| LAS VEGAS, July 27, 2000 - MGM MIRAGE (NYSE:
MGG) today reported an 82% increase in net income, before non-recurring
charges and preopening expenses, to $60.7 million for the second quarter
ended June 30, 2000 compared with $33.3 million in the year ago period.
Including non-recurring and preopening expenses the Company reported a
net loss of $19 million.
Earnings per share, before non-recurring charges and preopening expenses,
rose 54% to 40 cents a share, up from 26 cents a share in the prior-year�s
quarter. These results reflect strong casino and hotel volume, improved
operating margins, same-store cash flow growth, and the one month impact
of the historic acquisition of Mirage Resorts, Incorporated (�Mirage Resorts�).
These second quarter results exceeded the average estimate of 34 cents
a share from analysts polled by First Call Corp. Revenues and operating
cash flow soared 97% and 103%, respectively, representing the sixth consecutive
quarterly increase in revenue and EBITDA on a year-over-year basis.
Excluding the Mirage Resorts acquisition, revenue rose 36% to $433.7 million
while EBITDA grew 54% to $151.2 million quarter-over-quarter.
Second Quarter Company Highlights
-
Our net revenue was an all-time record high of $627 million
-
Our earnings rose 54% to 40 cents per diluted share before non-recurring
charges and preopening expenses
-
Our EBITDA increased to an all-time record $199 million
-
All of our operating properties produced significant free cash flow
-
We raised $1.23 billion in a private equity placement of 46.5 million shares
-
We completed the acquisition of Mirage Resorts on May 31st, representing
the largest transaction in the history of the gaming industry, closing
in just 87 days
-
We secured $4.3 billion in bank financing
-
We issued $710 million in Senior Subordinated Notes
-
We sold approximately $154 million in non-strategic assets acquired in
the Mirage Resorts acquisition
-
We achieved significant cost savings ahead of targeted results
Company Wide Operating Results The
Company�s consolidated net revenue of $627.2 million for the three months
ended June 30, 2000 set an all-time record, up 97% from the prior-year�s
quarter of $319.1 million. Net revenue benefited from the May 31st
acquisition of Mirage Resorts, which contributed $193.5 million in net
revenue during the 2000 second quarter, and was aided by a 6% increase
in net revenue at the MGM Grand Las Vegas and the incremental net revenue
from MGM Grand Detroit, which commenced operations on July 29, 1999.
EBITDA soared to an all-time record $198.9 million, up 103% from $97.9
million in the 1999 quarter. This increase reflects same-store EBITDA
growth of 10%, a full quarter contribution from MGM Grand Detroit and a
one-month contribution from Mirage Resorts. The Company continues
to maximize its profitability, as evidenced by the increase in the overall
EBITDA margin from 31% in 1999 to 32% in the 2000 second quarter.
�We are extremely proud of the operational and financial progress already
achieved in such a short time as we seamlessly blend MGM Grand and Mirage
Resorts to create MGM MIRAGE, the premiere company in the gaming industry,�
said J. Terrence Lanni, Chairman of the Board of MGM MIRAGE. �We
are experiencing broad-based internal growth throughout our portfolio of
properties and are optimistic about our future prospects.�
�The integration of MGM Grand and Mirage Resorts is proceeding smoothly,
and we are on track to meet or exceed the financial and operating goals
set when we acquired Mirage Resorts,� said James J. Murren, President and
Chief Financial Officer of MGM MIRAGE. �Asset sales and free cash
flow have already reduced our outstanding indebtedness by $225 million
since the closing of the acquisition.�
MGM Grand Las Vegas - The City of Entertainment
MGM Grand Las Vegas - The City of Entertainment produced EBITDA of
$56 million for the three months ended June 30, 2000, up 18% when compared
with $47.4 million in the 1999 period. Net revenue reached $203.9
million for the 2000 second quarter, an increase of 6% over the $191.5
million achieved in the 1999 period. Operating strategies fully underway
continue to improve profitability, as EBITDA margins expanded from 25%
in the second quarter of 1999 to 27% in the 2000 period. Higher revenues
were achieved throughout the resort. Casino revenue grew 5% primarily
driven by an 8% increase in table games volume, and a slightly higher table
games hold percentage, while slot volume remained relatively flat.
Room revenue rose in the 2000 second quarter despite a 6% reduction in
the available rooms due to the ongoing room remodeling project, which covers
substantially all of the standard guestrooms and is scheduled to be completed
in August 2000. The average daily room rate (�ADR�) increased to
$110 from $100 in the 1999 second quarter, while revenue per available
room (�REVPAR�) increased $9 to $109. Occupancy for the 2000 second
quarter decreased slightly to 99.1% from 100% in 1999. This property�s
healthy operating performance affirms management�s decision to deploy capital
to reposition this facility as The City of Entertainment.
Bellagio
Bellagio produced strong 2000 second quarter net revenue of $224.2
million and EBITDA of $55.2 million, compared with $220.4 million and $46.6
million reported in the second quarter of 1999. The EBITDA margin
increased significantly to 25%, versus 21% in the prior-year quarter, reflecting
ongoing cost containment efforts. The growth in net revenue was fueled
principally by higher hotel, food and beverage and entertainment revenue.
Casino revenue was down 7%, mostly due to a lower table games hold percentage
and modestly lower table game volume. Slot volume rose 10% percent
in the quarter while slot revenue increased 2%. ADR and REVPAR both
increased by $16 over the 1999 second quarter to $170 and $168, respectively.
Occupancy was high at 98.6%, though relatively flat when compared with
the prior-year second quarter. Since the May 31st acquisition, Bellagio
contributed net revenue of $68.8 million and EBITDA of $17 million to the
Company�s 2000 second quarter results.
The Mirage
The Mirage posted solid earnings growth over the 1999 second quarter.
Net revenue increased by 13% to $152.7 million and EBITDA rose by 21% to
$35.4 million. Casino revenue increased by 10% or $6.4 million and
non-casino revenue grew by 15% or $13.4 million. A higher table games
hold percentage and an increase in slot revenue principally accounted for
the growth in casino revenue, while slot volume rose 2% and table game
drop was equal to the prior year. Hotel, food and beverage and entertainment
revenue all showed significant improvement. ADR was up by $8 to $123
and REVPAR increased by $7 to $120 as occupancy remained high at 97.4%.
Entertainment revenue during the 2000 second quarter benefited from the
opening of the new Danny Gans show. This popular singer/impersonator
began performing in an all-new theatre at The Mirage in early April.
Since then, both the Danny Gans and Siegfried & Roy shows have performed
to near capacity crowds. Giving effect to the May 31st acquisition,
The Mirage contributed $49.5 million in net revenue and $12.2 million in
EBITDA to the Company�s second quarter results.
New York - New York
New York - New York generated net revenue and EBITDA of $55.8 million
and
$25.8 million, respectively, compared with $54.7 million and $25.3
million in
1999. The EBITDA margin for the 2000 second quarter remained impressively
strong with the prior-year period at 46%. The increase in net revenue
was a result of increased room revenue due to higher ADR and REVPAR.
As a result of New York - New York�s exceptional free cash flow, the Company
was able to reduce the outstanding indebtedness attributable to this property
by $21.1 million in the quarter and $89 million since the acquisition of
the remaining 50% of New York - New York, in March 1999. Management
is in the process of implementing strategies to further enhance the entertainment
experience at New York - New York to drive future earnings growth.
Treasure Island
Treasure Island achieved its third consecutive year-over-year quarterly
earnings increase during the 2000 second quarter. Net revenue
climbed 9% to
$92.6 million and EBITDA increased by 23% to $26.9 million. The
EBITDA margin for the second quarter significantly increased from 26% in
1999 to 29% in 2000. Casino revenue grew by 4% over the prior-year quarter,
representing higher slot and table game volume partially offset by a decline
in the table games hold percentage. Non-casino revenue increased
by 13% over the 1999 quarter, reflecting growth in all departments.
The resort�s operating performance has improved considerably following
a room refurbishment program completed in the 1999 third quarter.
The program substantially upgraded the quality of the furnishings of its
guestrooms and assisted the property in receiving the Four Diamond rating
from AAA. ADR and REVPAR both increased to $98, compared with $94
and $93, respectively, during the 1999 second quarter. Since the
May 31st acquisition, Treasure Island contributed $29 million and $7.8
million in net revenue and EBITDA, respectively, to the Company�s second
quarter results.
Primm Properties
The Primm Properties (Whiskey Pete�s, Buffalo Bill�s and the Primm
Valley Resort located in Primm, Nevada and two championship golf courses
at the California/Nevada Stateline) produced net revenue for the 2000 second
quarter of $62.7 million and EBITDA of $20.9 million, representing a 33%
EBITDA margin. This compares with net revenue of $61.5 million, EBITDA
of $19.8 million, and an EBITDA margin of 32% during the 1999 second quarter.
The Primm Properties� strong free cash flow was used to reduce debt attributable
to these properties by $19.3 million in the quarter and by $72 million
since the March, 1999 acquisition of Primadonna.
Golden Nugget Properties
The Golden Nugget in downtown Las Vegas produced net revenue of $44.7
million and EBITDA of $8.9 million during the second quarter of 2000, compared
with $44 million and $7.7 million during the prior-year period. The
earnings improvement is attributable primarily to an increase in casino
revenue resulting from higher table game and slot volume. Earnings
comparisons at the Golden Nugget in Laughlin were consistent with those
of the 1999 second quarter. Since the May 31st acquisition, the Golden
Nugget properties contributed $17.6 million in net revenue and $2.6 million
in EBITDA to the Company�s second quarter results.
MGM Grand Detroit Casino
MGM Grand Detroit produced net revenue of $101 million and EBITDA of
$43.6 million for the three months ended June 30, 2000. MGM Grand
Detroit�s free cash flow has allowed the Company to reduce debt on its
outstanding Detroit Credit Facility from a high of $181 million to its
current balance of $108 million.
Beau Rivage
Beau Rivage reported its highest quarterly operating results since
its March 16, 1999 opening. Net revenue grew to $80.9 million and
EBITDA rose to $18 million. This compares with $78.5 million and
$11.5 million in the 1999 second quarter. Non-casino revenue increased
by 13%, reflecting meaningful improvement in room, food and beverage and
entertainment revenue.
Occupancy during the 2000 quarter increased to 99.2% compared with 83.4%
in prior-year period, resulting in a REVPAR increase of $9 to $89.
The casino revenue comparison was relatively flat with the 1999 second
quarter, as a 7% increase in slot revenue was offset by lower table game
revenue resulting from a decline in volume and hold percentage. The
EBITDA margin for the quarter rose to 22%. Similar to many new resorts,
Beau Rivage�s operating results were hampered during its initial start-up
period by overstaffing and other inefficiencies. As a result, the
EBITDA margin for the 1999 second quarter was 15%. Since the May
31st acquisition, Beau Rivage contributed $25.9 million and $5.4 million
in net revenue and EBITDA, respectively, to the Company�s second quarter
results.
Monte Carlo
The Monte Carlo Resort & Casino achieved net revenue of $71.3 million
and EBITDA of $26.4 million compared with net revenue of $66.2 million
and EBITDA of $22 million for the 1999 second quarter. Since the
May 31st acquisition, Monte Carlo, a 50% joint venture, contributed $2.7
million to the Company�s operating results.
MGM Grand Australia
MGM Grand Australia reported net revenue of $9.1 million and EBITDA
of $3.6 million in the 2000 second quarter compared with net revenue of
$8.8 million and EBITDA of $3.2 million in the 1999 period. MGM Grand
Australia�s EBITDA margin grew from 36% in the 1999 period to 40% in the
2000 quarter.
MGM MIRAGE AND SUBSIDIARIES
SUPPLEMENTAL DATA - PRO FORMA PROPERTY
OPERATING RESULTS (in thousands)
PRO FORMA (1)
Three Months Ended Six
Months Ended
June 30, June 30, June 30,
June 30,
2000 1999
2000 1999
NET REVENUES:
MGM Grand Las Vegas $203,875 $191,469
$420,612 $386,554
Bellagio
224,225 220,403 473,396
476,533
The Mirage
152,740 134,998 325,302
296,138
New York-New York 55,762
54,698 109,486
109,612
Treasure Island
92,564 84,576
188,080 172,974
Primm Properties
62,701 61,490
123,575 119,783
Golden Nugget Las Vegas 44,724
43,973 92,065
92,682
Golden Nugget Laughlin 11,834
12,727 25,309
26,557
MGM Grand Detroit (2) 100,990
-- 202,306
--
Beau Rivage (3)
80,934 78,492
158,783 90,998
MGM Grand Australia
9,144 8,817
18,247 16,542
Income from Unconsol.
Affiliate
10,927 8,446
19,302 18,031
MGM Grand South Africa
1,513 2,707
2,768 5,344
Eliminations and Other
(265) (121)
(402) (328)
$1,051,668 $902,675 $2,158,829 $1,811,420
EBITDA:
MGM Grand Las Vegas $ 56,029
$ 47,429 $117,064 $ 93,498
Bellagio
55,247 46,568
119,816 111,592
The Mirage
35,408 29,220
91,433 78,973
New York-New York
25,814 25,349
49,231 51,118
Treasure Island
26,891 21,800
55,501 46,119
Primm Properties
20,866 19,814
40,674 34,805
Golden Nugget Las Vegas 8,906
7,667 19,564
19,251
Golden Nugget Laughlin
1,685 1,665
4,238 4,157
MGM Grand Detroit (2)
43,597 --
79,427 --
Beau Rivage (3)
18,006 11,524
35,402 11,168
MGM Grand Australia
3,596 3,243
6,977 6,094
Income from Unconsol.
Affiliate
10,928 8,446
19,302 18,031
MGM Grand South Africa
1,480 2,157
2,716 4,239
Eliminations and Other
(218) (92)
(309) (203)
$308,235 $224,790 $641,036
$478,842
Note:
(1) Pro forma amounts include the results of operations
for the periods
presented before non-recurring expenses. The acquisition
of Primadonna Resorts, Inc. and Mirage Resorts, Incorporated occurred on
March 1, 1999 and May 31, 2000, respectively.
(2) MGM Grand Detroit commenced operations on July 29,
1999.
(3) Beau Rivage commenced operations on March 16,
1999. |
MGM MIRAGE AND SUBSIDIARIES
SUPPLEMENTAL STATISTICAL INFORMATION
Three Months Ended Six Months Ended
June 30, June 30,
June 30, June 30,
2000 1999
2000 1999
ROOM STATISTICS:
MGM Grand Las Vegas
(5,034 Rooms)
Occupancy %
99.1% 100.0%
98.1% 98.3%
Average Daily
Rate (ADR)
$ 110 $ 100
$ 110 $ 104
Revenue per Available
Room (REVPAR)
$ 109 $ 100
$ 108 $ 103
Bellagio(2)
(3,005 Rooms)
Occupancy %
98.6% 98.8%
98.7% 99.1%
Average Daily
Rate (ADR)
$ 170 $ 154
$ 170 $ 155
Revenue per Available
Room (REVPAR)
$ 168 $ 152
$ 168 $ 153
Mirage(2)
(3,044 Rooms)
Occupancy %
97.4% 98.6%
97.3% 98.5%
Average Daily
Rate (ADR)
$ 123 $ 115
$ 120 $ 115
Revenue per Available
Room (REVPAR)
$ 120 $ 113
$ 116 $ 113
New York-New York(1)
(2,024 Rooms)
Occupancy %
98.1% 99.3%
96.7% 98.7%
Average Daily
Rate (ADR)
$ 92 $
86 $ 89
$ 86
Revenue per Available
Room (REVPAR)
$ 90 $
85 $ 85
$ 85
Treasure Island(2)
(2,885 Rooms)
Occupancy %
99.8% 99.5%
99.4% 98.8%
Average Daily
Rate (ADR)
$ 98 $
94 $ 96
$ 95
Revenue per Available
Room (REVPAR)
$ 98 $
93 $ 96
$ 94
Primm Properties(1)
(2,642 Rooms)
Occupancy %
67.9% 71.2%
66.4% 69.9%
Average Daily
Rate (ADR)
$ 37 $
34 $ 37
$ 32
Revenue per Available
Room (REVPAR)
$ 25 $
24 $ 25
$ 22
Golden Nugget
Las Vegas(2)
(1,907 Rooms)
Occupancy %
98.8% 98.1%
97.9% 98.5%
Average Daily
Rate (ADR)
$ 57 $
55 $ 59
$ 57
Revenue per Available
Room (REVPAR)
$ 56 $
54 $ 58
$ 56
Golden Nugget
Laughlin (2)
(300 Rooms)
Occupancy %
92.7% 96.2%
94.9% 96.9%
Average Daily
Rate (ADR)
$ 38 $
36 $ 36
$ 35
Revenue per Available
Room (REVPAR)
$ 35 $
35 $ 34
$ 33
Beau Rivage (2)
(1,780 Rooms)
Occupancy %
99.2% 83.4%
97.0% 82.2%
Average Daily Rate
(ADR)
$ 89 $
96 $ 82
$ 96
Revenue per Available
Room (REVPAR)
$ 89 $
80 $ 79
$ 79
MGM Grand Australia
(96 Rooms)
Occupancy %
84.0% 78.3%
75.9% 65.7%
Average Daily
Rate (ADR)
$ 65 $
67 $ 62
$ 63
Revenue per Available
Room (REVPAR)
$ 54 $
52 $ 47
$ 41
Note:
(1) The Company acquired Primadonna
Resorts, Inc. on March 1, 1999,
thereby
acquiring the Primm Properties and the remaining 50% of New
York-New
York. The statistics for the Primm Properties and New York-
New
York reflect a full six months for the periods presented.
(2) The Company acquired Mirage Resorts,
Inc. on May 31, 2000 thereby
acquiring
the Mirage Properties and 50% ownership in the Monte Carlo
Resort
& Casino. The statistics for the Mirage Properties reflect a
full
three months and six months for the periods presented. |
Restructuring, Write-Downs and Impairments
As a result of the May 31st acquisition of Mirage Resorts, management
initiated an overall assessment of the Company�s cost structure and development
projects. Attention is being specifically focused on leveraging overall
marketing efforts and streamlining the combined operations of MGM Grand
and Mirage Resorts. As a result of these activities, net income for
the three months ended June 30, 2000 was reduced by $11.7 million (8 cents
per share) related to various restructuring charges including contract
terminations and staffing reductions. Also, management has reassessed
certain projects previously under development and is divesting certain
non-strategic assets. After-tax write-downs and impairments recognized
during the second quarter ended June 30, 2000 related to such activities
totaled $66.4 million (44 cents per share).
MGM MIRAGE is an entertainment, hotel and gaming company headquartered
in Las Vegas, Nevada, which owns and/or operates through subsidiaries 18
casino properties on three continents.
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. |
