MGM MIRAGE Reports First Quarter Results

April 17, 2002
PRNewswire-FirstCall
LAS VEGAS

MGM MIRAGE (NYSE: MGG) today reported first quarter diluted earnings per share of 51 cents on net income of $82 million, compared with 52 cents per diluted share on net income of $83.9 million in the 2001 first quarter. Diluted earnings per share before preopening expenses and extraordinary items was 52 cents in the 2002 first quarter, compared with 53 cents per diluted share in the 2001 quarter. Net income before preopening expenses and extraordinary items during the 2002 quarter was $83.4 million, compared with $85.2 million in the prior year's quarter.

Net revenue was down 4% to $1.02 billion in the 2002 quarter, versus $1.07 billion in the comparable 2001 quarter. For the three months ended March 31, 2002, operating cash flow ("EBITDA") was $324.1 million when compared with $343.6 million in the prior year's quarter. The Company recorded a 31.7% EBITDA margin in the 2002 first quarter, down slightly from 32.1% in the 2001 quarter.

The 2002 first quarter results significantly exceeded the Company's 2001 fourth quarter. Room revenue continued to show sequential improvement as hotel occupancy rebounded to 89.7% in the 2002 quarter from 82.7% achieved in the 2001 fourth quarter, albeit lower than 91.4% recorded in the 2001 first quarter. For the three months ended March 31, 2002, average daily room rate ("ADR") was $101 compared with the 2001 fourth quarter of $93 and the prior- year first quarter of $110. As a result, revenue per available room ("REVPAR") improved from the 16% year-over-year decline in the 2001 fourth quarter to a 10% year-over-year decline in the 2002 first quarter. The increase in hotel occupancy led to continued improvement in casino, food and beverage and retail revenue.

"These results reflect the ongoing improvement of the Company's Las Vegas resorts and Beau Rivage as well as the strong operating performance of MGM Grand Detroit," said MGM MIRAGE Chairman and CEO Terry Lanni. "While we are not yet at normalized operational levels at our Las Vegas resorts, this marketplace has proven itself far more resilient than most had predicted," Mr. Lanni said.

"Our first quarter results reflect our efforts to increase revenues, expand our customer base and maximize our competitive advantages as the hospitality industry sees a resurgence," said MGM MIRAGE President and CFO Jim Murren. "We expect to further broaden our business through our technology initiatives, most notably our successfully launched affinity program, Players Club. Upon full integration, Players Club will link eight properties with more than 18,000 slot machines and provide our table game and slot customers with greater incentives to enjoy our properties. Our expanding free cash flow has enabled the Company to further strengthen its balance sheet in the quarter. Including amounts repaid in April, we have reduced our outstanding debt by an additional $200 million this year," Mr. Murren said.

Las Vegas Strip Resorts

Bellagio, MGM Grand Las Vegas, The Mirage, Treasure Island, New York - New York and the Boardwalk (collectively, the "Las Vegas Strip Resorts") achieved EBITDA of $228.5 million on net revenue of $719.4 million for the three months ended March 31, 2002, versus EBITDA and net revenue of $252.2 million and $779.4 million, respectively for the 2001 first quarter. Quarterly EBITDA margin for these resorts was 31.8% for the three months ended March 31, 2002, compared with 32.4% in the prior year's quarter.

The decreases in EBITDA and net revenue during the 2002 first quarter were due to a 6% and 9% decline in casino and net non-casino revenue at the Las Vegas Strip Resorts. The decrease in casino revenue at these properties during the 2002 first quarter was attributable to lower table game and slot volumes when compared with the 2001 quarter, while combined hold percentages were normal in both periods. Net non-casino revenue was affected by lower room, food and beverage and retail revenue. Hotel occupancy at these resorts was 92.6% for the three months ended March 31, 2002, compared with 95.9% in the prior year's period. ADR continued to improve from $106 recorded in the 2001 fourth quarter to $117 in the current quarter, but was below the $128 achieved in the 2001 first quarter. REVPAR was $108 versus $123 and $92 in the 2001 first and fourth quarter, respectively. Food and beverage, entertainment and retail revenues improved throughout the 2002 first quarter from those recorded in the 2001 fourth quarter, as demand for these properties continues to improve.

Other Nevada Resorts

Primm Valley Resorts generated net revenue of $51.6 million in the 2002 quarter, up slightly from $51.2 million in the previous year's quarter, while EBITDA was $10.6 million versus $11.4 million in the 2001 period. The Golden Nugget in downtown Las Vegas posted $45 million and $8.6 million in net revenue and EBITDA, respectively, in the 2002 period, compared with net revenue of $48.4 million and EBITDA of $11.9 million in 2001. For the three months ended March 31, 2002, the Golden Nugget Laughlin recorded EBITDA of $1.9 million on net revenue of $12.4 million when compared with EBITDA of $1.5 million on net revenue $12.5 million in the prior year. Monte Carlo reported net revenue of $63.4 million and EBITDA of $21.9 million, compared with $69 million and $24.7 million, respectively, for the first quarter of 2001. The Company's 50% share of this joint venture contributed $9.2 million to operating results for the three months ended March 31, 2002.

MGM Grand Detroit

For the three months ended March 31, 2002, MGM Grand Detroit recorded a 17% and 26% increase in net revenue and EBITDA, respectively. Net revenue in the 2002 first quarter grew to $103.6 million from $88.6 million in the prior year's quarter, while EBITDA increased to $46.1 million in the 2002 period when compared with $36.6 million in the 2001 period. MGM Grand Detroit produced an impressive 45% EBITDA margin in the 2002 first quarter, up three percentage points from levels achieved in the 2001 period. These results reflect the strength of the Detroit market and the continued focus on maximizing profitability through expanding marketing programs and cost control measures.

Beau Rivage

Beau Rivage reported net revenue of $71.9 million and EBITDA of $15.5 million for the three months ended March 31, 2002, versus $68.8 million and $14.5 million, respectively, in the prior-year period. EBITDA margins improved slightly to 22%. These results were aided by a 5% increase in casino revenue due to higher slot volume partially offset by lower table game revenue as a result of a decline in table game hold. Beau Rivage also achieved a small increase in net non-casino revenue.

Other Factors Affecting Operating Results

Depreciation and amortization increased by $7.4 million to $103.4 million in the 2002 quarter. This is largely due to acceleration of depreciation related to assets at New York - New York to allow for future significant enhancements to the property's casino, restaurant and entertainment venues. Additionally, depreciation increased as a result of the April 2001 opening of The Mirage Events Center.

Net interest expense was $72.6 million during the 2002 first quarter, down $24.9 million from $97.5 million in the 2001 quarter. The decrease in interest expense is due to lower debt levels, a significant reduction in interest rates on borrowings under the Company's credit facilities and, to a lesser extent, savings associated with interest rate swaps. During the 2002 first quarter, the Company reduced its outstanding indebtedness by $151 million, bringing total debt reductions to $1.1 billion since the May 2000 acquisition of Mirage Resorts, Incorporated.

Financing Activities

Subsequent to March 31, 2002, the Company successfully amended its 364-Day Revolving Credit Facility, extending the maturity to April 4, 2003. The Company chose to reduce the overall commitment under this facility from $800 million to $600 million in light of current and near-term capital requirements and management's continued commitment to reduce outstanding indebtedness. All other terms and conditions of the 364-day facility remained the same.

The Company currently has approximately $665 million of available liquidity under its various bank credit facilities.

MGM MIRAGE is an entertainment, hotel and gaming company headquartered in Las Vegas, Nevada, which owns and/or operates through subsidiaries 19 casino properties on three continents. Its U.S. holdings include: Bellagio, the MGM Grand Hotel and Casino - The City of Entertainment, The Mirage, Treasure Island, New York - New York Hotel and Casino, the Boardwalk Hotel and Casino and 50% of Monte Carlo, all located on the Las Vegas Strip; the Golden Nugget in Downtown Las Vegas; Whiskey Pete's, Buffalo Bill's, the Primm Valley Resort and two championship golf courses at the California/Nevada state line; the exclusive Shadow Creek golf course in North Las Vegas; the Golden Nugget in Laughlin, Nevada; the Beau Rivage resort on the Mississippi Gulf Coast; and the MGM Grand Detroit Casino in Detroit, Michigan. The Company is a joint venture partner on Borgata at Renaissance Pointe, a resort under development in Atlantic City, New Jersey and also controls several development sites in the ocean-front resort community. Internationally, MGM MIRAGE owns and operates the MGM Grand Hotel and Casino in Darwin, Australia and manages casinos in Nelspruit, Witbank, Johannesburg and East London, Republic of South Africa.

For more information on MGM MIRAGE and its operating subsidiaries, visit our website at http://www.mgmmirage.com/.

Statements in this release which are not historical facts are "forward looking" statements and "safe harbor statements" under the Private Securities Litigation Reform Act of 1995 that involve risks and/or uncertainties, including risks and/or uncertainties as described in the company's public filings with the Securities and Exchange Commission.

                             MGM MIRAGE AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (in thousands)
                                     (Unaudited)

                                                      Three Months Ended
                                                    March 31,     March 31,
                                                      2002          2001
  Revenues:
      Casino                                      $  567,389    $  574,748
      Rooms                                          209,019       235,013
      Food and beverage                              187,675       191,561
      Entertainment, retail and other                155,449       163,548
      Income from unconsolidated affiliate             9,225        11,551
                                                   1,128,757     1,176,421
      Less: promotional allowances                   107,617       107,649
                                                   1,021,140     1,068,772
  Expenses:
      Casino                                         282,541       295,185
      Rooms                                           55,674        60,804
      Food and beverage                               98,197       103,733
      Entertainment, retail and other                100,977       105,283
      Provision for doubtful accounts                 12,058        14,649
      General and administrative                     147,580       145,508
      Preopening expenses and other                    2,239           875
      Depreciation and amortization                  103,373        95,943
                                                     802,639       821,980

  Operating Profit                                   218,501       246,792

  Corporate Expense                                   10,635        10,824
  Operating Income                                   207,866       235,968

  Non-Operating Income (Expense):
      Interest income                                  1,240         2,032
      Interest expense, net                          (72,597)      (97,536)
      Interest expense from unconsolidated affiliate    (277)         (817)
      Other, net                                      (2,623)       (1,145)
                                                     (74,257)      (97,466)

  Income Before Income Taxes and Extraordinary Item  133,609       138,502
      Provision for income taxes                     (51,653)      (53,830)

  Income Before Extraordinary Item                    81,956        84,672

  Extraordinary Item:
      Loss on Early Extinguishment of Debt, net           --          (778)

  Net Income                                        $ 81,956      $ 83,894

  Income Before Preopening and other and
   Extraordinary Item                               $ 83,411      $ 85,241



                             MGM MIRAGE AND SUBSIDIARIES
                              PER SHARE OF COMMON STOCK
                                     (Unaudited)

                                                       Three Months Ended
                                                     March 31,     March 31,
                                                       2002          2001
  Per Share Of Common Stock:
      Basic:
      Income Before Extraordinary Item                 $0.52         $0.54
      Extraordinary Item, net                             --         (0.01)
      Net Income Per Share                             $0.52         $0.53

      Weighted Average Shares Outstanding (000's)    158,011       159,219

      Diluted:
      Income Before Extraordinary Item                 $0.51         $0.53
      Extraordinary Item, net                             --         (0.01)
      Net Income Per Share                             $0.51         $0.52

      Weighted Average Shares Outstanding (000's)    160,152       161,320



                              MGM MIRAGE AND SUBSIDIARIES
                      SUPPLEMENTAL DATA PER SHARE OF COMMON STOCK
                                      (Unaudited)

                                                       Three Months Ended
                                                     March 31,     March 31,
                                                       2002          2001
  Per Share Of Common Stock:
      Basic:
      Income Before Preopening and other and
        Extraordinary Item                             $0.53         $0.54
      Preopening expenses and other, net               (0.01)           --
      Extraordinary Item, net                             --         (0.01)
      Net Income Per Share                             $0.52         $0.53

      Weighted Average Shares Outstanding (000's)    158,011       159,219

      Diluted:
      Income Before Preopening and other and
        Extraordinary Item                             $0.52         $0.53
      Preopening expenses and other, net               (0.01)           --
      Extraordinary Item, net                             --         (0.01)
      Net Income Per Share                             $0.51         $0.52

      Weighted Average Shares Outstanding (000's)    160,152       161,320


                         MGM MIRAGE AND SUBSIDIARIES
               SUPPLEMENTAL DATA - PROPERTY OPERATING RESULTS
                               (in thousands)

                                                      Three Months Ended
                                                    March 31,     March 31,
                                                      2002          2001
  NET REVENUES:
      Bellagio                                    $  244,448    $  260,240
      MGM Grand Las Vegas                            184,987       188,748
      The Mirage                                     144,906       169,550
      Treasure Island                                 86,601        97,366
      New York-New York                               50,322        54,418
      Primm Valley Resorts                            51,599        51,233
      Golden Nugget Las Vegas                         45,019        48,448
      Golden Nugget Laughlin                          12,381        12,467
      MGM Grand Detroit                              103,619        88,645
      Beau Rivage                                     71,902        68,813
      Income from Unconsolidated Affiliate             9,225        11,551
      Boardwalk                                        8,113         9,115
      MGM Grand Australia                              7,340         7,145
      MGM Grand South Africa                             678         1,033
                                                  $1,021,140    $1,068,772

  EBITDA:
      Bellagio                                    $   86,645    $   93,515
      MGM Grand Las Vegas                             55,361        47,996
      The Mirage                                      40,004        54,558
      Treasure Island                                 25,596        31,005
      New York-New York                               19,619        23,456
      Primm Valley Resorts                            10,576        11,395
      Golden Nugget Las Vegas                          8,602        11,868
      Golden Nugget Laughlin                           1,918         1,496
      MGM Grand Detroit                               46,126        36,597
      Beau Rivage                                     15,544        14,489
      Income from Unconsolidated Affiliate             9,225        11,551
      Boardwalk                                        1,240         1,700
      MGM Grand Australia                              2,988         2,969
      MGM Grand South Africa                             669         1,015
                                                  $  324,113    $  343,610



                             MGM MIRAGE AND SUBSIDIARIES
                        SUPPLEMENTAL STATISTICAL INFORMATION

                                                       Three Months Ended
                                                     March 31,     March 31,
                                                       2002          2001
  ROOM STATISTICS:
      Bellagio
         Occupancy %                                    95.0%         96.7%
         Average Daily Rate (ADR)                       $177          $195
         Revenue per Available Room (REVPAR)            $168          $189

      MGM Grand Las Vegas
         Occupancy %                                    90.2%         94.9%
         Average Daily Rate (ADR)                       $113          $122
         Revenue per Available Room (REVPAR)            $101          $116

      The Mirage
         Occupancy %                                    94.4%         97.1%
         Average Daily Rate (ADR)                       $122          $133
         Revenue per Available Room (REVPAR)            $115          $129

      Treasure Island
         Occupancy %                                    95.6%         95.2%
         Average Daily Rate (ADR)                        $92          $109
         Revenue per Available Room (REVPAR)             $88          $103

      New York-New York
         Occupancy %                                    95.0%         98.3%
         Average Daily Rate (ADR)                        $90           $93
         Revenue per Available Room (REVPAR)             $85           $91

      Primm Valley Resorts
         Occupancy %                                    65.6%         59.3%
         Average Daily Rate (ADR)                        $36           $39
         Revenue per Available Room (REVPAR)             $23           $23

      Golden Nugget Las Vegas
         Occupancy %                                    94.4%         98.4%
         Average Daily Rate (ADR)                        $61           $65
         Revenue per Available Room (REVPAR)             $58           $64

      Golden Nugget Laughlin
         Occupancy %                                    91.1%         96.1%
         Average Daily Rate (ADR)                        $35           $28
         Revenue per Available Room (REVPAR)             $32           $27

      Beau Rivage
         Occupancy %                                    92.5%         94.1%
         Average Daily Rate (ADR)                        $77           $72
         Revenue per Available Room (REVPAR)             $71           $68

      Boardwalk
         Occupancy %                                    75.5%         89.8%
         Average Daily Rate (ADR)                        $67           $70
         Revenue per Available Room (REVPAR)             $50           $63

      MGM Grand Australia
         Occupancy %                                    64.6%         55.0%
         Average Daily Rate (ADR)                        $58           $56
         Revenue per Available Room (REVPAR)             $37           $31



                             MGM MIRAGE AND SUBSIDIARIES
                        CONDENSED CONSOLIDATED BALANCE SHEETS
                          (in thousands, except share data)
                                     (Unaudited)

                                       ASSETS
                                                     March 31,  December 31,
                                                       2002         2001

  CURRENT ASSETS:
      Cash and cash equivalents                   $   212,273   $   208,971
      Accounts receivable, net                        136,864       144,374
      Inventories                                      83,144        78,037
      Income tax receivable                                --        12,077
      Deferred income taxes                           138,543       148,845
      Prepaid expenses and other                       67,181        69,623
            Total current assets                      638,005       661,927

  PROPERTY AND EQUIPMENT, NET                       8,843,206     8,891,645

  OTHER ASSETS:
      Investment in unconsolidated affiliates         671,661       632,949
      Goodwill, net                                   104,083       103,059
      Deposits and other assets, net                  210,029       207,863
            Total other assets                        985,773       943,871
                                                  $10,466,984   $10,497,443

                          LIABILITIES AND STOCKHOLDERS' EQUITY

  CURRENT LIABILITIES:
      Accounts payable                            $    71,662   $    75,787
      Income taxes payable                              5,315            --
      Current portion of long-term debt                10,926       168,079
      Accrued interest on long-term debt               53,830        78,938
      Other accrued liabilities                       573,367       565,106
            Total current liabilities                 715,100       887,910

  DEFERRED INCOME TAXES                             1,753,911     1,746,272
  LONG-TERM DEBT                                    5,299,726     5,295,313
  OTHER LONG-TERM OBLIGATIONS                          69,199        57,248
  STOCKHOLDERS' EQUITY:
      Common stock ($.01 par value: authorized
       300,000,000 shares, issued 165,263,520 and
       163,685,876 shares and outstanding
       158,973,820 and 157,396,176 shares)              1,653         1,637
      Capital in excess of par value                2,084,500     2,049,841
      Treasury stock, at cost
       (6,289,700 and 6,289,700 shares)              (129,399)     (129,399)
      Retained earnings                               679,727       597,771
      Other comprehensive loss                         (7,433)       (9,150)
            Total stockholders' equity              2,629,048     2,510,700
                                                  $10,466,984   $10,497,443

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SOURCE: MGM MIRAGE

Contact: Investment Community, James J. Murren, President and Chief
Financial Officer, +1-702-693-8877, or Media, Alan Feldman, Senior Vice
President, Public Affairs, +1-702-891-7147, both of MGM MIRAGE

Website: http://www.mgmmirage.com/

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