MGM Reports Most Profitable Quarter

[J.A.F._Doorhof]

Metro-Goldwyn-Mayer Inc. has reported that the fourth quarter ended Dec. 31, 2001 was the most profitable quarter in the Company's 77-year history. A 29 percent increase in revenues to $375.5 million, a 76 percent increase in EBITDA to $64.0 million and a 216 percent increase in net income to $39.1 million led to the record quarterly results.

Earnings per share on a fully diluted basis increased to $0.16 from $0.06, even though there were fewer shares outstanding in last year's fourth quarter. These results were significantly higher than the previously issued earnings guidance of approximately $0.12 per share. The record EBITDA, net income and earnings per share for the fourth quarter of 2001 were all after the effect of new industry accounting rules.

Commenting on these results, Alex Yemenidjian, chairman and CEO, said, "With all-time record earnings in the fourth quarter, MGM continues to deliver on the Company's promise of rapid growth. All four of our core businesses delivered impressive growth in 2001 and should continue to be strong growth drivers in 2002."

Chris McGurk, vice chairman and COO, added, "Driven by four number-one opening films, MGM had its biggest box office ever in 2001. More importantly, both the MGM and United Artists film slates were profitable. Our worldwide home entertainment and television operations also produced record results in 2001 by aggressively leveraging both our successful new film content and MGM's massive film and television library."

A few operating highlights include: United Artists' No Man's Land, which premiered on Dec. 21, 2001 won a Golden Globe Award for Best Foreign Language Film, and Best Screenplay at the Cannes Film Festival. MGM and United Artists also received six other Golden Globe nominations. Worldwide film and television library revenues increased 27 percent in the fourth quarter. Worldwide home video revenues increased 57 percent over the fourth quarter of 2000. Domestic DVD unit shipments were up 172 percent for the full year 2001, led by the Legally Blonde and Hannibal releases as well as strong library performance.

CONTACT: http://www.mgm.com