MTR Gaming Group Reports Mixed Results

8 November 2004

CHESTER, West Virginia -- (PRESS RELEASE) -- MTR Gaming Group, Inc. (Nasdaq National Market:MNTG) today announced financial results for the third quarter and nine-month period ended September 30, 2004.

Total revenues for the quarter were $85.2 million compared to $84.1 million in the third quarter of 2003. EBITDA grew by 6% to $18.6 million compared to $17.6 million in the same quarter of last year. Net income was $5.9 million or $.20 per diluted share, compared to $6.0 million or $.21 per diluted share in the third quarter of last year.

Net win from slot operations at Mountaineer remained constant at $68.6 million, producing net win-per-day-per-machine of $232 based on an average of 3,220 machines for both the current quarter and the third quarter of 2003. EBITDA at Mountaineer increased 5% to $20.6 million in the third quarter of 2004 from $19.7 million in the third quarter of 2003.

Revenues at MTR's Speedway Property in North Las Vegas increased 14% to $2.6 million in the third quarter of 2004 and the property generated $180,000 in EBITDA representing an improvement over a $78,000 loss in the same period of 2003. Binion's contributed EBITDA of $767,000 in the third quarter of 2004. Scioto Downs' revenues totaled $2.4 million and had an EBITDA loss of $249,000 for the third quarter of 2004.

Edson R. (Ted) Arneault, President and CEO of MTR Gaming Group, stated, "While traffic was strong at Mountaineer during the quarter, we believe economic conditions, high fuel prices, flooding from the hurricanes in September and, to a lesser degree, the recent proliferation of slot machines in bars, restaurants and fraternal organizations near Mountaineer affected gaming revenues at Mountaineer. Nonetheless, we continued to focus on controlling costs, which produced strong EBITDA margins at the property for the quarter."

For the first nine months of 2004, total revenues rose 9% to $244.0 million, while EBITDA increased 10% to $45.5 million. Net income was $11.9 million or $.41 per diluted share, compared to $12.9 million and $.45 per diluted share for the same period in 2003. The results for the first nine months of 2003 included a net $432,000 gain on the sale of property, whereas the 2004 period included a $45,000 loss.

Net win at Mountaineer rose 8% to $200.9 million during the first nine months of 2004, producing net win-per-day-per-machine of $228 based on an average of 3,220 machines for the current period, compared to $220 with an average of 3,112 machines in the 2003 period. EBITDA at Mountaineer increased 10% to $51.2 million in the first nine months of 2004 from $46.7 million in nine-month period of 2003.

Revenues at the Company's Speedway Property in North Las Vegas increased 12% to $7.9 million for the first nine months of 2004 and the property generated $666,000 in EBITDA compared to essentially breaking even in the same period of 2003. Binion's contributed EBITDA of $1.6 million in the nine-month period of 2004. Scioto Downs' operations generated revenues of $5.3 million and had an EBITDA loss of $1.3 million for the first nine months of 2004.

Development Updates

-The Company has received notification that Harrah's does not intend to extend the Joint Operating Agreement for another year. Accordingly, the agreement will expire by its own terms on March 11, 2005, at which time MTR will begin operating Binion's. During the period from the April 1, 2004 reopening date through September 30, 2004, while Binion's was being operated by Harrah's, the property generated revenues of $34.0 million and EBITDA of $1.8 million. This excludes entry fees and other direct revenue from the World Series of Poker® and payments made to MTR under the Joint Operating Agreement. MTR anticipates that Binion's will represent a significant diversification of the Company's revenue base. The final two tables of the 2005 World Series of Poker® will take place at Binion's in accordance with the Joint Operating Agreement.

-The Company is pursuing its project development efforts in West Virginia, Pennsylvania, Minnesota, Michigan and Ohio, including supporting gaming legislative initiatives and pursuing judicial remedies where necessary.

"We continue to pursue prudent development opportunities that leverage our knowledge and expertise in the gaming and racino markets. While the cost of exploring these opportunities may burden near-term results from time to time, we believe our attractive entry costs will provide significant long-term value for our shareholders," concluded Mr. Arneault.

Financial Guidance

Due to current business trends, for the fourth quarter of 2004, the Company expects total revenues of $71.0-$73.0 million, EBITDA of $11.5-$12.5 million and net income of $1.1-$1.5 million. This will produce total revenues of $315.0-$317.0 million, EBITDA of $57-$58 million and net income of $13.0-$13.4 million for fiscal year 2004. The Company's guidance assumes that (i) there will be no material new competition; (ii) the Commonwealth Court's decision upholding Presque Isle Downs' license will not be overturned; and (iii) no material changes in economic conditions, West Virginia gaming or tax laws or world events; and is subject to recoverability of certain costs in the event the Company obtains regulatory approval to relocate Presque Isle Downs and determines to do so and in the event the Company is unable to move forward with plans in Minnesota and Michigan.