LAS VEGAS, Nov. 20 /PRNewswire/ -- Mandalay Resort Group (NYSE: MBG) today announced results for its third quarter ended October 31, 2001. For the quarter, the company reported earnings per share of $.32 against $.38 a year ago, including a small preopening charge in the recent quarter. Prior to September 11, the company expected its earnings per share in the third quarter to exceed $.50. The events of September 11 caused a distinct falloff in visitor traffic to the Las Vegas Strip for the greater part of the quarter, largely during the weekday periods.
Mandalay Bay generated operating cash flow (EBITDA) of $30.0 million in the quarter, versus $30.5 million in the year-prior quarter. The property experienced a higher hold or win percentage on table games compared with a subpar performance in last year's third quarter. (With a 'normalized' hold percentage in the respective quarters, estimated results for the company would have been $.30 in diluted earnings per share against $.42 last year on the same operating basis.) Luxor posted $27.0 million compared with $32.6 million, while operating cash flow at Excalibur was $21.1 million versus $24.3 million. For its part, Circus Circus-Las Vegas reported $14.7 million in operating cash flow against $17.4 million, and Monte Carlo, which is 50% owned by Mandalay, turned in $19.6 million against $25.1 million. In the quarter, the company's average room rate across its Las Vegas properties held steady, while their combined occupancy rate fell to 84% versus 95% in the same quarter last year.
In Reno, the company recorded a total of $13.6 million versus $14.3 million in operating cash flow, and in Laughlin, the company's two properties posted $4.4 million against $5.3 million in the third quarter a year ago. The Gold Strike in Tunica County, Mississippi, made $5.6 million versus $8.1 million in operating cash flow. The Tunica market continued to face a slump, apart from September 11.
The company's properties in Jean, Nevada (Gold Strike and Nevada Landing) reported operating cash flow of $0.7 million, down from $3.4 million in the third quarter a year ago. The impact of expanded Native American casinos in California combined with the events of September 11 contributed to the decline.
In Elgin, Illinois the company's 50% owned casino vessel, Grand Victoria, turned in $33.5 million in operating cash flow versus $30.9 million. And in Detroit, MotorCity Casino (53.5% owned by Mandalay) generated $29.5 million in operating cash flow against $26.3 million in the year-ago quarter, as the property improved its market share of slot machine revenue.
For the three quarters of the fiscal year, Mandalay has earned $516.5 million in operating cash flow against $546.2 million over the same period last year. For the third quarter, the company's operating cash flow was $152.6 million against $171.1 million.
For the fourth quarter (ending January 31, 2002), the company indicated that it would report a per share loss. The fourth quarter has historically been the low quarter for the company. Visitor counts to the Las Vegas Strip remain subnormal during the weekdays, and the New Year's period looks to be weaker than the historical pattern, given the aftermath of September 11. Last year Mandalay earned $.04 per share in the fourth quarter. But the company noted that it will resume construction of its 1.2 million square-foot convention center at Mandalay Bay in the first quarter next year, to have it ready by the beginning of 2003.
Mandalay Resort Group owns and operates 11 properties in Nevada: Mandalay Bay, Luxor, Excalibur, Circus Circus, and Slots-A-Fun in Las Vegas; Circus Circus-Reno; Colorado Belle and Edgewater in Laughlin; Gold Strike and Nevada Landing in Jean and Railroad Pass in Henderson. The company also owns and operates Gold Strike, a hotel/casino in Tunica County, Mississippi. The company owns a 50% interest in Silver Legacy in Reno, and owns a 50% interest in and operates Monte Carlo in Las Vegas. In addition, the company owns a 50% interest in and operates Grand Victoria, a riverboat in Elgin, Illinois, and owns a 53.5% interest in and operates MotorCity in Detroit, Michigan.
This press release contains forward-looking statements within the meaning of the federal securities law, including statements concerning anticipated results for the fourth quarter. The forward-looking statements in this press release involve risks and uncertainties which could cause actual results to differ materially from those expressed in or implied by the statements herein, including, but not limited to the impact of potential future terrorist attacks. Additional information concerning potential factors that could affect the company's future financial results is included in the company's annual report on Form 10-K for the year ended January 31, 2001, and its quarterly reports on Form 10-Q for the periods ended April 30, 2001 and July 31, 2001.
MANDALAY RESORT GROUP
Condensed Consolidated Statements of Income
(Dollars in thousands, except share data)
(UNAUDITED)
Three Months Ended Nine Months Ended
October 31, October 31,
2001 2000 2001 2000
Revenues $609,365 $630,813 $1,922,640 $1,903,938
Costs and expenses 508,124 516,732 1,571,266 1,537,160
Preopening expense 892 -- 1,381 1,832
Income from operations 100,349 114,081 349,993 364,946
Interest expense (56,797) (62,414) (171,472) (170,287)
Other income 995 1,652 1,901 5,946
Minority interest (8,170) (6,088) (20,442) (14,328)
Income before income tax 36,377 47,231 159,980 186,277
Income tax expense 13,066 17,860 58,780 69,996
Net income $23,311 $29,371 $101,200 $116,281
Basic earnings
per share $0.33 $0.39 $1.38 $1.47
Diluted earnings
per share $0.32 $0.38 $1.35 $1.45
Average shares
outstanding (basic) 70,421,426 76,027,729 73,493,086 79,027,654
Average shares
outstanding (diluted) 71,745,131 77,757,880 75,114,176 80,420,801
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