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Inn of the Mountain Gods Resort Reports Q1

3 November 2005

MESCALERO, New Mexico -- (PRESS RELEASE) -- Inn of the Mountain Gods Resort and Casino ("IMGRC"), a business enterprise of the Mescalero Apache Tribe (the "Tribe"), reported today net revenue for the quarter ended July 31, 2005 was $30.6 million, an increase of $8.5 million, or 38%, from $22.1 million for the quarter ended July 31, 2004. EBITDA for the quarter ended July 31, 2005, was $5.5 million, a decrease of $2.2 million or 29%, from $7.7 million for the quarter ended July 31, 2004. Net loss for the quarter was $5.7 million compared to net income of $3.5 million for the quarter ended July 31, 2004.

Increases in revenue were primarily attributable to increased gaming, hotel and food and beverage revenues associated with opening IMGRC's new resort in March 2005. Gaming revenues increased $4.4 million, from $17.6 million for the quarter ended July 31, 2004, to $22.0 million for the quarter ended July 31, 2005. Hotel revenues were $2.9 million for the quarter ended July 31, 2005 compared to $0 million for the quarter ended July 31, 2004, when IMGRC did not have an operating hotel. Food and beverage revenues were $3.5 million for the quarter ended July 31, 2005 compared to $1.4 million for the quarter ended July 31, 2004. The increase in food and beverage revenue is primarily due to the opening of the fine dining, buffet, sports bar and other food and beverage outlets in the new resort. Total operating expenses in the quarter ended July 31, 2005 were $29.6 million compared to $16.0 million for the quarter ended July 31, 2004, largely due to increased expenses associated with operating the new resort. Results for the first quarter ended July 31, 2004 reflect $1.1 million of pre-opening costs and expenses, which were not present in the quarter ended July 31, 2005.

Brian Parrish, Chief Operating Officer of IMGRC, stated: "We are pleased with our revenues during the first quarter of 2006, which reflect our first full quarter of operations following the opening of our new resort. In an effort to improve revenue going forward, we plan to increase traffic though a comprehensive marketing plan focused on highlighting all the amenities of our luxury all-season resort, which recently received the prestigious Four Diamond Award from AAA. Our first quarter results reflect certain expenses attributable with opening our resort in March, including increased staffing and training. In addition, following the closing of our first quarter, we identified several areas where we will seek to improve operating efficiencies and reduce expenses, including improving efficiency and utilization of existing team members, adjustments to staffing levels, inventory control, general and administrative costs and food and beverage costs. We are very excited about our new resort and are looking forward to the future."

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