The Astonishing World of MGM Resorts International. 2011ANNUAL REPORT 3 4/20/12 5:50 PM 30210cvr.indd 4-6 30210narr.indd 1 4/20/12 6:38 PM To Our Shareholders We are inspiring a renewed sense of passion in our business. The MGM Resorts International portfolio reflects the world’s most diverse and comprehensive collection of resorts and amenities; developments that have become iconic landmarks in Las Vegas, Detroit, along the Gulf Coast of Mississippi and in Macau. We have already accomplished more than most imagined. We persevered through a devastating macro economic downturn. As a result, we have emerged as better operators, with stronger ties to our employees and customers. We now look forward to the future of our business as we see potential benefits from our improved customer rewards relationships and global expansion opportunities. As industry leaders, we are committed to delivering unparalleled guest experiences and exceptional customer service in a strikingly distinctive combination. MGM Resorts International delivers on its promises—to its business partners, employees and communities. We create an astonishing world. 2 30210narr.indd 2 4/18/12 9:34 PM 3 30210narr.indd 3 4/18/12 9:35 PM A FINE performance. 2011 was a critical year for our Company. We continued to make strategic steps to improve our business— setting us up for success as the recovery in Las Vegas takes hold: • We refinanced CityCenter—in January 2011 we refinanced $2 billion in debt at CityCenter. • We launched M life—leveraging our unparalleled assets through a game-changing customer loyalty program designed to promote the breadth of our Company’s offerings. • We listed MGM China on the Hong Kong Stock Exchange—the successful initial public offering priced at the high end of the proposed range. We purchased an additional 1% of MGM China’s capital stock and became the controlling shareholder. • We prepared our business for the prospect of online gaming—partnering with bwin.party to jointly offer online poker in the U.S. if legalized. 4 30210narr.indd 4 4/18/12 9:35 PM 2011 was a turnaround year for MGM Resorts. Net revenues and Adjusted EBITDA were up double digits and our margins were up more than 100 basis points. MGM China and CityCenter both had significant Adjusted EBITDA growth year over year. We exceeded our REVPAR estimates in each quarter in 2011, driven by better than expected retail customer rates, an indication that our customers are increasing their spend in Las Vegas. In addition, our convention business continues to improve with our wholly owned Las Vegas Strip resort convention mix at 14.7%. Casino trends also continue to improve. International play remains strong. Over the last several quarters domestic play has increased. During the fourth quarter, our wholly owned domestic resorts experienced increases in both volume and win in table games and slots, something we haven’t seen since the fourth quarter of 2007. Our regional resorts continue to excel in their respective markets, with combined Adjusted EBITDA for the full year up 4% year over year. We are proud to report that MGM Grand Detroit had its best fourth quarter and year ever in 2011. 5 30210narr.indd 5 4/18/12 9:35 PM An international SUCC ESS. MGM China is fulfilling international goals. The initial public offering of MGM China occurred in June 2011 and priced at the high end of the range. As part of the transaction, we purchased an additional 1% of the overall capital stock and became the controlling shareholder. As a result of the transaction, we began consolidating the results of MGM China. In early 2012, the MGM China Board of Directors approved a special dividend in the amount of approximately $400 million to its shareholders of record on March 9, 2012. We are pleased that MGM China’s continually improving cash flows have afforded it the ability to return cash to its shareholders. MGM China is evaluating opportunities for the use of cash as they manage growth and expansion prospects with the continued desire to return cash to shareholders. MGM China’s focus on customer relationship building across its business lines has improved revenue and is the core strategy driving future revenue growth. MGM China continues to make operational improvements and believes it still has additional room for further earnings growth. MGM China expects to spend approximately $80 million on capital projects at MGM Macau in 2012, including the build-out of currently undeveloped space and refurbishment capital projects. In Cotai, we are well positioned and have plans for a truly unique experience. Our plans call for a resort containing approximately 1,600 rooms, 500 casino table games, 2,500 slot machines and various restaurant, retail and entertainment offerings. 6 30210narr.indd 6 4/18/12 9:35 PM THE CENTER of it all. CityCenter’s second year of operations showed continued improvement. ARIA’s improvement is attributable to significant growth in volume and revenue across all key operating divisions. Casino revenues increased 27% year over year and hotel revenue increased 24%. Because of its leadership in sustainability initiatives, ARIA continues to develop as one of the top convention destinations in the country; for 2012 ARIA has more than 100% of its planned convention room nights booked. ARIA has announced plans to replace its existing Cirque du Soleil show with Zarkana which we expect to significantly boost business volumes throughout the entire resort. We are also in the process of updating some of our dining options. This year we will open Javier’s, a high-energy casual Mexican restaurant which is extremely popular in the Southern California market. We are also evaluating our other dining options for opportunities to introduce additional recognizable brands to ARIA. All components of CityCenter continue to progress. Vdara was able to grow rate and occupancy in 2011 while also adding an additional 131,000 available room nights into inventory. Vdara had its best quarter yet in the fourth quarter and continues to gain momentum as the premier non-gaming, non-smoking resort in Las Vegas. Crystals at CityCenter, our unparalleled collection of shopping, dining and nightlife, continues to increase its occupancy and same store sales. In addition, CityCenter’s strategy of leasing unsold condominium units continues to be successful. 7 30210narr.indd 7 4/18/12 9:35 PM The year the GAME CHANGED. 2011 marked the culmination of something unmatched in the resort industry: M life, the loyalty program that rewards members for virtually every dollar they spend across 15 of our iconic resorts. M life leverages the full power of our renowned destinations and their complete range of unparalleled dining, entertainment, hotel and spa offerings. Members can earn and redeem rewards at our resorts in Mississippi, Detroit and throughout Las Vegas. The program’s tier structure (Sapphire, Pearl, Gold, Platinum and NOIR) enables all members to enjoy rewards unique to their relationship with the company. Beyond special hotel offers, pre-sale access to show tickets, room upgrades and more, membership comes along with the opportunity to enjoy M life Moments—one-of-a-kind experiences like a private dinner courtesy of a celebrity chef, choosing the songs for the Bellagio Fountain Show and more. Access is the lynchpin of the program—not only in giving everyday travelers the potential to experience high-roller treatment, but also in making it simple and convenient for members to enjoy our breadth of offerings. This takes shape in the all-new mlife.com, an industry leading, revolutionary online 8 30210narr.indd 8 4/18/12 9:35 PM tool that gives members the power to book and share an entire itinerary across multiple resorts — including dinners, shows, spa treatments and accommodations—from a single website. M life is a world all its own—one that is continually expanding. We’ve established strategic partnerships with sbe (a leading hospitality and lifestyle company), Ameristar Casinos, Avis Budget Group and Dover Downs Gaming & Entertainment so that our members can enjoy expansive benefits throughout the country—more possibilities, in more places than ever. Key milestones in the evolution of M life include: • July 2010: M life launches at Beau Rivage • August 2010: The program launches at MGM Grand Detroit and Gold Strike Tunica • January 2011: M life launches at our Las Vegas destinations • June 2011: M life Insider is introduced to MGM Resorts International employees allowing them to easily book rooms for friends and family and access all our company programs • September 2011: M life is enhanced to include non- gaming spend at Beau Rivage • November 2011: Non-gaming spend becomes a part of M life at all participating resorts • February 2012: The launch of the all-new mlife.com 9 30210narr.indd 9 4/18/12 9:35 PM A POSITIVE outlook. 10 30210narr.indd 10 4/18/12 9:35 PM We have accomplished many strategic objectives thus far in 2012. We have made further balance sheet brand recognition and database globally with improvements in 2012 by improving our capital further openings to come. structure at MGM Resorts and CityCenter and Our resorts are more exciting than returning value to shareholders at MGM China ever before: through a cash dividend. • Bellagio—completed a room remodel of We extended $1.8 billion of our senior credit its main tower in 2011 and will begin facility—improving our interest rate and remodeling the Spa tower in late 2012. extending the maturity to February 2015. • MGM Grand Las Vegas—commenced We also issued $1.85 billion of senior notes— a room remodel in 2011 which will be enhancing our maturity profile at attractive rates.