MGM Mirage first quarter profit rises 17 %

Net income rose to us$ 168.2 million for the three months ended March 31 compared with us$ 144 million a year ago. Earnings from continuing operations were us$ 163 million, up from us$ 139.9 million a year ago. Analysts polled by Thomson Financial, on average, expected earnings of 63 cents per share.

Quarterly revenue after promotional allowances climbed 9 percent to us$ 1.93 billion from us$ 1.77 billion in the previous year, but missed analyst expectations of us$ 1.95 billion. Shares of MGM Mirage fell us$ 2.94, or 4.3 percent, to us$ 65.38 Thursday. In after-hours trading, shares gained us$ 1.57 to us$ 66.95. "Las Vegas Strip gaming revenue was below expectations," said analyst Robert LaFleur of Susquehanna Financial Group in a research note. "The results could raise concerns about property trends on the Las Vegas Strip."

The company said the NBA All-Star game in February, which fell on the same weekend as Chinese New Year, had a detrimental effect on normally higher table games revenue in Las Vegas. Casino revenues grew 4 percent to us$ 811.9 million for the quarter, but excluding Beau Rivage which opened in August, they slipped 6 percent, and table game revenue, including the baccarat game that many Asian players favor, slipped 7 percent.

CEO Terry Lanni said the company fared worse than competitors with operations in Macau during the important Chinese New Year, as it was less able to attract high-rolling customers from China. MGM plans to open its 50-50 joint venture casino in Macau, the us$ 1.1 billion MGM Grand Macau later this year. "We'll be on a level playing field at the end of the year," he said.

Slot revenues were down about 3 percent excluding results from Beau Rivage. The company blamed remodeling of rooms at Mandalay Bay and Excalibur in Las Vegas, which decreased room nights by about 98,000, or 3 percent of the total, during the quarter.

The company said Las Vegas Strip revenue increased to us$ 1.63 billion from us$ 1.57 billion, thanks to the continued impact of new restaurants, nightclubs and shows at several resorts. Mississippi revenue surged to us$ 142.5 million from us$ 40.9 million.

It also said sales of condos was proceeding at its us$ 7.4 billion CityCenter casino complex under construction on the Las Vegas Strip, which is set to open in late 2009. It added that it completed about us$ 1.1 billion in condo sales on expected total sales of us$ 2.7 billion just four months into an expected 30-month sales cycle.

MGM Mirage is the second biggest casino company in the world by revenue and runs 19 properties in Nevada, Mississippi and Michigan. It also has investments in three properties in Nevada, New Jersey and Illinois.