MGM Grand, Inc. (NYSE: MGG) today
reported earnings for the third quarter ended September 30, 1998 of 31 cents
per diluted share, compared with 25 cents per diluted share for the 1997
quarter.  Net income for the 1998 third quarter was $17.1 million compared
with $14.5 million in the prior year`s quarter.  Before one-time charges and
extraordinary items, the 1997 third quarter net income was $37.1 million, or
63 cents per diluted share.  The 1997 third quarter earnings benefited from
the reversal of previously expensed costs totaling $3.8 million (after tax),
or 7 cents per diluted share.

Net revenues for the 1998 period were down 7.1% to $193.7 million,
compared with $208.4 million for the same period in 1997.  The lower 1998
third quarter earnings and net revenues were affected by higher non-operating
expenses, lower than average table games hold percentage at MGM Grand Las
Vegas when compared with an above average hold percentage during the prior
year`s third quarter, and lower results from the Company`s 50% interest in New
York - New York Hotel/Casino.  The hold percentage differential between the
1998 period and the 1997 period equates to $14.7 million of operating cash
flow (EBITDA), or earnings of 17 cents per diluted share.  Partially
offsetting these factors was a notable improvement in non-gaming operations,
reflecting strategic initiatives implemented throughout the year to boost
revenue and reduce non-productive costs.  As a result, room, food and
beverage, entertainment, retail and other revenues climbed 6.3% with improved
operating margins.  Table games and slot volume increased year-over-year,
further indicating strong customer demand.

Operating cash flow (EBITDA) for the three months ended September 30, 1998
was $55.5 million, representing an operating margin of 28.7% when compared
with $72.7 million in the prior year`s third quarter (before one-time
charges).

“Our Master Plan project began in mid-1996.  Completion of our City of
Entertainment transformation is now only several months away as we eagerly
anticipate the opening of the MGM Grand Mansion and the Lion Habitat in early
1999,” said J. Terrence Lanni, Chairman and Chief Executive Officer of MGM
Grand, Inc.

“Using a normalized hold percentage, our operating margin for the quarter
would have been an impressive 30%,” said Alex Yemenidjian, President and Chief
Operating Officer of MGM Grand, Inc.

As part of the Company`s program to purchase an aggregate 12,000,000
shares of common stock, the Company completed its acquisition of 6,000,000
shares at $35 per share during the 1998 third quarter.  The Company
anticipates that, depending on market conditions, the remaining 6,000,000
shares in the repurchase program may be acquired in the open market, in
private transactions, through a tender offer or offers or otherwise.  The
Company may in the future also repurchase common stock outside of the
repurchase program in the open market, in private transactions, through tender
offers or otherwise, although no such purchases are presently contemplated.

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