Casino giant reports record results for first quarter

Robert Macy

Tuesday, April 18, 2000 | 9:44 a.m.

Casino giant MGM Grand Inc. couldn't start off 2000 in much better shape.

After closing a deal last month to acquire rival Mirage Resorts Inc. for $6.4 billion, MGM is now reporting record revenues, cash flow and earnings per share for the first quarter of 2000.

The company reported record net revenue of $442.9 million for the quarter ending March 31, up from $251.4 million for the same period in 1999.

And the earnings of the company doubled to an all-time high of 42 cents per share, up from 21 cents recorded for the first quarter of 1999. The figure exceeded the average estimate of 34 cents for the first quarter from analysts polled by First Call Corp.

The new figures mark the sixth consecutive quarter of better-than-expected earnings at MGM Grand and the fifth consecutive quarterly increase in revenue and operating cash flow on a year-over-year basis.

Operating cash flow (EBITDA) was also a record, $144.6 million, double the $72.7 million recorded in the first quarter of 1999.

"The MGM Grand family of properties has been defined by the quality of its assets and superior operating performance," MGM Chairman J. Terrence Lanni said in a statement announcing the results. "This is a testament to our team of the highest caliber individuals in the industry."

MGM announced earlier this month that Lanni had rejoined the company in a "full-time executive capacity" and will continue as chairman of the MGM board and its executive committee.

Lanni had been MGM's chairman but relinquished full-time executive duties in November to return to California to spend more time with his family.

He said he was coaxed back to MGM on a full-time basis because of the Mirage acquisition.

The acquisition is expected to close later this year upon approval of the Securities and Exchange Commission and state gaming agencies.

In Tuesday's report, MGM said its flagship Las Vegas resort produced its best quarterly results since the second quarter of 1996. Operating cash flow rose 32 percent to $61 million due to record table games, slot revenue and room revenue.

MGM Grand Detroit generated $35.8 million in operating cash flow on net revenue of $101.3 million.

New York-New York hotel-casino registered 44 percent operating cash flow, the highest percentage of any Las Vegas resort.