MGM MIRAGE Reports Record Second Quarter Results

July 21, 2004
PRNewswire-FirstCall
LAS VEGAS

MGM MIRAGE (NYSE: MGG) today reported its second quarter 2004 financial results. Adjusted earnings from continuing operations per diluted share ("Adjusted EPS") rose 72% to $0.74 in the second quarter of 2004 from $0.43 in the 2003 quarter. These results represent an all-time record for Adjusted EPS in the Company's history, exceeding the previous record of $0.70 set in the first quarter of this year. Current quarter results benefited from the Company's capital investment and marketing programs which are driving increased visitation and customer spending company-wide. Casino revenues grew an impressive 8% in the quarter, while hotel revenues also posted a stellar 9% increase. REVPAR (revenue per available room) increased 12% at the Company's Las Vegas Strip resorts in the quarter. Current quarter results also benefited from strong collections of casino receivables resulting in a lower bad debt provision compared to prior year, which equates to a benefit of approximately $0.04 per diluted share in the current quarter.

Adjusted EPS (and Adjusted Earnings) excludes discontinued operations, preopening and start-up expenses, restructuring costs, net property transactions and loss on early retirement of debt(1). On a GAAP (Generally Accepted Accounting Principles) basis, diluted earnings per share from continuing operations increased to $0.70 for the second quarter of 2004 from $0.36 in the 2003 quarter. GAAP diluted EPS, including the results of discontinued operations, was $0.72 in the 2004 period versus $0.35 in 2003.

"We continue to reap the rewards of our steady and targeted investments in our capital assets and enhanced marketing and technology programs for our guests," said Terry Lanni, MGM MIRAGE's Chairman and CEO. "The announced acquisition of Mandalay Resort Group accelerates our growth initiatives and will add to the ranks of our management and employee talent, enhance our portfolio of resorts, and provide additional amenities to our customers. Las Vegas is becoming one of the world's leading business and leisure travel destinations, and we believe MGM MIRAGE is uniquely positioned to benefit from that success."

                    Second Quarter Company Highlights

   *  Generated net revenues of $1.07 billion, up almost $100 million, or
      10%, over 2003;
   *  Company-wide REVPAR of $123, up 11% over prior year's quarter;
   *  Produced property-level EBITDA(2) of $384 million, up 25% over the
      2003 quarter, and an all-time record for the Company for any quarter.
      Operating income was up 52% over the prior year, to $261 million.  The
      Company's property-level EBITDA margin was 36%, the highest quarterly
      margin since the Mirage acquisition in 2000;
   *  Opened several new restaurants and entertainment venues at several
      resorts, including Cravings, the ultimate buffet dining experience at
      The Mirage; Fix, the newest restaurant at Bellagio; Isla Mexican
      Kitchen and Tequila Bar at TI, Tangerine at TI, an indoor/outdoor
      nightclub and lounge experience unlike any other in Las Vegas; and
      Shibuya and Diego at MGM Grand Las Vegas, redefining Japanese and
      Mexican cuisines in Las Vegas;
   *  Invested $165 million of capital in the Company's properties,
      including continued construction of the Bellagio expansion and the
      theatre for the new Cirque du Soleil show at the MGM Grand Las Vegas;
   *  Entered into an agreement to acquire Mandalay Resort Group for $71 per
      share, plus the assumption of debt, bringing total consideration to
      approximately $8 billion, including transaction costs.
   *  Announced a joint venture agreement with Pansy Ho Chiu-king to
      develop, build and operate a major hotel-casino resort in Macau
      S.A.R.;
   *  Launched the MGM MIRAGE Rewards Visa™ Card, with BankOne, allowing
      customers to earn exclusive privileges at MGM MIRAGE resorts when they
      use their MGM MIRAGE Rewards Visa™ Card;
   *  Repurchased 5 million shares of Company common stock for $223 million
      in the quarter.

                        Detailed Financial Results

The following table shows key financial results on a Company-wide basis for the second quarter and year to date.

                                Three months ended       Six months ended
                                     June 30,                June 30,
                                 2004      2003        2004        2003
                                             (In millions)
   Casino revenue, net        $  551.7  $  508.9  $  1,110.4  $  1,005.2
   Non-casino revenue, net       520.8     465.2     1,028.6       920.8
   Net revenue                 1,072.5     974.1     2,139.0     1,926.0
   Operating income              260.6     171.6       515.3       331.0
   Income from continuing
    operations                   101.7      54.5       198.8       103.2
   Discontinued operations,
    net                            3.0     (0.7)        11.8         1.6
   Net income                    104.7      53.8       210.6       104.8

   Property-level EBITDA(2)   $  384.0  $  306.2  $    754.5  $    593.9
   EBITDA (after corporate
    expense)(2)                  365.5     291.1       720.3       565.1
   Adjusted Earnings             106.5      66.5       208.9       124.4



Except where noted, all references in this release to operating results, including statistical information, exclude the results of Golden Nugget Las Vegas, Golden Nugget Laughlin and MGM Grand Australia and MGM MIRAGE Online for all periods presented. The results of these operations are classified as discontinued operations.

Net revenue in the second quarter increased 10% from the 2003 second quarter. This increase was due to strong casino and hotel volumes, increased room pricing and increased spending by our customers in all areas of our resorts.

Casino revenue increased by 8% in the 2004 quarter. Table games volume, including baccarat, was up 8% from the prior year's quarter, with strength in both national and international play, primarily at MGM Grand Las Vegas, where the Company held a baccarat tournament in April for its premium customers. Table games hold percentages were within a normal range for both periods and the hold percentage in 2004 was in line with the hold percentage in 2003. Company-wide slot revenue in the quarter was up 10% from 2003. Several resorts experienced double-digit increases in slot revenues, including New York-New York, The Mirage and MGM Grand Detroit.

Non-casino revenue was up 12% in the quarter. Hotel revenue was up 9%, with higher occupancy of 94% in the second quarter of 2004 versus 92% in 2003, and a higher average daily room rate ("ADR") of $131 versus $121 in 2003. As a result, revenue per available room ("REVPAR") was $123, an increase of 11% over 2003. REVPAR at the Company's Las Vegas Strip resorts was up 12% over prior year.

Food and beverage, entertainment, retail and other revenues were up 12% in the 2004 quarter. These increases resulted primarily from the increases in hotel volumes, as well as the addition of Zumanity at New York-New York and other new restaurant and entertainment amenities at our resorts.

Other revenue includes business interruption proceeds of $6 million for the Bellagio power outage. Based on information from the Company's insurance provider, this amount is a reasonable estimate of the minimum amount the Company should receive upon final settlement of the claim. Therefore, the Company expects that further recoveries may be recorded in future periods.

Consolidated EBITDA increased 26% for the quarter, reflecting the strong revenue results and operating leverage inherent with higher hotel room rates, which largely flow through to operating profit, as evidenced by an increase in EBITDA margins. The property-level EBITDA margin was 36% in 2004, up from 31% in the prior year quarter and the highest quarterly margin since the Mirage Resorts acquisition. Additionally, the Company benefited from the contribution of Borgata, which was not open in the prior-year quarter, resulting in higher income from unconsolidated affiliates. Operating income increased 52% due to the increased property-level EBITDA and lower preopening expenses in the current year.

Second quarter Adjusted Earnings increased by 60% compared to 2003 due to the increase in operating income described above. Net interest expense increased due to higher average borrowings and the cessation of interest capitalization on the Company's investment in Borgata.

For the second quarter of 2004, Adjusted Earnings excluded a net $7.5 million ($4.8 million, net of tax) of items. These items included:

   *  Preopening and start-up expenses of $1.6 million ($1.0 million, net of
      tax), primarily related to new restaurants at MGM Grand Las Vegas;
   *  Restructuring costs of $3.9 million ($2.5 million, net of tax),
      including $3.0 million for the termination of a restaurant management
      agreement at Bellagio and $0.9 million for the buyout of an operating
      lease at MGM Grand Las Vegas;
   *  Net property transactions of $2.0 million ($1.3 million, net of tax),
      including $2.8 million of demolition costs related to the theme park
      land at MGM Grand Las Vegas, in preparation for The Residences at MGM
      Grand.  Offsetting these costs were net recoveries, in excess of
      carrying amount, of $1.1 million related to equipment damaged in the
      power outage at Bellagio.

In the second quarter of 2003, items excluded in the determination of Adjusted Earnings totaled $18.5 million ($12.0 million, net of tax) and included preopening and start-up expenses of $14.9 million ($9.7 million, net of tax), primarily related to Borgata and New York-New York; minor amounts of restructuring; and property transactions, net of $3.1 million ($2.0 million, net of tax).

Income (loss) from discontinued operations includes the results of the Golden Nugget Las Vegas and Golden Nugget Laughlin resorts, MGM MIRAGE Online and MGM Grand Australia. Pretax income from discontinued operations was $5 million, including the allocation of $1 million of interest expense, in the 2004 second quarter compared to a loss of $6 million, including $3 million of allocated interest and a loss on disposal of $7 million related to MGM MIRAGE Online, in the 2003 period.

Financial Position

The Company generated significant operating cash flow in the second quarter. This cash flow was partially re-invested in the Company's resorts. Second quarter capital investments of $165 million included $73 million for the Bellagio expansion, $10 million for construction of the new theatre for Cirque du Soleil at MGM Grand Las Vegas, and other routine capital expenditures, including new restaurants at The Mirage and MGM Grand Las Vegas, and continued work on the standard room remodel project at New York-New York.

The Company also repurchased 5 million shares of its common stock for a total cost of $223 million in the second quarter, bringing year-to-date repurchases to 7.9 million shares at a total cost of $344 million, and effectively completing the Company's existing authorization. In July 2004, the Company's Board of Directors approved a new 10 million share repurchase program.

As of June 30, 2004, the Company had approximately $1.4 billion of available borrowings under its senior credit facilities.

"Our exceptional 2004 operating results have allowed us to continue to invest in our world-class resorts -- these investments are already generating strong returns and will further enhance the appeal of our resorts," said MGM MIRAGE President, CFO and Treasurer Jim Murren. "In addition, we have strengthened our balance sheet to a point where we have the lowest leverage ratio at any time since the Mirage Resorts acquisition. This strength allows us access to sufficient sources of capital to finance our announced acquisition of Mandalay while providing the financial strength to execute our long-term growth strategy," Mr. Murren said.

Outlook

"We believe the current earnings estimate consensus of 53 cents for the third quarter, as reported on First Call on July 20, 2004, is reasonable," Mr. Murren said. "This represents a 56% increase over the prior-year quarter, and takes into account our expectation for percentage REVPAR growth over prior year in the 6-8% range."

MGM MIRAGE will hold a conference call to discuss its earnings results and outlook for the third quarter at 11:00 a.m. Eastern Daylight Time today. The call can be accessed live at www.companyboardroom.com or www.mgmmirage.com, or by calling 1-800-526-8531 (domestic) or 1-706-634-6528 (international). A complete replay of the conference call will be made available at www.mgmmirage.com.

(1) Adjusted Earnings (and Adjusted EPS) is presented solely as a supplemental disclosure because management believes that it is 1) a widely used measure of performance, and 2) a principal basis for valuation of gaming companies, as this measure is considered by many to be a better measure on which to base expectations of future results than income from continuing operations computed in accordance with generally accepted accounting principles ("GAAP"). Reconciliations of GAAP income from continuing operations and EPS to Adjusted Earnings and EPS are included in the financial schedules accompanying this release.

(2) EBITDA is earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, restructuring, preopening and start-up expenses, and property transactions, net. EBITDA is presented solely as a supplemental disclosure because management believes that it is 1) a widely used measure of operating performance in the gaming industry, and 2) a principal basis for valuation of gaming companies. Management uses property- level EBITDA (EBITDA before corporate expense) as the primary measure of the Company's operating resorts' performance, including the evaluation of operating personnel. EBITDA should not be construed as an alternative to operating income or income from continuing operations, as an indicator of the Company's operating performance, or as an alternative to cash flows from operating activities, as a measure of liquidity, or as any other measure determined in accordance with generally accepted accounting principles. The Company has significant uses of cash flows, including capital expenditures, interest payments, taxes and debt principal repayments, which are not reflected in EBITDA. Also, other gaming companies that report EBITDA information may calculate EBITDA in a different manner than the Company. Reconciliations of consolidated EBITDA to income from continuing operations and operating income to EBITDA by resort are included in the financial schedules accompanying this release.

MGM MIRAGE (NYSE: MGG), one of the world's leading and most respected hotel and gaming companies, owns and operates 12 casino resorts located in Nevada, Mississippi, Michigan and Australia, and has investments in two other casino resorts in Nevada and New Jersey. The company is headquartered in Las Vegas, Nevada, and offers an unmatched collection of casino resorts with a limitless range of choices for guests. Guest satisfaction is paramount, and the company has approximately 40,000 employees committed to that result. Its portfolio of brands include AAA Five Diamond award-winner Bellagio, MGM Grand Las Vegas - The City of Entertainment, The Mirage, Treasure Island ("TI"), New York - New York, Boardwalk Hotel and Casino and 50 percent of Monte Carlo, all located on the Las Vegas Strip; Whiskey Pete's, Buffalo Bill's, Primm Valley Resort and two championship golf courses at the California/Nevada state line; the exclusive Shadow Creek golf course in North Las Vegas; Beau Rivage on the Mississippi Gulf Coast; and MGM Grand Detroit Casino in Detroit, Michigan. The Company is a 50-percent owner of Borgata, a destination casino resort at Renaissance Pointe in Atlantic City, New Jersey. Internationally, MGM MIRAGE also owns a 25 percent interest in Triangle Casino, a local casino in Bristol, United Kingdom. The Company has entered an agreement to sell MGM Grand Australia in Darwin, Australia, pending finalization. For more information about MGM MIRAGE, please visit the company's 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
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share data)
                                 (Unaudited)

                                Three Months Ended      Six Months Ended
                                June 30,   June 30,    June 30,    June 30,
                                  2004       2003        2004        2003
  Revenues:
    Casino                     $ 551,691  $ 508,944  $1,110,414  $1,005,165
    Rooms                        232,304    212,689     467,265     425,987
    Food and beverage            212,040    189,424     429,804     377,501
    Entertainment                 65,971     59,485     133,213     124,628
    Retail                        48,072     46,304      93,170      87,394
    Other                         66,015     55,008     117,101     107,357
                               1,176,093  1,071,854   2,350,967   2,128,032
    Less: Promotional
     allowances                 (103,568)   (97,737)   (212,006)   (202,041)
                               1,072,525    974,117   2,138,961   1,925,991
  Expenses:
    Casino                       269,518    251,812     547,121     513,828
    Rooms                         62,468     58,910     124,300     116,816
    Food and beverage            121,138    106,694     240,687     211,946
    Entertainment                 47,548     43,377      94,127      90,110
    Retail                        30,566     29,262      59,078      55,848
    Other                         38,328     33,284      71,212      63,769
    Provision for doubtful
     accounts                     (2,915)     6,784       3,962      14,420
    General and administrative   151,420    146,377     297,701     284,677
    Corporate expense             18,458     15,022      34,196      28,768
    Preopening and start-up
     expenses                      1,619     14,896       2,000      21,443
    Restructuring costs            3,900        548       4,314       1,153
    Property transactions, net     1,938      3,094       3,677       9,910
    Depreciation and
     amortization                 97,484    101,044     195,037     201,594
                                 841,470    811,104   1,677,412   1,614,282

  Income from unconsolidated
   affiliates                     29,542      8,547      53,714      19,336

  Operating income               260,597    171,560     515,263     331,045

  Non-operating income
   (expense):
    Interest income                1,116        734       2,019       2,442
    Interest expense, net        (92,622)   (80,181)   (182,432)   (162,979)
    Non-operating items from
     unconsolidated affiliates    (6,690)       (73)    (12,895)       (224)
    Other, net                    (2,573)    (5,561)     (9,727)     (4,793)
                                (100,769)   (85,081)   (203,035)   (165,554)

  Income from continuing
   operations before income
   taxes                         159,828     86,479     312,228     165,491
    Provision for income taxes   (58,165)   (32,023)   (113,425)    (62,259)
  Income from continuing
   operations                    101,663     54,456     198,803     103,232

  Discontinued operations
    Income (loss) from
     discontinued operations,
      including gain (loss) on
       disposal of $8,186 (six
       months 2004)
        and ($7,357) (three
         and six months 2003)      4,809     (6,321)     18,678      (1,589)
    Benefit (provision) for
     income taxes                 (1,755)     5,615      (6,916)      3,110
                                   3,054       (706)     11,762       1,521

  Net income                   $ 104,717  $  53,750  $  210,565  $  104,753

  Per share of common stock:
    Basic:
    Income from continuing
     operations                $    0.73  $    0.36  $     1.41  $     0.68
    Discontinued operations         0.02         --        0.08        0.01
    Net income per share       $    0.75  $    0.36  $     1.49  $     0.69

    Weighted average shares
     outstanding                 139,904    150,721     141,018     151,412

    Diluted:
    Income from continuing
     operations                $    0.70  $    0.36  $     1.36  $     0.67
    Discontinued operations         0.02      (0.01)       0.08        0.01
    Net income per share       $    0.72  $    0.35  $     1.44  $     0.68

    Weighted average shares
     outstanding                 144,748    153,052     145,806     153,241



                         MGM MIRAGE AND SUBSIDIARIES
          RECONCILIATION OF GAAP INCOME FROM CONTINUING OPERATIONS
                     AND EPS TO ADJUSTED EARNINGS AND EPS
                    (In thousands, except per share data)
                                 (Unaudited)

                                      Three Months Ended   Six Months Ended
                                       June 30, June 30,  June 30,  June 30,
                                         2004     2003      2004      2003
   Income from continuing operations   $101,663  $54,456  $198,803  $103,232
   Preopening and start-up expenses,
    net                                   1,052    9,683     1,300    13,938
   Restructuring costs, net               2,535      356     2,804       749
   Property transactions, net             1,260    2,011     2,390     6,442
   Loss on debt retirements, net             --       --     3,593        --
   Adjusted earnings                   $106,510  $66,506  $208,890  $124,361

   Per diluted share of common stock:
    Income from continuing operations  $  0.70   $ 0.36   $  1.36   $  0.67
    Preopening and start-up expenses,
     net                                  0.01     0.06      0.01      0.09
    Restructuring costs, net              0.02       --      0.02      0.01
    Property transactions, net            0.01     0.01      0.02      0.04
    Loss on debt retirements, net           --       --      0.02        --
    Adjusted EPS                       $  0.74   $ 0.43   $  1.43   $  0.81

    Weighted average diluted shares
     outstanding                       144,748  153,052   145,806   153,241



                         MGM MIRAGE AND SUBSIDIARIES
  RECONCILIATION OF CONSOLIDATED EBITDA TO INCOME FROM CONTINUING OPERATIONS
                                (In thousands)
                                 (Unaudited)

                                     Three Months Ended   Six Months Ended
                                      June 30,  June 30,  June 30,  June 30,
                                        2004      2003      2004      2003

  EBITDA                             $365,538  $291,142  $720,291  $565,145
    Preopening and start-up expenses   (1,619)  (14,896)   (2,000)  (21,443)
    Restructuring costs                (3,900)     (548)   (4,314)   (1,153)
    Property transactions, net         (1,938)   (3,094)   (3,677)   (9,910)
    Depreciation and amortization     (97,484) (101,044) (195,037) (201,594)
  Operating income                    260,597   171,560   515,263   331,045

  Non-operating income (expense):
    Interest expense, net             (92,622)  (80,181) (182,432) (162,979)
    Other                              (8,147)   (4,900)  (20,603)   (2,575)
                                     (100,769)  (85,081) (203,035) (165,554)

  Income from continuing operations
   before income taxes                159,828    86,479   312,228   165,491
    Provision for income taxes        (58,165)  (32,023) (113,425)  (62,259)
  Income from continuing operations  $101,663  $ 54,456  $198,803  $103,232



                         MGM MIRAGE AND SUBSIDIARIES
                  SUPPLEMENTAL DATA - NET REVENUES BY RESORT
                                (In thousands)
                                 (Unaudited)

                               Three Months Ended        Six Months Ended
                               June 30,    June 30,    June 30,    June 30,
                                 2004        2003        2004        2003
    Bellagio                $  261,857     $260,176  $  540,491  $  500,540
    MGM Grand Las Vegas        217,398      180,333     440,418     364,476
    The Mirage                 149,204      145,268     288,258     295,375
    Treasure Island             95,128       86,951     194,924     176,893
    New York-New York           82,748       59,762     165,541     121,673
    MGM Grand Detroit          112,067      102,478     215,984     197,247
    Beau Rivage                 82,192       76,862     155,178     147,273
    Other operations            71,931       62,287     138,167     122,514
                            $1,072,525     $974,117  $2,138,961  $1,925,991



                         MGM MIRAGE AND SUBSIDIARIES
                     SUPPLEMENTAL DATA - EBITDA BY RESORT
                                (In thousands)
                                 (Unaudited)

                                    Three Months Ended     Six Months Ended
                                   June 30,     June 30,  June 30,  June 30,
                                     2004         2003      2004      2003
    Bellagio                      $ 82,716     $ 93,505  $181,735  $161,668
    MGM Grand Las Vegas             83,075       51,327   158,904   105,341
    The Mirage                      51,041       37,387    91,169    79,747
    Treasure Island                 26,312       23,119    57,615    49,342
    New York-New York               31,248       22,782    63,372    48,297
    MGM Grand Detroit               44,404       39,623    82,966    76,557
    Beau Rivage                     22,079       19,748    38,868    34,597
    Other operations                13,579       10,126    26,144    19,028
    Income from unconsolidated
     affiliates                     29,542        8,547    53,714    19,336
                                  $383,996     $306,164  $754,487  $593,913



                         MGM MIRAGE AND SUBSIDIARIES
            RECONCILIATION OF OPERATING INCOME TO EBITDA BY RESORT
                                (In thousands)
                                 (Unaudited)

                       Three Months Ended June 30, 2004

                            Depreci-   Pre-
                             ation    opening           Property
                              and      and     Restruc-  trans-
                Operating    amorti- start-up  turing   actions,
                 income      zation  expenses   costs     net      EBITDA
   Bellagio     $ 58,232    $22,004   $   --   $3,000   $ (520)  $ 82,716
   MGM Grand
    Las Vegas     55,752     22,170    1,501      900    2,752     83,075
   The Mirage     38,149     12,903       --       --      (11)    51,041
   Treasure
    Island        17,312      8,886      118       --       (4)    26,312
   New York-
    New York      23,192      8,011       --       --       45     31,248
   MGM Grand
    Detroit       37,074      7,373       --       --      (43)    44,404
   Beau Rivage    16,669      5,242       --       --      168     22,079
   Other
    operations     7,237      5,804       --       --      538     13,579
   Unconsolidated
    affiliates    29,542         --       --       --       --     29,542
                 283,159     92,393    1,619    3,900    2,925    383,996
   Corporate
    and other    (22,562)     5,091       --       --     (987)   (18,458)
                $260,597    $97,484   $1,619   $3,900   $1,938   $365,538



                       Three Months Ended June 30, 2003

                               Depreci-   Pre-
                                ation    opening           Property
                                and       and     Restruc-  trans-
                  Operating    amorti-  start-up  turing   actions,
                   income      zation   expenses  costs      net     EBITDA
   Bellagio       $ 66,267    $ 27,143   $    --   $ --   $   95   $ 93,505
   MGM Grand
    Las Vegas       28,339      20,540       300     --    2,148     51,327
   The Mirage       25,131      12,332        --     --      (76)    37,387
   Treasure
    Island          14,397       8,600        --    178      (56)    23,119
   New York-
    New York        14,847       5,938     2,015     --      (18)    22,782
   MGM Grand
    Detroit         30,480       8,543       300     --      300     39,623
   Beau Rivage      14,171       4,762        --     --      815     19,748
   Other
    operations       5,483       4,783        --     --     (140)    10,126
   Unconsolidated
    affiliates      (3,281)         --    11,828     --       --      8,547
                   195,834      92,641    14,443    178    3,068    306,164
   Corporate
    and other      (24,274)      8,403       453    370       26    (15,022)
                  $171,560    $101,044   $14,896   $548   $3,094   $291,142



                         MGM MIRAGE AND SUBSIDIARIES
      RECONCILIATION OF OPERATING INCOME TO EBITDA BY RESORT - continued
                                (In thousands)
                                 (Unaudited)

                        Six Months Ended June 30, 2004

                               Depreci-   Pre-
                                ation    opening          Property
                                and       and     Restruc- trans-
                 Operating     amorti-  start-up  turing   actions,
                  income       zation   expenses  costs     net     EBITDA
   Bellagio      $135,323    $ 42,356   $   --   $3,000   $1,056   $181,735
   MGM Grand
    Las Vegas     107,729      45,688    1,839      900    2,748    158,904
   The Mirage      65,560      25,560       --       --       49     91,169
   Treasure
    Island         39,963      17,546      118       --      (12)    57,615
   New York-
    New York       47,949      15,464      (86)      --       45     63,372
   MGM Grand
    Detroit        67,773      14,847       --       --      346     82,966
   Beau Rivage     28,343      10,546       --       --      (21)    38,868
   Other
    operations     15,502      10,189       --       --      453     26,144
   Unconsolidated
    affiliates     53,714          --       --       --       --     53,714
                  561,856     182,196    1,871    3,900    4,664    754,487
   Corporate
    and other     (46,593)     12,841      129      414     (987)   (34,196)

                 $515,263    $195,037   $2,000   $4,314   $3,677   $720,291



                        Six Months Ended June 30, 2003

                             Depreci-    Pre-
                              ation     opening          Property
                              and        and     Restruc- trans-
                 Operating   amorti-   start-up  turing   actions,
                  income     zation    expenses  costs     net      EBITDA
   Bellagio      $106,548  $ 55,015   $    --   $   --   $  105    $161,668
   MGM Grand
    Las Vegas      55,218    40,728       891       25    8,479     105,341
   The Mirage      54,825    24,767        --      300     (145)     79,747
   Treasure
    Island         32,478    16,819        --      178     (133)     49,342
   New York-
    New York       34,318    11,888     2,067       --       24      48,297
   MGM Grand
    Detroit        58,677    17,124       300       --      456      76,557
   Beau Rivage     24,173     9,403        --       --    1,021      34,597
   Other
    operations      9,388     9,780        --       --     (140)     19,028
   Unconsolidated
    affiliates      3,435        --    15,901       --       --      19,336
                  379,060   185,524    19,159      503    9,667     593,913
   Corporate
    and other     (48,015)   16,070     2,284      650      243     (28,768)

                 $331,045  $201,594   $21,443   $1,153   $9,910    $565,145



                         MGM MIRAGE AND SUBSIDIARIES
                    SUPPLEMENTAL DATA - HOTEL STATISTICS
                                 (Unaudited)

                                       Three Months Ended  Six Months Ended
                                         June 30, June 30, June 30, June 30,
                                          2004     2003     2004     2003
     Bellagio
        Occupancy %                       96.4%    96.3%    95.9%    94.5%
        Average daily rate (ADR)           $240     $229     $247     $234
        Revenue per available room
         (REVPAR)                          $231     $221     $237     $221

     MGM Grand Las Vegas
        Occupancy %                       95.0%    94.9%    93.6%    93.8%
        Average daily rate (ADR)           $131     $114     $135     $117
        Revenue per available room
         (REVPAR)                          $124     $109     $126     $110

     The Mirage
        Occupancy %                       98.6%    96.9%    96.4%    94.7%
        Average daily rate (ADR)           $150     $134     $153     $141
        Revenue per available room
         (REVPAR)                          $148     $130     $148     $134

     Treasure Island
        Occupancy %                       99.0%    98.2%    97.8%    97.1%
        Average daily rate (ADR)           $115      $99     $119     $104
        Revenue per available room
         (REVPAR)                          $113      $97     $116     $101

     New York-New York
        Occupancy %                       98.6%    98.8%    98.0%    98.6%
        Average daily rate (ADR)           $116      $95     $118      $99
        Revenue per available room
         (REVPAR)                          $115      $94     $115      $97

     Beau Rivage
        Occupancy %                       94.9%    94.7%    90.5%    92.9%
        Average daily rate (ADR)            $98      $98      $95      $93
        Revenue per available room
         (REVPAR)                           $93      $93      $86      $86

     Other operations
        Occupancy %                       75.5%    68.3%    72.3%    68.6%
        Average daily rate (ADR)            $41      $42      $42      $43
        Revenue per available room
         (REVPAR)                           $31      $29      $30      $30



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

                                               June 30,         December 31,
                                                 2004               2003

                             ASSETS
  Current assets:
      Cash and cash equivalents              $   185,793        $   178,047
      Accounts receivable, net                   166,166            139,475
      Inventories                                 64,110             65,189
      Income tax receivable                           --              9,901
      Deferred income taxes                       48,458             49,286
      Prepaid expenses and other                  77,189             89,641
      Assets held for sale                        81,907            226,082
            Total current assets                 623,623            757,621

  Property and equipment, net                  8,790,673          8,681,339

  Other assets:
      Investments in unconsolidated
       affiliates                                791,812            756,012
      Goodwill and other intangible
       assets, net                               232,353            267,668
      Deposits and other assets, net             265,747            247,070
            Total other assets                 1,289,912          1,270,750
                                             $10,704,208        $10,709,710


                  LIABILITIES AND STOCKHOLDERS' EQUITY

  Current liabilities:
      Accounts payable                       $   127,650        $    85,439
      Income taxes payable                        38,118                 --
      Current portion of long-term
       debt                                        6,802              9,008
      Accrued interest on long-term
       debt                                       95,629             87,711
      Other accrued liabilities                  512,764            559,445
      Liabilities related to assets
       held for sale                               7,207             23,456
            Total current liabilities            788,170            765,059

  Deferred income taxes                        1,731,916          1,765,426
  Long-term debt                               5,526,728          5,521,890
  Other long-term obligations                    148,054            123,547
  Stockholders' equity:
      Common stock ($.01 par value:
       authorized 300,000,000 shares,
      issued 171,762,565 and
       168,268,213 shares and
       outstanding
      138,684,079 and 143,096,213
       shares)                                     1,718              1,683
      Capital in excess of par value           2,280,366          2,171,625
      Deferred compensation                      (14,871)           (19,174)
      Treasury stock, at cost
       (33,078,486 and 25,172,000
       shares)                                (1,105,189)          (760,594)
      Retained earnings                        1,344,468          1,133,903
      Accumulated other comprehensive
       income                                      2,848              6,345
            Total stockholders' equity         2,509,340          2,533,788
                                             $10,704,208        $10,709,710

SOURCE: MGM MIRAGE

CONTACT: investors, James J. Murren, President, Chief Financial Officer
and Treasurer, +1-702-693-8877, or media, Alan Feldman, Senior Vice President,
Public Affairs, +1-702-891-7147, both of MGM MIRAGE

Web site: http://www.mgmmirage.com/