MGM MIRAGE: Stockholders pleased with annual report

LAS VEGAS - In light of the company's record-setting year, most MGM MIRAGE stockholders seemed jubilant as they walked out of Tuesday's first annual meeting since MGM Grand's buyout of Mirage Resorts.

''They hit a home run with the purchase of Mirage,'' said Andrew Kwon, a stockholder and a pharmacist from Torrance, Calif. ''Their plans for future development are most impressive.''

MGM MIRAGE is the gambling and resort company created by MGM Grand's $4.4 billion buyout of Mirage Resorts that brought the company such properties as Bellagio, Mirage and Treasure Island.

The deal, that also had MGM assume $2 billion in Mirage Resorts' debt, created a leisure industry giant that includes 14 casinos and resorts and about 1,000 acres of land for development in three states. The assets range from Mirage's $1.6 billion Bellagio resort to MGM's 5,005-room MGM Grand, the nation's largest hotel.

A Las Vegas resident for nearly 20 years, retiree Jerry Simon has been a stockholder since MGM Grand's initial offering.

''Excellent,'' he said referring to his company stock. ''They seem to have their act together.''

But not all the shareholders at the meeting were convinced.

''It's (the stock) not going anywhere until they reduce their debt,'' said longtime Las Vegan Joe Amata.

Amata was referring to the company's $18.9 million losses in the second quarter as a result of restructuring charges and other one-time expenses related to the acquisition.

Excluding the charges, earnings would have been $60.7 million, or 40 cents per share on revenues of $677.6 million. The results marked an 82 percent increase over earnings of $33.3 million, or 19 cents per share, earned by MGM Grand alone during the second quarter of 1999. MGM Grand's portion of revenues were $344.7 million.

Members of the Mystere cast, the Cirque de Soleil show at Treasure Island, greeted stockholders and performed in the EFX Theatre as part of the hour and a half meeting at the MGM Grand hotel-casino.

''The meeting was upbeat,'' said Alan Feldman, company spokesman. ''In addition to the historic acquisition of Mirage Resorts, every single property in the company performed better this year than last.''

He added that the stock prices are at an all time high. MGM MIRAGE closed at $24.94 on Tuesday.

In reporting second quarter earnings last week, company officials attributed the higher revenues to the merger as well as stronger casino income and higher hotel room volumes. For example, room revenues rose at the MGM Grand hotel-casino despite a 6 percent reduction in available rooms because of a $65 million remodeling project.

Company officials told stockholders about plans to break ground in September on a 2,000-room resort in Atlantic City, N.J. - the first new development there in 13 years.

MGM MIRAGE also plans to develop the 55-acre Boardwalk hotel-casino property on the Las Vegas Strip between the company's New York-New York and Monte Carlo properties into a resort that caters to 25- to 40-year-olds by 2004, MGM Grand Chairman Terry Lanni said.

Bobby Baldwin, chief executive of MGM Grand's Mirage subsidiary, said during a conference call to discuss earnings that the struggling Beau Rivage property in Biloxi, Miss., needs improvements, including a larger buffet and 15 percent more slot machines.

Beau Rivage received only a brief mention during the shareholders meeting.

''I'm pretty sure they can (move) it around,'' stockholder Kwon said.