MGM Grand, Inc. (NYSE: MGG) today
announced that, based on current trends, it anticipates first quarter earnings
per share to be below expectations, due to an unusually low gaming hold
percentage at MGM Grand Las Vegas and to lower earnings at the Company`s 50%
owned New York-New York Hotel and Casino. Management now expects earnings in
a range of $0.25 to $0.35 per share.
The earnings shortfall is principally due to a below average hold
percentage in table games at MGM Grand Las Vegas during the first two months
of 1998. The unusually low table hold percentage, particularly in baccarat,
translates into an approximate $0.15 per share shortfall compared to
historical averages. The Company continues to maintain strong occupancy and
room rates at MGM Grand Las Vegas - “The City of Entertainment,” and continues
to recognize strong slot volume which includes activity from the new
The Company also anticipates a reduction in revenue at its 50% owned New
York-New York Hotel and Casino during the first quarter of 1998 when compared
with the first quarter of 1997. The 1997 quarter was one the most successful
openings of any hotel/casino resort in the history of Las Vegas. The
reduction at New York-New York is anticipated to be partially offset by
stronger results at MGM Grand Australia on a quarterly year over year basis.
“The results in early 1998 obscure the material improvements at the MGM
Grand Hotel/Casino as we transform the property into The City of
Entertainment. Our casino renovation is substantially complete, and this has
led to higher customer satisfaction and demand as evidenced by our strong slot
play. This momentum is likely to continue as we open our state-of-the-art
conference center in April, our pool and spa complex in June, and the MGM
Grand Mansion in December,” said J. Terrence Lanni, Chairman and Chief
Executive Officer of MGM Grand, Inc.
“We are very excited about the future growth of our Company. Our flagship
property in Las Vegas, luck factor excluded, continues to enjoy strong demand.
We are progressing with the development of a hotel/casino and entertainment
complex in Detroit, Michigan, and plan to construct a hotel/casino resort in
Atlantic City, New Jersey. MGM Grand and its partners have been awarded three
gaming licenses in the Republic of South Africa, while the MGM Grand
Hotel/Casino in Darwin, Australia is performing above expectations,” said Alex
Yemenidjian, President and Chief Operating Officer.
MGM Grand, Inc. is an entertainment, hotel and gaming company
headquartered in Las Vegas, Nevada. The Company owns and operates the MGM
Grand Hotel/Casino in Las Vegas, the MGM Grand Hotel/Casino in Darwin,
Australia, owns a 50% interest in New York - New York Hotel and Casino in Las
Vegas and manages a casino in Nelspruit, South Africa. The Company is also
planning to construct destination hotel/casino resorts in Atlantic City, New
Jersey and Detroit, Michigan.
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 described in the Company`s Annual Report on Form 10-K for the
fiscal year ended December 31, 1996.