Tuesday, March 3, 2009 | 10:16 a.m.
My Fellow MGM MIRAGE Employees:
As you may have seen in news reports over the past several days, we have made some financial moves in order to protect and strengthen our company’s financial position. Last week, we drew down the remaining funds on our credit facility to bring our total cash balance to over $1 billion. Additionally, today we filed with the Securities and Exchange Commission notification of a delay in filing our 2008 Form 10-K, to a date no later than March 17, 2009.
In addition, today’s filing noted that we consider it likely that our auditors’ report on our 2008 financial statements will contain an explanatory paragraph concerning our ability to continue our business as a “going concern.” This is a term of art utilized by auditors. I want to be clear: This in no way reflects an assessment of the quality or soundness of our underlying business and properties, which remain world class and are enjoyed by thousands of guests every day. Rather, the challenges we face are primarily related to the financial structure of our debt. Like many companies around the world, and in the gaming industry in particular, access to capital has been limited due to turmoil in the financial markets and the global economic recession. We believe these factors are contributing to the auditors’ evaluation of our current financial position. To put this into perspective, several companies here in Las Vegas, and many others around the country, are receiving similar assessments from their auditors.
MGM MIRAGE is engaged in ongoing discussions with its lenders in order to address our financial position. We are exploring a number of options and are committed to finding the best possible solution. The economic environment in which we operate is always changing, and we will work through this period as we always have in the past. In the meantime, we are continuing to operate our properties and deliver the service and experience that our guests and clients have come to expect.
This announcement may lead to increased questions about our company from customers and business partners and will also undoubtedly lead to speculation about our company’s financial health in the media. It is extremely important we speak with one voice on this matter so as to attempt to avoid any confusion or misinformation. If you receive any inquiries from the media or other interested third parties, please refer them to the Public Affairs Department at 702-650-6947.
Our daily operations are continuing as always. Our operations, while impacted by the downturn in the national economy, remain profitable. It is more important than ever that you remain focused on what matters most – serving our guests and clients with the professionalism and service they have come to expect from MGM MIRAGE.
We will keep you as informed as possible throughout this process and thank you all for your continued hard work and dedication.
James J. Murren
Chief Executive Officer & Chairman of The Board