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NASDAQ: MNTG

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Title: NASDAQ: MNTG


1
  • NASDAQ MNTG
  • A Leading Developer and Operator of Gaming
    Properties in Evolving Middle Markets

SIDOTI COMPANY 5TH ANNUAL PALM BEACH
CONFERENCE January 22, 2008
2
In addition to historical facts or statements of
current condition, this presentation contains
forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Some of these
statements are those regarding our prospects for
future growth. These statements are subject to a
number of risks and uncertainties that could
cause the statements made to be incorrect and the
actual results to differ materially. The Company
describes certain of these risks and
uncertainties in its filings with the Securities
and Exchange Commission, including its Annual
Report on Form 10-K for the fiscal year ended
December 31, 2006. Some of these risks include
those relating to regulatory approvals,
availability of financing sources, development
and construction activities, costs and delays,
weather, permits, competition and business
conditions in the gaming industry. Furthermore,
the Company does not intend to update publicly
any forward-looking statements, except as may be
required by law. The cautionary advice in this
paragraph is permitted by the Private Securities
Litigation Reform Act of 1995.
3
COMPANY OVERVIEW
  • Diversified gaming operator with primary focus on
    middle-market properties
  • Currently operate in WV, PA, OH, MI and NV
  • Total slots 5,608
  • Table games 56
  • Poker tables 39
  • Hotel rooms 454
  • Restaurants 22
  • Employees 3,300
  • Instrumental in securing favorable new gaming
    legislation in states in which MTR operates,
    including table games in WV
  • Fiscal 06 net revenues of 372.8 mm and EBITDA
    of 48.6 mm first nine months of 07 net
    revenues of 373.2 mm and EBITDA of 43.8 mm
  • 2008 CapEx spending is estimated at less than 25
    mm, absent customer demand for a significant
    project (e.g. parking garage or hotel expansion
    at Mountaineer).

4
INVESTMENT HIGHLIGHTS
  • Proven ability to successfully develop and
    operate middle-market gaming properties
  • Key growth drivers new properties, expanded
    gaming and the potential for additional expanded
    gaming
  • Presque Isle Downs Casino Erie, PA
  • Casino opened 2/28/07 with 2,000 slots
  • Pari-mutuel wagering commenced on July 27, 2007
  • A state-of the art thoroughbred racetrack opened
    9/01/07
  • Mountaineer opened 37 poker tables on October
    19, 2007 and approximately 50 table games on
    December 20, 2007
  • Construction of harness track and card room in MN
    (50 ownership) harness track expected to open
    in mid-Q208 and card room expected to open in
    Q308
  • Potential for gaming legislation authorizing
    slots in Michigan, Ohio and Minnesota

5
STRATEGIC LOCATIONS
6
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
7
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • History
  • Current management assumed responsibility for the
    property in 1995
  • Instrumental in legalization of slots in WV
    (1994) and in legalization of table games in WV
    (2007)
  • Gradually built-up the property, added resort
    amenities and increased the number and types of
    slots

8
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • Now
  • Destination hotel, convention and resort facility
  • 3,220 slots (approximately 90
    ticket-in-ticket-out) 37 poker tables opened on
    October 19, 2007, and approximately 50 table
    games opened on December 20, 2007
  • Thoroughbred horse racing simulcasting
  • Sole WV racetrack authorized to position slots
    away from the track
  • 2006 net revenues of 292.3 mm and EBITDA of
    67.7 mm first nine months of 07 net revenues
    of 201.5 mm and EBITDA of 38.5 mm
  • 2006 ADR was 71.22 occupancy was 73.3 average
    win/slot/day was 221. For the first nine months
    of 07, ADR was 63.83 occupancy was 77.6
    average win/slot/day was 201

Regulatory approval for up to 3,500, with no
legislative ceiling
9
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • Stables
  • Hold 1,200 horses
  • year-round
  • Year-round
  • Thoroughbred
  • Race Track,
  • Clubhouse
  • Grandstand
  • 1 mile dirt track
  • 7 furlong turf track
  • 450 slots
  • Import export simulcasting
  • 37 poker tables
  • Fitness
  • Center
  • 12,000 sq. ft
  • Tennis courts
  • Hotel,
  • Gaming, Convention Center Spa
  • 359 hotel rooms
  • 2,770 slots
  • 50 table games
  • 11,866 sq ft
  • convention ctr
  • Indoor and
  • outdoor pools
  • The Harv
  • 69,000 sq. ft.
  • theater events center hosting top performers
  • Fine dining and entertainment throughout
  • Golf course 8 miles away

10
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • Strong demographics
  • 6.2 mm adults within a 2-hour drive
  • 2.6 million adults within 50 miles
  • 40 miles south of Youngstown 100 miles south of
    Cleveland 35 miles west of Pittsburgh 140 miles
    south of Erie

11
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • Competitive position
  • 1 of 4 legislatively authorized WV racinos
  • Nearest competition is 40 miles away
    approximately 1,400 limited video lottery (LVL)
    machines in surrounding counties (local bars are
    allowed up to 5 LVLs, and fraternal organizations
    are allowed up to 10 LVLs)
  • 66 of customers from OH 30 from PA 2 from WV
  • Approximately 2,350-acre landholding, with only
    385 acres currently developed 2.9 miles of Ohio
    River frontage

12
MOUNTAINEER CASINO, RACETRACK RESORT CHESTER,
WV
  • Growth opportunities
  • Table games opened on December 20, 2007
  • Initially 50 tables roulette, craps and
    blackjack -- with no statutory limit on bets and
    number of games
  • Initially, four pits in the Hotel Speakeasy
    Casino (21,800 square feet), with a fifth pit to
    open in the Grandstand in the near future
  • Will draw new customers, increase business from
    existing customers, improve competitive position
  • 9,900 square feet River Poker Room opened on
    October 19, 2007, with 37 tables and 4 additional
    poker tables in the near future
  • Casino is now open 24 hours a day

13
PRESQUE ISLE DOWNS ERIE, PA
14
PRESQUE ISLE DOWNS ERIE, PA
  • 2/28/07 opened 140,000 sq ft Clubhouse with
    gaming
  • 2,000 slots (100 TITO), including 9 electronic
    BJ games and 4 electronic roulette games
  • Fine and casual dining bars
  • Between 2/28/07 and 12/30/07, average
    win/slot/day was
  • 231 generated 141.4 mm in gaming revenues
  • A state-of the art thoroughbred racetrack
    opened 9/01/07, with
  • racing in 2008 scheduled from May 9 to
    September 27
  • 272-acre site, with 58 acres of open space

Authorized for 3,000 slots
15
PRESQUE ISLE DOWNS ERIE, PA
  • Attractive demographics
  • Approximately 3,000 hotel rooms in the Erie area
  • Excellent highway access
  • 0.5 mm adults w/in 50 miles
  • 2.2 mm adults w/in 90 miles
  • Nearest competition is 75 miles away

16
SCIOTO DOWNS COLUMBUS, OH
  • Harness horse racing facility with pari-mutuel
    wagering, year-round simulcasting, live racing
    (May Sept, 80 days) acquired in 2003
  • 5 miles from downtown Columbus easy access from
    I-70 I-71
  • 1.6 mm adults within 50 miles 3.2 mm within 90
    miles
  • 2006 net revenues of 5.5 mm EBITDA of (4.1
    mm), including
  • 3.1 mm spent in support of a slot referendum
    in Ohio first nine
  • months 07 net revenues of 3.7 mm and
    EBITDA of (1.4 mm)
  • 208-acre site could be developed into
    destination resort
  • Potential for slot legislation

17
JACKSON HARNESS RACEWAY JACKSON, MI
  • 90 interest in Jackson Harness Raceway acquired
    in 2005 for 2 mm
  • Live harness racing (April - July, 36 days) at
    Jackson County Fairgrounds
  • Year-round simulcasting
  • Pari-mutuel wagering
  • Casual dining
  • About 35 miles from Lansing 40 miles from Ann
    Arbor 70 miles from Detroit and 70 miles from
    Toledo, OH
  • 2006 net revenues of 3.2 mm EBITDA of
    (328,000) first nine months of 07 net revenues
    of 2.5 mm and EBITDA of (397,000)
  • Potential for slot legislation if favorable
    gaming legislation is passed, MTRs ownership
    interest would decrease to 80

18
PROPERTY UNDER DEVELOPMENT RUNNING ACES HARNESS
PARK MINNEAPOLIS, MN
19
PROPERTY UNDER DEVELOPMENT RUNNING ACES HARNESS
PARK MINNEAPOLIS, MN
  • 50 interest in JV with Southwest Casino Hotel
  • First harness racetrack in MN second racetrack
    in Minneapolis area
  • No additional racetracks or card rooms permitted
    in Minneapolis-St.Paul metropolitan area
  • 30 miles northeast of downtown Minneapolis 40
    miles from the Mall of America
  • Population approx. 3.2 mm

20
PROPERTY UNDER DEVELOPMENT RUNNING ACES HARNESS
PARK MINNEAPOLIS, MN
  • Licensed to open card room after tracks first
    50-day live race meet and regulatory approval of
    plan of operation
  • Harness track expected to open in mid-Q208 and
    card room expected to open in Q308 with 50
    tables offering non-banked games (casino card
    games poker)
  • MTRs expected investment through 2007
    approximately 12.5 mm
  • Non-recourse construction financing of
    approximately 42 mm total development cost of
    approx. 63 mm
  • Peer Canterbury Park Racetrack Card Club
  • 2006 revenues of 56.1 mm EBITDA of 7.0 mm
  • Mystic Lake and Little Six (Indian) casinos
    located within 5 miles of Canterbury Park
  • Potential for slot legislation

21
PROPERTY BEING SOLDBINIONS GAMBLING HALL
HOTEL
  • Acquired assets for 22 mm in 2004
  • 800 slots, 47 tables, 35 poker tables, 365 hotel
    rooms
  • June 07 definitive agreement to sell Binions
    for 32 mm in cash to TLC Casino Enterprises
  • Subject to obtaining governmental approvals,
    other customary conditions, and certain purchase
    price adjustments
  • Reflected as an asset held for sale on MTRs
    financial statements

Excluding a 5 mm claim by Harrahs, which MTR
is disputing but which MTR has fully accrued
22
PROPERTY BEING SOLDSPEEDWAY CASINO
  • Acquired in May 98 for 5.6 mm
  • Total asset value (excluding cash) as of
    12/31/06 10.7 mm
  • 2006 net revenues of 12.0 mm and EBITDA of 2.5
    mm first nine months of 07 net revenues of 8.4
    mm and EBITDA of 1.2 mm
  • Jan. 08 sold the real estate for 11.4 mm
  • Jan. 08 agreement to sell the Speedway assets
    for 6.775 mm, with 4.775 mm contingent on
    future revenue
  • Subject to obtaining governmental approvals and
    other customary conditions

23
STRONG HISTORICAL RESULTS
(Dollars in millions)
TOTAL REVENUES EBITDA
  • EBITDA in 05 and 06 reflects the carrying
    costs of MTRs growth
  • initiatives

The financial results in the above charts include
Binion's. Definition and reconciliation of
EBITDA included in later slides
24
SUMMARY TAX INFORMATION
  • West Virginia
  • Slots
  • Effective rate 56.8
  • Based on 55.4 of the first 160 million of slot
    revenue, and 59.7 of the excess
  • Table games
  • Effective rate 38-40
  • Based on State rate of 35 plus 2.5 million
    annual license fee
  • Pennsylvania slots
  • Effective rate 58-60
  • Based on State rate of 55 plus a minimum tax of
    the greater of 2 or 10 million for the
    municipal/county

25
OVERVIEW OF CAPITAL STRUCTURE
  • Common Stock Outstanding 27.6 mm shares
  • 9.75 Senior Notes due 2010 130 mm
  • Redeemable on or after April 1, 2007, at
    specified redemption prices
  • 9 Senior Subordinated Notes due 2012 125 mm
  • Redeemable on or after June 1, 2009, at specified
    redemption prices
  • Senior Secured Revolving Credit Facility 155
    mm
  • As of November 7, 2007, MTR had drawn 141 mm and
    had issued 1.5 mm in letters of credit under
    this Facility

26
SUMMARY
  • Proven ability to successfully develop and
    operate middle-market gaming properties
  • Mountaineer solid base business, exciting upside
    potential with the addition of table games
  • Presque Isle Downs Casino represents major
    diversification
  • Key growth drivers new properties the
    potential for expanded gaming at existing/new
    properties
  • Pari-mutuel wagering commenced on July 27, 2007,
    and racing on September 1, 2007, at Presque Isle
    Downs Casino
  • Poker operation commenced on October 19, 2007,
    and table games commenced on December 20, 2007,
    at Mountaineer
  • Harness track and card room in Minneapolis
  • Potential for slots legislation in Michigan,
    Minnesota and Ohio

27
RECONCILIATION OF NET INCOME TO EBITDA
  • EBITDA represents earnings (losses) before
    interest, income tax expense (benefit),
    depreciation and amortization, equity in loss of
    unconsolidated joint venture and (gain) loss on
    disposal of property. EBITDA is not a measure of
    performance or liquidity calculated in accordance
    with generally accepted accounting principles
    (GAAP), is unaudited and should not be
    considered an alternative to, or more meaningful
    than, net income or income from operations as an
    indicator of our operating performance, or cash
    flows from operating activities, as a measure of
    liquidity. EBITDA has been presented as a
    supplemental disclosure because it is a widely
    used measure of performance and basis for
    valuation of companies in our industry. Uses of
    cash flows that are not reflected in EBITDA
    include capital expenditures (which are
    significant given our expansion), interest
    payments, income taxes, and debt principal
    repayments. Moreover, other companies that
    provide EBITDA information may calculate EBITDA
    differently than we do. A reconciliation of GAAP
    operating income to EBITDA is included in the
    financial table on the next slide.

28
RECONCILIATION OF NET INCOME TO EBITDA
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