LAS VEGAS, May 3 /PRNewswire-FirstCall/ -- MGM MIRAGE (NYSE:MGM)
today reported its first quarter 2007 financial results, achieving
the Company's highest ever first quarter diluted earnings per share
from continuing operations of $0.55, a 15% increase over the $0.48
per share earned in 2006. Net income per share on a diluted basis,
including the results of discontinued operations, was $0.57 per
share compared to $0.49 per share in 2006. Net revenues for the
first quarter increased 9% to $1.9 billion, an all-time record
revenue performance for the Company in any quarter. First quarter
revenues were positively impacted by strong room pricing at the
Company's Las Vegas Strip resorts, the reopening of Beau Rivage in
August 2006, and the continued impact of new restaurants,
nightclubs and shows at several resorts. Earnings benefited from
the strong revenue trends, solid operating margins, and profits
from sales of the remaining units of Tower 2 of the Signature at
MGM Grand. Key results from the quarter include: * Non-gaming
revenues increased 12%, 10% excluding Beau Rivage, validating the
Company's strategic reinvestment in non-gaming amenities; * Las
Vegas Strip REVPAR(1) increased 9%, which represents the fifteenth
consecutive quarter of year-over-year REVPAR increases for these
resorts; * Gaming revenues increased 4% but decreased 6% excluding
Beau Rivage. Table games volume, including baccarat, decreased 7%
excluding Beau Rivage; * Record first quarter Property EBITDA(2) of
$655 million, a 7% increase over the prior year; Property EBITDA
margins remained strong at 34% in the first quarter; * All-time
record Property EBITDA at several Las Vegas Strip resorts,
including Bellagio, MGM Grand Las Vegas, Mandalay Bay, Treasure
Island and Monte Carlo; * Beau Rivage, which was closed in the
prior year quarter, earned Property EBITDA of $28 million, an
all-time record for any quarter for Beau Rivage(3); * Repurchased
2.5 million shares for $175 million during the quarter. Recent
significant developments include: * Signed a definitive agreement
with Diaoyutai State Guesthouse. The joint venture is initially
targeting locations for non-gaming luxury hotels in the People's
Republic of China; * Signed a definitive agreement with Mubadala
Development Company, an investment and development vehicle
established and wholly owned by the Government of the Emirate of
Abu Dhabi, U.A.E.; * Announced an increase to the CityCenter
construction budget to $7.4 billion and announced increased
expected gross proceeds from sales of residential units - $2.7
billion, up from $2.5 billion -- as a result of the strong initial
public reception of the residential offerings. The current expected
net cost of CityCenter is $4.7 billion; * Entered into agreements
to acquire 34 acres on the Las Vegas Strip adjacent to Circus
Circus Las Vegas, which together with land already owned creates a
78-acre site available for future development; * Completed the sale
of the Primm Valley Resorts and expect to close the sale of the
Laughlin Properties -- Colorado Belle and Edgewater -- during the
second quarter; * Entered into an agreement to invest in The M
Resort, an 80-acre mixed-use development located about ten miles
south of Bellagio on Las Vegas Blvd. The following table lists
significant items which affect the comparability of the current
year and prior year results (EPS impact shown, net of tax, per
diluted share; negative amounts represent charges to income): Three
months ended March 31, 2007 2006 ----------------------------
-------- -------- Profits from The Signature at MGM Grand $ 0.02 $
-- Preopening and start-up expenses (0.03) (0.02) Property
transactions, net (0.01) (0.05) "We remain focused on executing our
vision for the Las Vegas Strip and expanding our brands globally as
evidenced by our recent Las Vegas Strip land acquisitions and our
strategic partnerships with first-class organizations that share
our vision," said Terry Lanni, MGM MIRAGE's Chairman and CEO. "As
leaders in shaping the future of Las Vegas and expanding markets
world-wide, we and our partners are setting the bar for quality,
design, and long-term sustainable growth." Net revenues increased
9%; excluding Beau Rivage, net revenues were up 3%. The Company
generated increased revenues from non-gaming operations due to
strong room pricing, new and upgraded food and beverage outlets,
and exclusive entertainment shows and events. As a part of the
Company's efforts to continuously update its entertainment
offerings, it will add a new Cirque du Soleil show starring Criss
Angel at the Luxor in 2008 and is adding several new and exciting
restaurants, nightclubs and other amenities at Luxor, Monte Carlo,
Excalibur, New York-New York and Mandalay Bay. Gaming revenues
increased 4%, but decreased 6% excluding Beau Rivage. Table games
volumes at the Company's Las Vegas Strip resorts decreased 7%
compared to a robust prior year first quarter. Table games hold
percentages were near the mid-point of the normal 18-22% range in
both periods. Slot revenues at the Company's Las Vegas Strip
resorts decreased 3% from the prior year first quarter. Rooms
revenues increased 8%, 5% excluding Beau Rivage despite having
98,000 less available rooms as a result of room remodel projects,
primarily at Mandalay Bay and Excalibur. Average rates increased 8%
at the Company's Las Vegas Strip resorts. Las Vegas Strip REVPAR
increased 9%, led by double-digit percentage increases at Mandalay
Bay, The Mirage, and TI. The following table shows key hotel
statistics for the Company's Las Vegas Strip resorts: Three Months
Ended ------------------------ March 31, March 31, 2007 2006
---------- ---------- Occupancy % 96% 95% Average Daily Rate (ADR)
$ 169 $ 157 Revenue per Available Room (REVPAR) $ 162 $ 149 The
Company's operating income increased 8% to $445 million, which
includes $8 million of profit from closings on the final units of
Tower 2 of the Signature at MGM Grand and $16 million of operating
income from Beau Rivage. Excluding these items, operating income
increased 2% from prior year with a margin of 23% in both quarters.
EBITDA increased 3% and Property EBITDA increased 2%, also
excluding these items, with comparable Property EBITDA margins of
34% in both periods. Detailed Discussion of Certain Charges In the
first quarter of 2007, the Company incurred $5 million of net
property transactions primarily related to the write-off of the net
book value of the building assets of Nevada Landing, which closed
in March. In the 2006 period, net property transactions of $23
million largely related to the write-off of the tram connecting
Bellagio and Monte Carlo and the related tram station assets ($12
million at Bellagio and $10 million at Monte Carlo). Preopening and
start-up expenses of $14 million in 2007 primarily related to
CityCenter, the Detroit permanent casino, and MGM Grand Macau.
Preopening and start-up expenses of $6 million in the 2006 quarter
related primarily to CityCenter, MGM Grand Macau, and The Signature
at MGM Grand. Financial Position First quarter capital investments
totaled $611 million, which included $300 million for CityCenter,
$66 million for the permanent MGM Grand Detroit hotel and casino,
and $40 million of trailing payments for Beau Rivage rebuilding.
Remaining capital expenditures included spending of $65 million on
room and suite remodel projects, primarily at Excalibur and
Mandalay, expenditures for corporate aircraft of $55 million, and
$85 million of other routine capital expenditures on various new
and upgraded amenities at the Company's resorts. During the quarter
the Company received an additional $56 million of insurance
recoveries related to Hurricane Katrina. These amounts were not
recognized as income pending the final settlement of the Company's
insurance claim. During the first quarter of 2007, the Company
repurchased 2.5 million shares of its common stock for $175
million, leaving 5.5 million shares available under the Company's
current authorization. At March 31, 2007, the Company had $2.3
billion of available borrowings under its senior credit facility.
"We continue to generate significant operating cash flow from our
existing resorts and reinvest strategically in those resorts," said
Jim Murren, MGM MIRAGE President, CFO and Treasurer. "In addition,
we are in the home stretch of construction in Macau and Detroit and
look forward to adding significantly to our cash flow base when
these resorts open in late 2007. Along with our significant
available bank borrowings and ready access to the capital markets,
our powerful cash flow generation will allow us to fund a pipeline
of development projects for years to come." MGM MIRAGE will hold a
conference call to discuss its first quarter earnings results and
outlook for the second quarter at 11:00 a.m. Eastern Daylight Time
today. The call can be accessed live at
http://www.companyboardroom.com/ or http://www.mgmmirage.com/, or
by calling 1-800-526-8531 (domestic) or 1-706-634-6528
(international). Until Thursday, May 10, 2007, a complete replay of
the conference call can be accessed by dialing 1-706-645-9291,
access code 7329695. A complete replay of the call will also be
made available at http://www.mgmmirage.com/. Supplemental detailed
earnings information will also be available on the Company's
website. (1) REVPAR is hotel Revenue per Available Room. (2)
"EBITDA" is earnings before interest and other non-operating income
(expense), taxes, depreciation and amortization. "Property EBITDA"
is EBITDA before corporate expense and stock compensation expense.
EBITDA information 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. In addition, capital
allocation, tax planning, financing and stock compensation awards
are all managed at the corporate level. Management uses Property
EBITDA 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, 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 net income and of operating income to Property EBITDA are
included in the financial schedules accompanying this release. (3)
Beau Rivage earned operating income of $16 million in the first
quarter of 2007, with depreciation and amortization of $12 million.
Beau Rivage was closed during the prior year first quarter as a
result of Hurricane Katrina. MGM MIRAGE (NYSE:MGM), one of the
world's leading and most respected hotel and gaming companies, owns
and operates 19 properties located in Nevada, Mississippi and
Michigan, and has investments in three other properties in Nevada,
New Jersey and Illinois. The Company has entered into an agreement
to sell its Colorado Belle and Edgewater properties located in
Laughlin, Nevada. In addition, the Company has major new
developments under construction in Nevada, Michigan and Macau
S.A.R. CityCenter is a multi-billion dollar mixed-use urban
development in the heart of the Las Vegas Strip; a new MGM Grand
hotel and casino complex is being built in downtown Detroit; and
the Company has a 50% interest in MGM Grand Macau, a hotel-casino
resort currently under construction in Macau S.A.R. MGM MIRAGE
supports responsible gaming and has implemented the American Gaming
Association's Code of Conduct for Responsible Gaming at its
properties. MGM MIRAGE also has been the recipient of numerous
awards and recognitions for its industry-leading Diversity
Initiative and its community philanthropy programs. 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
------------------------------ March 31, March 31, 2007 2006
------------------------------ Revenues: Casino $ 811,939 $ 780,258
Rooms 549,004 508,398 Food and beverage 417,449 369,044
Entertainment 134,248 98,980 Retail 68,250 64,486 Other 122,070
105,795 ------------ ------------ 2,102,960 1,926,961 Less:
Promotional allowances (173,525) (152,593) ------------
------------ 1,929,435 1,774,368 ------------ ------------
Expenses: Casino 418,108 411,032 Rooms 141,774 132,700 Food and
beverage 244,382 216,371 Entertainment 98,145 72,892 Retail 44,391
43,886 Other 72,245 55,022 General and administrative 285,105
250,111 Corporate expense 33,955 36,652 Preopening and start-up
expenses 14,276 6,181 Restructuring costs - 804 Property
transactions, net 5,019 23,485 Depreciation and amortization
168,277 147,433 ------------ ------------ 1,525,677 1,396,569
------------ ------------ Income from unconsolidated affiliates
41,375 35,554 ------------ ------------ Operating income 445,133
413,353 ------------ ------------ Non-operating income (expense):
Interest income 2,657 2,745 Interest expense, net (184,011)
(192,849) Non-operating items from unconsolidated affiliates
(5,106) (3,595) Other, net (2,728) (3,044) ------------
------------ (189,188) (196,743) ------------ ------------ Income
from continuing operations before income taxes 255,945 216,610
Provision for income taxes (92,935) (76,848) ------------
------------ Income from continuing operations 163,010 139,762
------------ ------------ Discontinued operations: Income from
discontinued operations 7,846 6,482 Provision for income taxes
(2,683) (2,207) ------------ ------------ 5,163 4,275 ------------
------------ Net income $ 168,173 $ 144,037 ============
============ Per share of common stock: Basic: Income from
continuing operations $ 0.57 $ 0.49 Discontinued operations 0.02
0.02 ------------ ------------ Net income per share $ 0.59 $ 0.51
============ ============ Weighted average shares outstanding
284,021 284,200 ============ ============ Diluted: Income from
continuing operations $ 0.55 $ 0.48 Discontinued operations 0.02
0.01 ------------ ------------ Net income per share $ 0.57 $ 0.49
============ ============ Weighted average shares outstanding
295,577 292,783 ============ ============ MGM MIRAGE AND
SUBSIDIARIES SUPPLEMENTAL DATA - NET REVENUES (In thousands)
(Unaudited) Three Months Ended --------------------------------
March 31, March 31, 2007 2006 -------------- -------------- Las
Vegas Strip $ 1,626,343 $ 1,571,604 Other Nevada 44,432 46,799 MGM
Grand Detroit 116,134 115,093 Mississippi 142,526 40,872
-------------- -------------- $ 1,929,435 $ 1,774,368
============== ============== MGM MIRAGE AND SUBSIDIARIES
SUPPLEMENTAL DATA - PROPERTY EBITDA (In thousands) (Unaudited)
Three Months Ended -------------------------------- March 31, March
31, 2007 2006 -------------- -------------- Las Vegas Strip $
548,842 $ 523,381 Other Nevada (1,996) 5,575 MGM Grand Detroit
34,826 37,100 Mississippi 35,403 9,359 Unconsolidated resorts
38,142 34,196 -------------- -------------- $ 655,217 $ 609,611
============== ============== MGM MIRAGE AND SUBSIDIARIES DETAIL OF
CERTAIN CHARGES AFFECTING PROPERTY EBITDA and EBITDA (In thousands)
(Unaudited) Three Months Ended March 31, 2007
--------------------------------- Preopening Property and start-up
Restructuring transactions, expenses costs net Total -------------
------------- ------------- ------------- Las Vegas Strip $ 8,472 $
-- $ 278 $ 8,750 Other Nevada -- -- 4,630 4,630 MGM Grand Detroit
2,379 -- -- 2,379 Mississippi -- -- (2) (2) Unconsolidated resorts
3,233 -- -- 3,233 ------------- ------------- -------------
------------- 14,084 -- 4,906 18,990 Corporate and other 192 -- 113
305 ------------- ------------- ------------- ------------- $
14,276 $ -- $ 5,019 $ 19,295 ============= =============
============= ============= Three Months Ended March 31, 2006
--------------------------------- Preopening Property and start-up
Restructuring transactions, expenses costs net Total -------------
------------- ------------- ------------- Las Vegas Strip $ 3,208 $
804 $ 23,493 $ 27,505 Other Nevada -- -- (3) (3) MGM Grand Detroit
593 -- (2) 591 Mississippi -- -- (3) (3) Unconsolidated resorts
2,221 -- -- 2,221 ------------- ------------- -------------
------------- 6,022 804 23,485 30,311 Corporate and other 159 -- --
159 ------------- ------------- ------------- ------------- $ 6,181
$ 804 $ 23,485 $ 30,470 ============= ============= =============
============= MGM MIRAGE AND SUBSIDIARIES RECONCILIATION OF
CONSOLIDATED EBITDA TO INCOME FROM CONTINUING OPERATIONS (In
thousands) (Unaudited) Three Months Ended
-------------------------------- March 31, March 31, 2007 2006
-------------- -------------- EBITDA $ 613,410 $ 560,786
Depreciation and amortization (168,277) (147,433) --------------
-------------- Operating income 445,133 413,353 --------------
-------------- Non-operating income (expense): Interest expense,
net (184,011) (192,849) Other (5,177) (3,894) --------------
-------------- (189,188) (196,743) -------------- --------------
Income from continuing operations before income taxes 255,945
216,610 Provision for income taxes (92,935) (76,848) --------------
-------------- Income from continuing operations $ 163,010 $
139,762 ============== ============== MGM MIRAGE AND SUBSIDIARIES
RECONCILIATION OF OPERATING INCOME TO PROPERTY EBITDA (In
thousands) (Unaudited) Three Months Ended March 31, 2007
--------------------------------- Depreciation Operating and income
amortization EBITDA ------------- --------------- --------------
Las Vegas Strip $ 414,945 $ 133,897 $ 548,842 Other Nevada (3,871)
1,875 (1,996) MGM Grand Detroit 28,864 5,962 34,826 Mississippi
20,237 15,166 35,403 Unconsolidated resorts 38,142 -- 38,142
------------- --------------- -------------- 498,317 156,900
655,217 Stock compensation (13,580) Corporate and other (28,227)
-------------- $ 613,410 ============== Three Months Ended March
31, 2006 --------------------------------- Depreciation Operating
and income amortization EBITDA ------------- ---------------
-------------- Las Vegas Strip $ 395,351 $ 128,030 $ 523,381 Other
Nevada 3,219 2,356 5,575 MGM Grand Detroit 34,183 2,917 37,100
Mississippi 3,859 5,500 9,359 Unconsolidated resorts 34,196 --
34,196 ------------- --------------- -------------- 470,808 138,803
609,611 Stock compensation (21,096) Corporate and other (27,729)
-------------- $ 560,786 ============== MGM MIRAGE AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (In thousands, except share data)
(Unaudited) March 31, December 31, 2007 2006 --------------
-------------- ASSETS Current assets: Cash and cash equivalents $
313,967 $ 452,944 Accounts receivable, net 373,391 362,921
Inventories 124,500 118,459 Income tax receivable -- 18,619
Deferred income taxes 70,405 68,046 Prepaid expenses and other
133,620 124,414 Assets held for sale 418,936 369,348 --------------
-------------- Total current assets 1,434,819 1,514,751
-------------- -------------- Real estate under development 244,520
188,433 Property and equipment, net 17,630,756 17,241,860 Other
assets: Investments in unconsolidated affiliates 1,086,189
1,092,257 Goodwill 1,269,591 1,300,747 Other intangible assets, net
364,564 367,200 Deposits and other assets, net 527,330 440,990
-------------- -------------- Total other assets 3,247,674
3,201,194 -------------- -------------- $ 22,557,769 $ 22,146,238
============== ============== LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable $ 157,022 $ 182,154
Construction payable 296,064 234,486 Income taxes payable 38,695 --
Accrued interest on long-term debt 194,343 232,957 Other accrued
liabilities 905,503 958,244 Liabilities related to assets held for
sale 43,325 40,259 -------------- -------------- Total current
liabilities 1,634,952 1,648,100 -------------- --------------
Deferred income taxes 3,378,256 3,441,157 Long-term debt 13,240,315
12,994,869 Other long-term obligations 372,648 212,563
Stockholders' equity: Common stock, $.01 par value: authorized
600,000,000 shares, issued 365,005,233 and 362,886,027 shares and
outstanding 283,528,206 and 283,909,000 shares 3,650 3,629 Capital
in excess of par value 2,895,060 2,806,636 Treasury stock, at cost:
81,477,027 and 78,977,027 shares (1,771,707) (1,597,120) Retained
earnings 2,804,162 2,635,989 Accumulated other comprehensive income
433 415 -------------- -------------- Total stockholders' equity
3,931,598 3,849,549 -------------- -------------- $ 22,557,769 $
22,146,238 ============== ============== DATASOURCE: MGM MIRAGE
CONTACT: Investment Community, James J. Murren, President, Chief
Financial Officer & Treasurer, +1-702-693-8877, or News Media,
Alan M. Feldman, Senior Vice President, Public Affairs,
+1-702-891-7147, both of MGM MIRAGE Web site:
http://www.mgmmirage.com/
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