No Vegas Luck at MGM Mirage

Updated from 10:40 a.m. EDT

While MGM Mirage(MGM Quote - Cramer on MGM - Stock Picks) reported an 18% rise in third-quarter earnings, the results in its core Las Vegas market were tepid at best.

The casino operator earned $183.9 million, or 62 cents a share, in the third quarter, compared with $156.3 million, or 54 cents a share, a year earlier. Analysts expected a profit of 50 cents a share, according to Thomson Financial, though it's not clear if that is directly comparable to MGM's figures.

MGM's profits benefited from insurance recoveries related to Hurricane Katrina damage at its Mississippi casinos, which added 24 cents to EPS.

Net revenue increased 6% to $1.9 billion, matching analysts' expectation.

The results were boosted by MGM's Beau Rivage casino in Mississippi. Beau Rivage was open for a full quarter, compared with just 33 days a year in last year's third quarter.

While the company did not break out specific revenue growth at Beau Rivage, it did say that its net revenue would have increased only 2% at its properties excluding Beau Rivage.

Gaming revenue increased 3% across the portfolio but decreased 3% excluding Beau Rivage.

On the Las Vegas Strip, where MGM is the largest owner of casinos, property EBITDA fell 3.5% to $469.6 million. EBITDA, or earnings before interest, taxes, depreciation and amortization, is a proxy for cash flow and is a commonly used performance metric in the casino industry.

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