MGM MIRAGE Reports Second Quarter Results
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MGM MIRAGE Reports Second Quarter Results
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Category: Worldwide - Industry economy -
Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2008-08-07
MGM MIRAGE (NYSE: MGM) today reported its second quarter 2008 financial results. The Company achieved 97% occupancy at its Las Vegas Strip resorts, while company-wide net revenue declined 2%. The Company earned $0.40 per diluted share from continuing operations in the 2008 second quarter, compared to $0.62 in the prior year second quarter. The 2007 quarter included $63 million, or $0.14 per diluted share net of tax, of residential sales at The Signature at MGM Grand. The 2008 quarter includes $19 million, or $0.04 per diluted share net of tax, of insurance recovery income related to the Monte Carlo fire.
Overall trends were similar to those experienced in the first quarter of 2008 -- guests continued to visit the Company's resorts in high numbers, but at lower room rates, and current economic conditions led to lower visitor spending. Gaming revenues were impacted slightly more than non-gaming revenues, with the Company experiencing a 4% decline in gaming revenues on a quarter-over-quarter basis. Net non-gaming revenues were flat as relative strength in food and beverage and entertainment revenue offset lower revenue in rooms and retail. The Company also notes that results at its regional properties in Mississippi and Michigan improved compared to first quarter performance and exceeded 2007 results.
Key results for the quarter include:
-- Net revenue decreased 2% to $1.9 billion;
-- Las Vegas Strip REVPAR(1) decreased 5%; occupancy was 97% at the
Company's Las Vegas Strip resorts versus 98% a year ago;
-- Casino revenue decreased 4%, mainly as result of lower table games
volume at the Company's Las Vegas Strip resorts and a 10% decline in
Las Vegas Strip slots revenue, offset by increased slots revenue at
the larger MGM Grand Detroit and increases at Beau Rivage and Gold
Strike Tunica;
-- Property EBITDA(2) decreased 12% on a comparable basis, after removing
the impact of the prior year residential profits and current year
insurance recoveries. On an absolute basis, Property EBITDA was $564
million in the 2008 quarter, an 18% decrease from the prior year;
-- Bellagio and Mandalay Bay reported increases in Property EBITDA, with
Bellagio reporting its highest ever quarterly hotel revenue and
leading the Las Vegas market in Property EBITDA; Mandalay Bay produced
a record for second quarter EBITDA.
The following table lists certain items which affect the comparability of the current year and prior year quarterly results (earnings per share impact shown, net of tax, per diluted share; negative amounts represent charges to income):
Three months ended June 30, 2008 2007
--------------------------- ------ ------
Profits from The Signature at MGM Grand $ - $ 0.14
Preopening and start-up expenses (0.02) (0.03)
Monte Carlo fire business interruption
(recorded as a reduction of general
and administrative expenses) 0.02 -
Property transactions, net:
Monte Carlo fire property damage insurance 0.02 -
Other property transactions (0.02) (0.01)
"Our resorts were near capacity and we believe our market share increased, as discriminating customers seek the best resort and entertainment experiences," said Terry Lanni, Chairman and CEO of MGM MIRAGE. "Our track record of successfully navigating through changing economic conditions is solid and is reinforced by our results this quarter."
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