busy and productive quarter here at MGM with a lot of changes happening all with an eye to the future. As you all remember, we announced MGM 2020 back in January and we've been executing on that plan over the past few months. We've made changes to our leadership, announced the addition of a pioneering new digital leader who will oversee growth and revenue, and we are progressing with Phase 1 of MGM 2020, which is expected to deliver $200 million of EBITDA in 2020. This is a time of meaningful transition. We're laying the foundation for a strong future and making a lot of changes that will have a significant impact on how we operate. Corey will discuss 2020 in further detail in a bit. But first, a few key points I'd like to make. The first quarter came in slightly better than our expectations with consolidated net revenues up by 13% and adjusted EBITDA up 5%. The last time we were together we highlighted both low hold and a tough comp in our Las Vegas Baccarat business. This was the primary driver of our year-over-year Strip EBITDA decline in the quarter, and clearly something that the market felt as a whole with Las Vegas Baccarat DGR down 32% year-over-year. Our U.S. Regional properties showed tremendous strength and we are starting to see the fruits of our labor in Macau which had a nice quarter with a continued ramp-up of MGM Cotai. I want to first say right up front that there is no change in our full-year outlook. We expect a strong second half to the year as we begin to drive financial benefits from 2020 as well as a good convention calendar. And lastly, our…

Thanks Jim. And if I could turn people's attention to slides 14 through 18 in the earnings deck that has been posted on our website. Starting on Slide 14, we have been working on MGM 2020 for over a year now. When we announced the plan back in January, we set out to create a company that is streamlined and nimble and one that empowers leaders. In order to unleash innovation and support dynamic new ideas, we needed a new way of operating. MGM 2020 is an evolution of our continuous improvement journey which began with the profit growth plan in 2015, now as you know is very successful, we targeted EBITDA enhancements of $300 million and ended up around $500 million. Between PGP and the announcement of MGM 2020, we have been busy standing up key centralized functions, redefining our service standards, training our employees on these standards, and opening four properties. Through PGP, we laid the foundation for MGM 2020 as we installed the more centralized operating model which focused primarily on creating and sharing best practices across the enterprise. We also established our project management office. MGM 2020 has two phases. Phase 1 of MGM 2020 is about scaling the centralized operating model to improve operational efficiency and effectiveness. We are moving certain key functions out of the properties and into corporate centralized groups called centers of excellence. Phase 2 of MGM 2020 is about driving a customer-centric strategy to accelerate revenue growth. This will be accomplished through better leveraging digital technology and capabilities plus an enhanced loyalty program. We will talk more in detail about Phase 2 in upcoming months. Turning to Slide 52, this is a - 15, I'm sorry - this is an earnings call. So let's talk about some numbers. For Phase 1…

Thanks Corey. As you've heard, we're committed to our long-term growth strategy and we're fully on track to achieve our stated goals of $3.6 billion to $3.9 billion in consolidated adjusted EBITDA by year-end 2020. Remainder of the key drivers remain the ramp-up of the open properties and the program Corey's talking about, MGM 2020. We're also targeting free cash flow per share, as I said, of $3.50. We have dramatically, as you know, reduced our overall CapEx spend as all our major development projects are behind us. Our properties are all in excellent shape with no deferred CapEx. We will continue to be focused on fortifying our balance sheet. Earlier this month, we raised a $1 billion in senior notes at a very attractive rate and use the proceeds to address our near-term maturities. We remain confident in our goal to get our consolidated net leverage to 3 times to 4 times by year-end 2020. We did not buy stock in the quarter as we were focused on our debt issuance, the bond tenders, and funding our previously announced acquisitions. But our capital allocation strategy has not changed. We have a $1.4 billion remaining authorization of our share repurchase and we intend to use it over time. As always, we're excited about the opportunities in Japan, in sports, and in the digital space. And to that end, we recently hired Atif Rafiq, who will be our President of Commercial and Growth, where he will develop new customer experiences business models and revenue streams. He comes to us from Volvo where he was overseeing the research on the next generation of automobiles and he was previously responsible for the global digital transformation at McDonald's, very experienced digital leader. We're very excited to see the changes he will bring when he…

[Operator Instructions] The first question will be from Joe Greff with JPMorgan. Please go ahead.

My first question relates to the Baccarat segment in Las Vegas. How did that gaming patron and your views and outlook there compare presently to the outlook they had on February 13th when you reported fourth quarter results? As you look ahead, are there any signs to be optimistic given what we're seeing in terms of China macro and the prospects of US-China trade resolutions? And then I have a follow-up.

Joe, hi, this is Bill Hornbuckle. Good afternoon. Look, I think we're seeing some of the same signs, but I think it's important to keep it relevant. First and foremost, remembering and go back on Jim's comments, '18 was an exceptional year. Our market share as it relates to Las Vegas has not deterred, I mean in fact we're mid 40s and we lead the marketplace here, and it was tied to a handful of customers. I think as you look at the balance of the year, it's important to understand that as of the first quarter, 30% to 40% of our net baccarat revenues have been had, if you will, given the cycle of how the year works in that marketplace, and if you look at our lineup and things that we have going forward and our ability to continue to attract, they're meaningful. Of note, Jim mentioned we have - in May we have Canelo, in June we have a Tyson Fury fight, in July we have Manny Pacquiao, and we also have Paul McCartney coming in June, all things that attract the Asian business and things we think and we know can motivate folks coming here. I think the other thing to keep in broad perspective given our diversification is that the net impact of all of this is mid single digits in terms of our EBITDA. Fundamentally, the business hasn't changed. We think we're in good shape, we're market leading, we think we've got an event calendar that will be meaningful and continue to drive the business.

And Joe, this is Jim, just to answer the question, the baccarat trends are exactly what we had thought we would see when we gave you guidance in February.

And Corey, you gave us a lot of details and information on 2020. You may have said this or you may have said this and I think Catherine you may have said it in a different way, but can you give us maybe as of, I don't know, the end of March or as of now I guess maybe the kind of year-to-date the tally on labor savings where we stand now and then how do you see that cadence in the 2Q in the back half of the year?

Yes, Joe, as I mentioned, we're looking to achieve $80 million in fixed labor savings. Most of that will be done by the end of Q2 and you'll start seeing that starting to flow through in Q3 and Q4.

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

Maybe, Corey, just to stick with the same comments since you gave us so much detail on a 2020 plan, you know, as we get into this, is there - and there is some real big shuffles happening at the management levels, is there any risk of sort of near-term disruption to core operations in your view, anything that might be sort of revenue touching and then on that also we've seen some big systems implementations happen in the past and also create some dislocation out there for some companies that have gone through meaningful transitions. So anything on the systems side that investors should be aware of or could cause any disruption there?

So, Shaun, I'll answer the technology stuff and I'll team up with Bill on the operational stuff since we both have a pulse on it, but he's dealing with this real-time every day. On the technology side, we are implementing the ERP in the finance area, we have a very thoughtful plan also through our PMO office that I think will mitigate any type of transformation there. All the other technology that we're investing in I think will only enhance the customer experience and the employee's ability to service the customer. On the operational side, I'll turn it over to Bill to get his comments.

Shaun, look, I'm looking in the room. We have three new Group Presidents here with us. Between their exposure and experience, my own, we were - this weekend was the first weekend we were in this new operating mode. We are all over the business. We all went to numerous properties. We have a great deal of faith than when left alone to operate the business and service our customers at the operating levels, at the property levels, we're going to be in great shape. Obviously, change is not easy. We're going to be going through a bunch of change dynamics, but again, we've been looking at this thing since late third quarter of last - excuse me, early third quarter of last year and we've thought through a lot of the opportunities that something like this would create and we think we're really well positioned to take care of them.

And just my follow-up would just be on Park and Springfield. Jim, I think in your comments in the prepared remarks, you said that both are ramping well. Can you just give us a little bit more color on those. I mean we now have some hard numbers for both. Are these you know in line with your underwriting or are they going to ramp to your levels by the second half or when do you think will be at run rates that are consistent with what you're expecting to see there for each?

Well, I think I would point to maybe National Harbor is a good example or other new properties that we have developed. Park MGM is really a new property. It certainly probably would have been easier to build a new property. But it is a new property today and we're exceptionally proud of the execution of the delivery of the product and the quality of the product. The financial returns are tracking what we had underwritten as long as they continue to ramp which we expect that they will. Springfield's start off slower than we had predicted, but is still on the trajectory that we had also predicted. So I believe that you're going to see - we expect to see at Springfield a ramp-up along the lines from a trajectory that we saw at National Harbor. But I can turn it over to Bill if you had any more --

Maybe a little more color on Springfield to start. Obviously, it's seasonal. Northeast Corridor, particularly spring, will bring more business. It's happened throughout Connecticut and throughout the region, we anticipate that. We're in full leverage mode on entertainment, Sher, A. O. Smith, Steve Martin all come to Springfield in the near future. And so our opportunity to put programming in there to continue to expand it, we feel pretty good about, and March by far, and even if you look back on January, February, and March, March was our best month by far so far in the young history of the property. More on Park, it's beginning already to act like a luxury property, our ability to leverage rooms and particularly entertainment and food and beverage, Corey talked about yielding, but the grosses we're seeing with Gaga and Bruno are unheard of in the industry given the scale. And so we're pretty excited by what all that's going to bring us long term.

The next question comes from Harry Curtis with Instinet. Please go ahead.

First in - in Vegas, there are an awful lot of moving parts, the numbers in Vegas and it includes volumes and hold and also the charges that you've been incurring. So when you try and normalize that, how would you describe your business? Is it on an adjusted basis, do you think that the EBITDA is actually in a growth phase in 2019 or is it just going to take another two or three quarters to see that?

You want me to start and then turn over to my colleagues. Hi, Harry. I think what we saw when we talked to you on the fourth quarter is what we're seeing right now. We expect that the market will be up this year in Las Vegas and that we expect at MGM Resorts to maintain if not build our share and we can get into some of the macros around that, you get a lot of information from either the LVCVA or airlines et cetera. And Corey and Bill can speak to that more, but the overall trends on Las Vegas as a market are the same as we saw in February, and 2020 looks really outstanding, which gives us the comfort to build our book, our base of business. Bill mentioned the entertainment side, we are clearly focused on that because we know it drives a lot of business. So that is a positive trend for '19 and then into 2020 because of the Raiders coming and the other activities that are going to have a major impact on visitation. The fact that our slot in non-bac table business is growing is an important data point. That's why we highlighted that it generally does speak to the overall health of the market and the fact that we're able to quickly absorb the capacity of the MGM conference center and actually make it profitable for us also speaks to the overall tone of the market. So from a high level, we feel very constructive on Las Vegas in '19 and '20 and then maybe I'll turn it to you Corey --

And what I would say here is, you know, as Jim mentioned, the trends that we're seeing other than the baccarat trends are positive and even that the hold impact from this year to prior year was pretty significant. We were held at the higher range last year and this year we're below the midpoint. But when you look at the first half of the year, we did mention that it would be a little bit more challenging and that the back half would be positive. And with our implementation of the 2020 efforts, it even gives us that much more confidence in growing our cash flow in the back half of the year.

And then I wanted to ask a question to Grant. Grant, if you would touch on a couple of topics including the - over the last 3 months to 6 months the direction of your market share, the contribution of the Mansion. And then just the mindset of VIP, the VIP junket and premium mass customers, kind of going back to Joe's question, in Macau, are you seeing any green shoots there in their behavior?

So let's go for the first one about market share. So we've continued to increase the share. So we've added about 1%, 100 basis points in the quarter and we continue to look forward to what we saw as a more appropriate level for us. In terms of, if I can now jump to the VIP in the market, I think we need to understand that Macau is maturing into a very defined segments. So the VIP business, which is both in-house and junket, the junket is a little contracted at the moment, they went through a very big growth curve. It seems very flat and I think, as everyone says, that market looks like it's going to be down for the rest of the year. In terms of the mass business and then some of that in-house VIP business, before we opened the Mansion, we were already starting to see a positive uptick, but since we've launched the Mansion and More, and also what we call Mansion One which is the gaming area, which came on stream actually in fourth quarter, we're seeing some really positive signs and re-emergence of customers that we have not had in the property. And frankly, we hadn't overly targeted them for Cotai because until we had the Mansion and we had the products and services that we know the demand, it was somewhat inappropriate for us to invite them and very dangerous. So they are coming back in and I can give you a general indication to this week that demand for the Mansion and the property is looking very strong for the Golden Week which starts here tomorrow. So in terms of our positioning, we're seeing positive indicators, we're seeing new customers, we're seeing existing customers return. In terms of the market, I would - we would see the mass business continuing probably in that upper single digit. I think the rest of the year is going to be challenging for junkets. And I think we also need to put it in context for Macau and for China, there's a lot of issue - a lot of things going on with the 20th anniversary of Macau, there's big celebrations - a big Issue - big meetings and activities going on in China. So I'd say that at the junket end, it maybe a little challenging, but I'm very confident very positive and most importantly very positive about our product relative to the balance of the share.

The next question comes from Felicia Hendrix of Barclays. Please go ahead.

So, Jim, I know you reiterated your outlook for the full year and you gave us some things to think about for the second quarter in the deck, like you say high hold and you're going to have costs, I think it's $11 million in the second quarter. Are you - and then so you gave us that, but I'm wondering, are you facing any headwinds in terms of group business in the second quarter? I think something might have rotated out in June of this year and I know you're not giving particularly guidance, but when you look at Strip consensus EBITDA of almost $450 million in the second quarter and REVPAR of a little more than 2%, is that something you're comfortable with?

Yes, I'll answer that Felicia and we're not going to go into the REVPAR, but on the convention business in the second quarter, it's going to be a good quarter for us. We do have a tough comparison because last second quarter - last year second quarter is pretty solid. And in particular, June, we have a little bit of an impact at one of the properties, but we feel confident - comfortable where the rest of the year is and that the following year actually is even in a better place than this year.

Yes, June, we had a good convention rotate out. It happens all the time. It happened this June, but overall tone we feel good about and more importantly for the year we haven't seen any change at all year in terms of the fundamentals, they remain very strong.

And then I think it was today actually Wynn announced that they're no longer going to charge for parking fees. Wondering how you guys are thinking about that?

Hi Felicia, this is Bill. Look, we spend a lot of time, energy, money with technology, we think we have the right policy and the right program, their independent decision won't change ours going forward.

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

Bill, you mentioned earlier, you talked a little bit about I think you said 30% to 40% of the baccarat revs in the first quarter and if you just look at - if I just look at the data from the Nevada Gaming Commission, on average, if I look at the first quarter as a percentage of the year just volumes it's basically 25% to 26% over the last few years and I understand you guys have had hold benefits last year and a little bit of a hold headwind this year, but is it the expectation that that seasonality this year within the baccarat segment will be pretty similar, as that would imply you know kind of like a 15% to 20% decline Strip wide in bac obviously starting from a tough spot here from the first quarter where a lot of that that seasonality gets built up but you guys see this first quarter being emblematic of the rest of the year to any extent?

Look, I don't know that we're going to change our overall guidance for the year for sure. The first query is always the biggest quarter coming off the domestic New Years and Chinese New Year's. Our programming, although exciting, I mean, we've consistently had major events going forward, you know, hoping Pacquiao's fight data somebody we all know and love, could change the dynamic, but short of that, we think it's going to fall in line with the rest of history.

And then just one more if I could follow-up on that. Of the $35 million you guys called out the year-over-year negative EBITDA headwind from the baccarat shortfalls, how much of that do you think stems from just maybe the higher end being a little bit softer relative to the confluence of New Years, Chinese New Years and the Super Bowl dates being less favorable in '19 relative to '18?

You know, Carlo, as usual, that's half a dozen customers give or take. As you mentioned, Super Bowl last year was 12 days apart. This year, it was literally two. So the two events fell on top of each other. So that had a lot to do with it. Obviously, looking forward, we think we can continue to drive the kinds of activity we always have. Our marketing groups are as strong as they've ever been in terms of people and positioning. I think Grant's growth and market share there has always been to our benefit here in Las Vegas. We've taken our marketing troops and implemented them more fully into like we've done here in Las Vegas into the Macau environment. And so you know we hope to, A, control our own market share which is you know again in the mid 40s and be continue forward progressively.

The next question comes from Thomas Allen with Morgan Stanley.

Question for Grant. Your mass market hold increased pretty considerably and that mirrors one of your peers when they reported last week. Anything changing fundamentally with mass market hold?

No. But other than - other than it seems to be moving up and it's staying there, which is a positive thing which I think recognizes sort of a broadening and maturation of the market. Obviously, when you start bringing new customers and broadening the base, you seem to see the hold move forward and we're seeing that as a sort of almost like a market trend and holds in Cotai in particular in mass do seem to be a little bit higher. So I think that's just a coincidence of the market and I think it's a positive thing that we're seeing as we move forward.

And then just on Japan, the RFC for soccer was launched last week. Any updated thoughts on timing and then potential spend there? Thank you.

This is Bill again. So obviously, they've issued it. It will be due in late August. They don't give a specific date. It's open for questions, then over the next couple of weeks, it is a full - they call it RFC but the (technical difficulty)

This is the Operator. Apparently we have a technical difficulty with our speaker's location, one moment please, stay on the line. Once again, please stay connected. We'll reconnect our presenters here in just one moment. Thank you very much. Thank you. I have reconnected our presenters' location for the call. Thank you very much.

Hi, everyone. Apologies for that, we're in the middle of a huge thunderstorm here and it looks like we were dropped, but we're back on now.

Next question operator.

Next question will be from Stephen Grambling with Goldman Sachs. Please go ahead.

I guess just one broader question, then I'll have a more specific question. But turning to sports betting as one of your target opportunities, can you talk about the trends you've seen in New Jersey and I think you even alluded to Mississippi. How should we anticipate your share evolving in these markets and maybe how the initial trajectories in these markets instruct your thoughts on future markets and strategy?

This is Bill. So look, overall, we're really excited where we are, the GVC platform is just coming into play. We've now put the stadium which is their primary product in Borgata. We are finalizing and we'll open with permanent retail outlets in time for football in New Jersey and in Mississippi, in both those locations. And we've gotten through some of our earlier challenges around getting our mobile apps up. So I intend that we will gain share. We are obviously in this for the long haul. We have a massive partner with GVC. Obviously, our networks with all of the leagues have been and will continue to be very productive force in the long run. And then the interesting thing is, if you looked at Beau and Tunica's results, I think EBITDA in Beau is up 17% and Tunica was up 38% and a goodly portion of that was driven solely by people coming in for sporting events and then the general activity cases around that. So we see significant upside not only in retail but ultimately in mobile. The other affirmative thing is - and look I don't want to jinx this here, but it looks like Mass, Ohio and Michigan are all strong movers for 19 legislation and we like where those bills stand in terms of our ability to exercise on them and get full benefit from them. So overall we're fairly - we're very optimistic. We recognize on mobile in New Jersey even though we got off to a slow start, but I promise you, we will catch steam in a hurry here.

And as an unrelated follow-up, Mandalay Bay revenue looked like it was down year-over-year on what seemed like an easier comparison. How much of that would you attribute to hold versus convention calendar or other factors that we should keep in mind?

I can attribute it to the convention calendar. I think we've struggled with a particular group compared to year-over-year, but again, it's cyclical. I think overall Mandalay continues to heal. I'd say you know we're about 90% where we want to be, and we like where we're going, we're pushing forward. And remember, I think the real catalyst for change there is the Raiders. When that opens next August of 2020, the programming is going to change that whole south end of the Strip. It's literally in our backyard overharvesting end and it's a pedestrian walkway that will be converted Game Day and Event Day. And so we think it'll be substantive for the property.

Our next question comes from John DeCree with Union Gaming. Please go ahead.

Two quick ones for me maybe to start for Jim or Grant. Jim, I think in your prepared remarks, you've talked about maybe tweaking the offering at Cotai and you mentioned an opportunity to maybe add 50 or 60 suites. Is there a more formal thought process there and given some of the demand dynamics in Macau, I mean how quick could you get rooms online? And is that - is that's something you're thinking about now that the Mansions and some of the VIP products are online?

Yes, I think I'll turn it over to Grant on the ground there and I can add to it.

I think as many of you know we actually held back setting up the top tier of the south tower and that's what the white box is. We're actually in the planning phases where we're appointing architects. It'll probably take us into the end of next year, it's probably 15-month to 16-month, 18 months, 17 months buildout. The critical point for us was to work out exactly what we wanted. And as you hear today, we've clearly defined as to the suite product and that's just working through it. And then on the notion of product and tailoring product, whenever you open a new property, we always know that we do our best to get it right, but we always work out if things have changed during the buildout phase. But our focus is to bring in more food and beverage. And we're working through that process. We're starting work on our another dining space straight after the holiday in the casino space and we're now seeking out and locking down a series of new food and beverage concepts, not large, hopefully smaller. And at the same time, as part of the activation spectacle, we're looking for even pop-up solutions that we can do so simply to animate and develop. And for someone like yourselves in Union Gaming, very focused on the Macau market, you understand that all the properties are now looking at lots of new initiatives, particularly in the food and beverage space. So that's really our focus over the next few months. Jim, anything you want to add.

Yes, I would just add Grant that what you've told me several times and how constructive and bullish we are on the market itself and how we've been frustrated at MGM that we haven't been able to deliver the entire suite of products that people expect of us, particularly in the high end. Now with the Mansion open, the Mansion villas as well as the gaming areas, we feel like it's - now we're finally on our footing that we can really grow some significant share in a very strong market. So it's important to us in Asia as of course is our efforts in Japan and I think somebody - we've got cut off on Carlos when we were talking about Japan. Can I turn over to you Bill for a second?

I don't know if it was Carlos or Tom, but just to reiterate, the RFC has come out. We have sometime in August. They haven't been exactly definitive for when the RFC is done - due in Osaka. It's robust. It is extensive and it feels like an RFP which I think plays to our favor between ourselves and our partner in ORIX. We've literally spent a half a dozen years on the ground there and we're going to be ready for this thing with a great deal of velocity and programming. But from there, we hope by next spring to be in full-on RFP process with the national government and look forward from there.

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

Thank you for fitting another one in. I know you commented on your M&A strategy or I'm sorry that your growth strategy doesn't depend on M&A and obviously I think you've talked before about how properties with a lot of regional exposure don't make sense, but can you comment on, would a single asset - a single property asset in Vegas makes sense in your portfolio given all the tremendous synergies it seems like it would have especially that what you're doing this year in terms of furthering that. So any comment on that? And then I was just going to as a follow-up also ask about what convention mix you expect in 2019 because you probably have most of it on the books at this point itself. Can you handle all that? Thanks.

Sure Robin. So the standard answer is not to comment on M&A, but a couple of thoughts on your question. I think that something is happening in Las Vegas right now, it's very exciting, very good for the home team. There's a tremendous amount of interest in Las Vegas real estate, both non-gaming and gaming real estate and certainly there's a tremendous interest in a luxury property that is being marketed for sale right now. What that is doing is bringing a lot of attention both in terms of operators and in terms of real estate owners and investors to Las Vegas to look at the Valley and of course we own about half of the Valley and so it's good for us from the standpoint of having some good discussions and it'll be interesting to watch what plays out. There hasn't been a significant transaction in about a decade on the Strip. So we love what we own and operate. We look at things all the time. However, as I said, you know we are very focused on what we do have. And I think we can execute and we'll over deliver on our 2020 plans and our free cash flow with the team we have in place and the properties we have. So I would say it's topical. It's valuable. It's actually positive for MGM that there's interest in Las Vegas as a market. But our focus is on executing on these plans because this is within our control. We've done this before with PGP. We're confident that we can do it here. We've got the right team to do it. And if we over deliver on our expectations here, that's the simplest way, the clearest way of increasing shareholder value and we're not going to let anything detract, distract us from that. You had another question, Robin?.

On the convention mix.

Convention, who's going to tackle that.

I have in front of me if I did. Robin, we think it just north of 18%.

And then I imagine you expect that would go up next year just with [ConAg] rotating back in?

It arguably it should, yes.

And in closing, I just want to thank you all, sorry for that brief drop off with a rare thunderstorm here in Las Vegas we didn't expect, but we're very confident of the Las Vegas market both in terms of this year and moving forward. I hope you can firmly grasp that the baccarat issue is we believe an isolated event, not permanent in nature. We've been around a long time. We've seen this movie before. We have no change in the outlook. We talked about this in February, here we are in April, and we feel very confident on our full-year outlook and what's going to happen in the second half. We're well under way, a lot of progress has been made on the 2020 plan. A lot of momentum has been developed and we're confident that we're going to hit our targets. And I can't emphasize enough our long-term strategy and the goals that are unchanged, the 2020 targets, winning in Japan, dominating in sports betting and continue to allocate capital in a disciplined fashion, now that our major development cycle is behind us and our annual CapEx number is highly known to us which would yield significant and growing free cash flow, which we'll use the way we've described. And with that, I want to thank you all for joining us. And as always, reach out with any questions that you may have.

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