DOW JONES NEWSWIRES
MGM Mirage (MGM) said earnings and revenue would be lower than
Wall Street expects in a preliminary report for the first
quarter.
Shares were down 3% at $14.95 in after-hours trading. Through
Wednesday's close, the stock had more than doubled in value over
the last year.
MGM said it expects a 22-cent first-quarter loss, swinging from
a 38 cent profit a year earlier, though both contained one-time
items.
Excluding a large gain from extinguishing debt and a smaller
impairment charge, the loss would have been 31 cents a share.
Analysts, who typically exclude one-time items from their view,
were expecting a 21-cent loss, according to a survey by Thomson
Reuters.
The company also said revenue would likely be $1.46 billion,
below the average analyst estimate for $1.43 billion. The
first-quarter projection represents another year-on-year sales
slide, indicating that the casino industry is still struggling to
recover.
Total casino revenue is expected to be approximately 5% lower
than the prior year, an improvement from the fourth quarter's 11%
drop.
MGM said that its revenue-per-available-room, a key lodging
metric, on the Las Vegas Strip fell 8% from a year earlier, with
occupancy of 85%. The tourist haven has struggled in the recession
as gamblers either quit to save money or place their bets at
casinos closer to home, while corporations are avoiding taking
business trips to such a flashy locale.
The company is to report earnings next month.
Debt-laden MGM's prospects have improved dramatically in the
past year as the company has taken steps to restructure its debt
load. As of the end of March, it had $13 billion in debts.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com