MTR Gaming Group reports Q1 results

16 May 2007

CHESTER, West Virginia --(PRESS RELEASE) -- MTR Gaming Group, Inc. (NasdaqGS:MNTG) today announced financial results for the first quarter ended March 31, 2007.

For the first quarter, net revenues increased to $107.1 million, from $93.0 million in the same period of 2006. EBITDA was $12.5 million, compared to $14.6 million in the first quarter of 2006, due largely to $2.9 million in pre-opening costs associated with Presque Isle Downs, as well as lower revenues and profits at Mountaineer. Net income was $0.6 million or $0.02 per diluted share, compared to $3.4 million or $0.12 per diluted share in the first quarter of last year. The Company incurred higher net interest expense in the first quarter of 2007 associated with the increased borrowings for the Presque Isle Downs construction.

Net revenues at The Mountaineer Race Track & Gaming Resort were $66.5 million, compared to $71.8 million in the first quarter of 2006, and the property generated EBITDA of $13.7 million, versus $17.2 million in the comparable quarter of 2006. The property's performance was impacted by harsher weather in the '07 winter than in the '06 winter, as indicated by 13 additional canceled or abbreviated race dates in 2007 due to weather.

As previously announced, MTR opened its Presque Isle Downs & Casino on February 28, 2007. For the 32 days included in the first quarter, Presque Isle Downs generated gaming revenues of $21.1 million, an average net win per unit per day of $311, and EBITDA of $2.4 million. As noted above, EBITDA was adversely affected by $2.9 million in pre-opening expenses.

Binion's accounted for $15.1 million of net revenues in the first quarter of 2007, versus $16.5 million in the comparable period in 2006. The property experienced an EBITDA loss of $682,000 in 2007, versus EBITDA of $609,000 in the first quarter 2006. The decline in EBITDA is attributable to a $1.4 million decrease in net revenues related to softness in the overall downtown Las Vegas market. Binion's EBITDA excludes a $1.3 million one-time receipt related to an insurance company public offering distribution. The Company's Speedway Casino in North Las Vegas accounted for net revenues of $3.1 million, essentially even with the comparable period last year, and an EBITDA contribution of $569,000, compared to $820,000 in last year's first quarter. The decrease in EBITDA is primarily attributable to an increase in operating expenses. As previously announced, MTR has entered into a definitive agreement to sell the Speedway for $18,175,000 in cash. The transaction is subject to customary conditions, including the approval of the Nevada Gaming Commission and the City of North Las Vegas.

Edson R. (Ted) Arneault, President and CEO of MTR Gaming Group, stated, "We are optimistic about the prospect of adding table games at Mountaineer if Hancock County voters approve the recently passed legislation in the upcoming referendum. We believe table games could expand Mountaineer's market penetration and gaming revenues, and enhance not only Mountaineer's competitive position and further development as a destination resort but also Hancock County's development as a destination resort area."

Mr. Arneault continued, "We are extremely pleased to have substantially diversified the Company's operations with the addition of Presque Isle Downs. The property has exceeded our expectations to date. Additionally, Presque Isle's racetrack remains on-track to open in September of this year and will be the first track in Pennsylvania to offer a synthetic racing surface, which, together with competitive racing purses, promises to attract high quality race horses and full fields."

Mr. Arneault further stated, "We also continue to move forward with the other growth opportunities we have created. We recently announced Scioto Downs' launch of RacelineBet.com, a telephone and Internet wagering program, and that our North Metro Harness Initiative joint venture secured funding to develop the harness racetrack and card club in Minnesota. North Metro has broken ground on the racetrack, and we expect to open the racetrack next summer and to open the card room in the third quarter of 2008 with 50 non-banked casino card games and poker tables."

Mr. Arneault concluded, "We remain focused on enhancing the operations at each of our racetracks, racinos and casinos, as well as developing the growth opportunities we have created."