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Hard Rock Reports Loss

LAS VEGAS – (PRESS RELEASE)-- Hard Rock Hotel, Inc. ("Hard Rock"), which owns and operates the Hard Rock Hotel & Casino in Las Vegas, Nevada, today reported 1st quarter results. Net revenues increased $0.6 million, or 2%, to $34.5 million compared to $33.9 million in the year-earlier three-month period. The Company also announced a $2.2 million, or 26%, decrease in 1st quarter earnings before interest, taxes, depreciation and amortization ("EBITDA") (1), to $6.5 million compared to $8.7 million in the comparable prior year period. Net income decreased $3.9 million to a loss of $1.3 million compared to net income of $2.6 million in the 1st quarter of 2003.

Quarterly net revenues improved primarily due to increased lodging revenues partially offset by a decrease in casino revenue. Lodging revenues increased primarily due to a $24 increase in average daily rate ("ADR"). Casino revenue decreased primarily due to the table games hold percentage decreasing 1.7 percentage points to 11% compared to 12.7% in the year-earlier period. The decrease in table games hold percent was partially offset by a $6.0 million increase in table games drop of 8%, to $81.0 million compared to $75.0 million in the year-earlier three-month period.

The Company's 1st quarter EBITDA decreased primarily due to increased casino expense and an increase in marketing expense. The increase in casino and marketing expenses was primarily due to increased entertainment costs associated with the Joint and increased customer promotions. Net income also was affected by increased interest expense related to debt issued to pay $15.0 million of accrued dividends on the Company's preferred stock and interest on the $50.0 million of subordinated debt issued in exchange for the remaining preferred stock during May 2003.

Peter Morton, Hard Rock's Chairman of the Board and Chief Executive Officer, commenting on the quarterly results stated, "Our 1st quarter volume indicators were very strong. Table games drop and slot handle were both up quarter over quarter and we had the highest quarterly ADR in company history. We are looking forward to the opening of our new nightclub during the second quarter which will enhance our property and which we expect will further solidify our position in the marketplace."

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