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2006 Bank of America Gaming Conference

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Title: 2006 Bank of America Gaming Conference


1
2006 Bank of America Gaming Conference June 29,
2006 Las Vegas, NV Presented by Peter J.
Roberti, Vice President of Corporate Finance
2
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5
Disclosure Regarding Forward-Looking Statements
  • Some information included in this presentation
    are not strictly historical in nature and involve
    important risks and uncertainties that could
    significantly affect anticipated results in the
    future. Such statements are forward-looking
    statements, within the meaning of Section 27A of
    the Securities Act of 1933 and Section 21E of the
    Securities Exchange Act of 1934. These
    forward-looking statements are only predictions
    and actual events or results may differ
    materially from any forward-looking statements
    made during this presentation.
  • Factors that could cause actual results to vary
    from these forward-looking statements are more
    fully described in our Annual Report on Form
    10-K, as filed with the Securities and Exchange
    Commission, for the fiscal year ended September
    30, 2005, under the heading Risk Factors.
    Forward-looking statements made during this
    presentation represent the Authoritys current
    outlook only as of todays date. The Authority
    does not undertake any obligation to update or
    supplement any forward-looking statements to
    reflect subsequent events or circumstances. The
    Authority cannot assure you that projected
    results will be achieved or that predicted events
    will occur.

6
Disclosure Regarding Non-GAAP Measures
  • The following presentation includes certain
    financial measures of performance that are not
    calculated in accordance with accounting
    principles generally accepted in the United
    States of America, or GAAP. In accordance with
    the rules of the Securities and Exchange
    Commission, we have reconciled these non-GAAP
    measures to the most directly comparable GAAP
    measure in the Financial Overview section of this
    presentation. A copy of other relevant slides
    pertaining to the use of non-GAAP measures is
    available on our website, www.mtga.com, at
    Investor Relations/Online Presentations.

7
Agenda
  • Mohegan Tribe Overview
  • Mohegan Tribal Gaming Authority Overview
  • Mohegan Sun at Pocono Downs
  • Other Diversification Efforts
  • Financial Overview
  • MTGA Capital Structure Liquidity and Capital
    Expenditures
  • Update on Mohegan Sun
  • Summary
  • Questions

8
Mohegan Tribe Overview
9
Mohegan Tribe Overview
  • The Mohegan Tribe received federal recognition in
    1994
  • Approximately 1,700 members
  • Strongly committed to tribal culture and history
  • Mohegan Sun is situated on 240 of the Mohegan
    Tribes 507-acre reservation in southeastern CT
  • Nine member Tribal Council serves as governing
    body

10
Mohegan Tribe Overview
  • On August 28, 2005, the Tribe held an election
    wherein all nine seats on the Mohegan Tribal
    Council were chosen.
  • Effective October 3, 2005, the following
    individuals were elected to office
  • Bruce S. Bozsum Chairman (reelected) 4 year
    term
  • Marilynn R. Malerba Vice Chairwoman 4 year
    term
  • Roberta J. Harris-Payne Corresponding Secretary
    2 year term
  • Allison D. Johnson Recording Secretary 2 year
    term
  • William Quidgeon, Jr. Treasurer 4 year term
  • Ralph James Gessner, Jr. 4 year term
  • Mark W. Hamilton 4 year term
  • Mark F. Brown (reelected) 2 year term
  • Roland J. Harris (reelected) 2 year term

11
Mohegan Tribe Overview
  • Mohegan Tribe Distribution Policy
  • Approved by the Bureau of Indian Affairs (BIA)
  • Distributions are made on a quarterly basis to
    members - 36.5 million in FY 2005
  • Tribal Council determines level of tribal
    dividends that will be distributed to members
  • Distributions to members under 18 years of age
    are deposited to a trust created by the Tribe
  • FY 2006 distributions by the Authority to the
    Tribe anticipated to be 72.5 million

12
Mohegan Tribal Gaming Authority Overview
13
Mohegan Tribal Gaming Authority Overview
  • Mohegan Tribe established MTGA to conduct gaming
    activities for the Tribe
  • MTGA governed by nine-member Management Board,
    which is the Mohegan Tribal Council
  • Mohegan Tribal Gaming Commission regulates gaming
    on the reservation
  • Mohegan Sun gaming and entertainment complex
    opened by MTGA in October 1996
  • Major expansion Project Sunburst completed in
    FY 2002
  • In January 2005, MTGA acquired Pocono Downs
    harness racing facility and five OTWs in
    Pennsylvania

14
Mohegan Tribal Gaming Authority Overview
  • Mohegan Basketball Club LLC formed in January
    2003 as a whollyowned restricted subsidiary of
    MTGA to operate WNBA franchise Connecticut Sun
  • Mohegan Ventures - Northwest, LLC formed in July
    2004 as a wholly owned unrestricted subsidiary of
    MTGA
  • Holds a 54 membership interest in
    Salishan-Mohegan LLC, an entity formed to develop
    and manage a casino to be located in Washington
    and owned by the Cowlitz Indian Tribe
  • Mohegan Commercial Ventures PA, LLC formed in
    January 2005 as a wholly owned restricted
    subsidiary of MTGA to acquire the entities owning
    Pocono Downs

15
Mohegan Tribal Gaming Authority Overview
16
Mohegan Tribal Gaming Authority Overview
  • Management Transition
  • On April 25, 2006 MTGA announced that its Chief
    Executive Officer, William Velardo, had resigned
    from his position. Mitchell Grossinger Etess,
    who served as the President and CEO of Mohegan
    Sun, assumed additional duties as CEO of the
    Authority effective on May 4, 2006.
  • In addition, MTGA also announced that Jeffrey E.
    Hartmann, Executive Vice President and COO of
    Mohegan Sun, would assume additional duties as
    COO of MTGA and Leo Chupaska, CFO of MTGA would
    assume additional duties as CFO of Mohegan Sun, a
    position which has been vacant since December of
    2005.

17
Mohegan Tribal Gaming Authority Management
Bruce S. Bozsum Chairman Management Board
Mitchell Grossinger Etess President and CEO
MTGA
Jeffrey E. Hartmann Executive Vice President and
COO MTGA
Robert J. Soper President and CEO Mohegan Sun
at Pocono Downs
Mitchell Grossinger Etess President and CEO
Mohegan Sun
Leo M. Chupaska CFO - MTGA
Michael Ciaccio VP General Counsel
Harry Coldreck VP Construction Management
Peter J. Roberti VP MTGA Finance
Paul Brody VP MTGA Development
18
Mohegan Sun at Pocono Downs
19
Mohegan Sun at Pocono Downs
  • On July 21, 2005, MTGA announced the plans for
    Mohegan Sun at Pocono Downs, a proposed 400,000
    sq. ft. gaming and entertainment facility to be
    constructed on the existing grounds of Pocono
    Downs racetrack.
  • Plans provide for approximately 2,000 slot
    machines, 3 full-service restaurants, a 300 seat
    buffet, a 15,000 square foot food court, an
    18,000 square foot nightclub, several bars and
    lounges, 20,000 square feet of retail space, a
    Kids Quest center, 4,000 new parking spaces
    and an enhanced employee services area.
  • Construction scheduled to begin immediately upon
    issuance of a conditional slot license by the
    Pennsylvania Gaming Control Board, now
    anticipated this fall.

20
Mohegan Sun at Pocono Downs
  • Opening date projected to be approximately 14
    months from beginning of construction.
  • Estimated cost of construction for the facility
    is approximately 135.0 million. MTGA will also
    pay a one-time 50.0 million fee to the
    Commonwealth of Pennsylvania once the license is
    granted.
  • Currently we have completed significant
    improvements and additions to the current
    facilities, including a new simulcast facility
    which opened to the public on March 13th, a
    two-story addition to the Grandstand, getting
    ready for the installation of approximately 1,080
    slot machines and a new 10,000 sq ft food court.
    We have also completed improvements for 1,500 new
    parking spaces.
  • These improvements are estimated to cost up to
    70.0 million, including the cost of the slot
    machines.

21
Mohegan Sun at Pocono Downs
  • Completed Stage One of the Pocono Downs
    development and successfully executing against
    Stage Two plan

Stage One
January 25, 2005 - Closed Pocono Downs
acquisition February 3, 2005 - Notes offerings
to put in place long-term fixed-rate
debt for Pocono Downs while also increasing
liquidity for development efforts Q2 Q3 2005 -
Begin conceptual design and site development Q4
2005 - Begin construction of renovations and
improvements to current facility December
2005 - Applied for a conditional and permanent
slot license March 13, 2006 - Opening of
renovated simulcast facility. April 1, 2006 -
Live racing commenced Summer 2006 - Complete
renovations and improvements to current
facility Fall 2006 - Receive conditional
license and open up interim slot facility at
track Early 2007 - Open interim slot
facility - Begin construction of permanent
facility Early 2008 - Open permanent slot
machine facility
Stage Two
22
Ariel View
Phase II Casino Location
Clubhouse Grandstand(Phase I Interim Casino
Location)
23
Then
24
Then
25
Then
26
Construction Phase
27
Construction Phase
28
Construction Phase
29
Main and Upper Level Phase I Casino
Food Court
30
Mezzanine and Lower Level Phase I Casino
31
Enlarged Site Plan
32
Site Plan with Patron Entrances
Entry from Future Parking Structure
Entry from Track
Bus Entry
Signature Entry Valet
Entry from Parking Areas
33
Schematic Floor Plan
34
Conceptual Ariel View
35
Integration of Phase I and Phase II Facilities
36
Conceptual Front Exterior View
37
Mohegan Sun at Pocono Downs
  • Licensing Competitive Update
  • Supplier /Distributor
  • 24 suppliers have submitted applications
  • Awaiting ruling from PGCB meeting scheduled on
    June 28, 2006
  • The PGCBs ability to promulgate temporary
    regulations expires on July 5, 2006.
  • Operators
  • 25 operators originally submitted applications,
    of which 3 were found ineligible for
    consideration
  • Public hearings for operator licenses commenced
    in April
  • Conditional licenses are now expected to be
    issued by the fall of 2006 at the earliest 90
    days after issuances of supplier licenses

38
Competitive Landscape
  • Eastern Pennsylvania Competitive Outlook
  • Mount Airy Lodge Poconos (1)
  • Pocono Manor - Poconos (1)
  • Includes
  • Aztar - Allentown (1)
  • Las Vegas Sands - Bethlehem (1)
  • 4. Boyd Gaming - Limerick (1)
  • 5. Philadelphia (5)
  • Mohegan Sun at Pocono Downs
  • Penn National
  • Chester Downs
  • Philadelphia Park

A
39
Other Diversification Efforts
40
Menominee Project
  • Overview
  • Menominee Tribes reservation is located in
    Keshena, WI
  • Seeking to build a approximately 810 million
    casino in Kenosha, WI at the Dairyland Greyhound
    track, which will include
  • A 116,000-square-foot gaming facility with 3,100
    slot machines and 75 table games
  • The existing greyhound track, with pari-mutuel
    betting on live and simulcast racing
  • A 400-room, upscale hotel with swimming pool,
    fitness facilities and spa
  • A variety of restaurants, including fine dining
    and more casual options
  • State-of-the-art conference and meeting
    facilities
  • A 5,000-seat, multi-use entertainment center
  • Parking facilities for up to 10,000 vehicles
  • 50 miles north of Chicago and 30 miles south of
    Milwaukee
  • More information available at www.kenoshacasino.co
    m

41
Menominee Project
  • Progress to Report
  • Development Service Agreement late 2003
  • Land into Trust Application submitted in July
    2004
  • Management Agreement in 2004
  • Intergovernmental Agreement with City and County
    have been approved
  • Tribe has invested 3.1 million to date in form
    of a loan to developer
  • Additional 2.0 million of funding approved of
    which 1.7 million loaned to date
  • Two referendums were won, one in the city of
    Kenosha and one in the county of Kenosha
  • Ongoing
  • EIS Process
  • Scoping Report is complete and has been released
    to the public
  • Draft EIS Report is complete and had been
    released to the public. Comment period expired in
    March 2006.
  • Final EIS to be submitted to the BIA in July of
    2006.
  • Dialogue with State officials regarding compact
    is ongoing

42
Cowlitz Project
  • Overview
  • The Cowlitz Tribe is a federally recognized
    landless tribe, with most members residing in
    southern Washington state
  • The tribe is seeking to build a 400 million
    casino and resort located near Portland,
    Oregon
  • MTGA is a partner in the management and
    development agreements
  • MTGA has partnered with local businessman to
    manage the property

43
Cowlitz Project
  • Progress to Report
  • Development Service Agreement in place
  • Management Agreement in place
  • MTGA has approximately 16.4 million invested in
    project at March 31, 2006
  • Land for planned casino site has been acquired
  • Cowlitz received restored lands opinion in late
    2005
  • Ongoing
  • Negotiation for Local community and governmental
    unit agreements continues
  • Draft EIS has been released, public hearings held
    on June 14th and June 15th in Vancouver,
    Washington
  • A 90 day comment period has been established for
    this project comment period began on April 14,
    2006
  • Final EIS to be submitted to BIA in late 2006
  • Discussion with state officials regarding gaming
    compact are ongoing
  • Public relations and local information campaign
    continues

44
Financial Overview
45
Second Quarter Fiscal 2006 Operating Results
  • Record second quarter gaming revenues of 303.9
    million, an increase of 6.9 over the prior year
  • Gross slot revenues of 216.7 million, an
    increase of 7.9 over the prior year
  • 5.9 increase in slot handle to 2.5 billion
  • Gross slot hold of 8.8 compared to 8.6 the
    prior year
  • Increased slot win per unit of 388 compared to
    357 the prior year
  • Table games revenues of 84.9 million, increase
    of 4.7
  • 12.1 increase in table drop to 566.9 million
  • Table games hold of 15.0 compared to 16.0 in
    the prior year
  • Increased table win per unit of 3,151 compared
    to 3,110 the prior year
  • Non-gaming revenue of 59.5 million, an increase
    of 7.1 over the prior year
  • Income from operations of 64.2 million, an
    increase of 10.7 over the prior year
  • Record second quarter adjusted EBITDA of 87.7
    million, an increase of 9.1 over the prior year

46
Financial Initiatives at Mohegan Sun
  • Review major business processes to seek out
    greater efficiencies
  • Adjusted EBITDA margin for Mohegan Sun increased
    from 27.0 in Q2 2005 to 27.8 for Q2 2006
  • Focus on variable labor to achieve greater
    productivity
  • Revenue per FTE has increased to approximately
    42,809 for Q2 2006 from approximately 40,374
    for Q2 2005 for Mohegan Sun
  • Continued optimization of hotel occupancy rates
  • Roll out of TITO
  • Modified health care program to reduce escalating
    medical costs
  • Design marketing programs and promotional events
    to increase targeted patron volume

47
Second Fiscal Quarter 2006Revenue Comparison
Q206 vs. Q205
363.4
339.9
303.9
284.4
22.7
20.7
25.2
23.3
11.6
11.5
Q2 05
Q2 06
(in millions)
48
Second Fiscal Quarter 2006 Operating Results
49
Reconciliation of Adjusted EBITDA to Net Income
Second Fiscal Quarter 2006
50
Approximate Active Players by State Mohegan Sun
Graph utilizes best available information as of
May 31, 2006.
51
Current Slot Operating Results
52
Current Slot Operating Results
53
LTM Operating ResultsRevenue Growth LTM March
31, 2006 vs. LTM March 31, 2005
54
LTM Operating Results March 31, 2006
55
Reconciliation of Adjusted EBITDA to Net Income
for LTM March 31, 2006
56
MTGA Annual Compound Rate
CAGR 13.0
CAGR 11.6
( in millions)
57
Mohegan Tribal Gaming Authority Capital
Structure Liquidityand Capital Expenditures
58
Debt Capitalization
59
Debt Maturities
60
Capital Spending
61
MTGA Tribal Distributions
Actual
Forecast
62
Update on Mohegan Sun
63
Update on Mohegan Sun
  • Overview
  • Rollout of TITO
  • Updating Mohegan Sun master plan
  • Currently working with architects (WATG) to
    develop the master plan for a potential expansion
  • Also working with Rockwell Group on internal
    design and theme for the planned expansion
  • Tribal Council is in the process of working on
    the overall strategic plan
  • Strategic plan will provide guidance for the next
    3-5 years

64
Summary
65
Summary
  • Why invest in MTGA
  • Outstanding Tribal Leadership
  • Strong Financial Performance
  • Experienced Management Team
  • Mohegan Sun - Premier East Coast Gaming and
    Resort Destination
  • Diversification Efforts through Disciplined
    Approach
  • Mohegan Sun at Pocono Downs Plans to be first
    slot facility in the State of Pennsylvania

66
Questions
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