Mohegan Tribal Gaming Authority Announces Third Quarter Fiscal 2008 Operating Results

UNCASVILLE, Conn., July 31, 2008 (PRIME NEWSWIRE) -- The Mohegan Tribal Gaming
Authority, or the Authority, announced today its operating results for the third
quarter ended June 30, 2008. The Authority is the owner and operator of a gaming
and entertainment complex located near Uncasville, Connecticut, known as Mohegan
Sun, and a gaming and entertainment facility offering slot machines and harness
racing in Plains Township, Pennsylvania, known as Mohegan Sun at Pocono Downs,
or Pocono Downs.

Consolidated financial results for the third quarter ended June 30, 2008:

* Gaming revenues of $330.5 million, a 10.9% decrease from the
third quarter of fiscal 2007
* Table games revenues of $75.3 million, a 25.4% decrease from the
third quarter of fiscal 2007
* Gross slot revenues of $254.4 million, a 5.2% decrease from the
third quarter of fiscal 2007
* Non-gaming revenues of $81.5 million, a 19.0% increase over the
third quarter of fiscal 2007
* Net revenues of $376.8 million, a 7.4% decrease from the third
quarter of fiscal 2007
* Income from operations of $32.7 million, a 56.8% decrease from
the third quarter of fiscal 2007
* Net income of $5.0 million, an 89.0% decrease from the third
quarter of fiscal 2007
* Adjusted EBITDA, a non-GAAP measure described below, of $58.8
million, a 41.0% decrease from the third quarter of fiscal 2007
Other Highlights:

* Table games drop of $650.3 million, a 6.4% increase over the
third quarter of fiscal 2007
* Groundbreaking for construction of the Earth Expansion at Mohegan
Sun, which will feature the 919-room Earth hotel, occurred on May
14, 2008
* Named "Casino of the Year" by the Academy of Country Music
"Our third quarter results reflect pressures from unfavorable economic
conditions and significantly higher gas prices, as well as abnormally low table
games hold percentage, which we expect to return to more normalized levels in
future quarters," said Mitchell Grossinger Etess, President and CEO of the
Authority. "Notwithstanding these pressures, we posted a strong increase in
non-gaming revenues and successfully opened Project Sunrise under budget and
ahead of schedule."

Third Quarter Operating Results

Consolidated Adjusted EBITDA for the quarter ended June 30, 2008 decreased by
$40.9 million, or 41.0%, to $58.8 million from $99.7 million in the third
quarter of fiscal 2007. The decrease in consolidated Adjusted EBITDA is
primarily attributable to decreases in Adjusted EBITDA at Mohegan Sun and Pocono
Downs of $37.1 million and $2.4 million, respectively. The results at Mohegan
Sun were impacted by unusually low table games hold percentage, or table games
revenues divided by table games drop, as further described herein.

Consolidated net income for the quarter ended June 30, 2008 decreased by $40.7
million, or 89.0%, to $5.0 million compared to $45.7 million in the third
quarter of fiscal 2007. The decrease in consolidated net income is primarily due
to decreases in income from operations at Mohegan Sun and Pocono Downs of $37.9
million and $3.4 million, respectively.

Mohegan Sun

Adjusted EBITDA at Mohegan Sun for the quarter ended June 30, 2008 decreased by
$37.1 million, or 39.8%, to $56.0 million from $93.1 million in the third
quarter of fiscal 2007. This decrease is primarily attributable to lower table
games and slot revenues. Adjusted EBITDA margin, or Adjusted EBITDA as a
percentage of net revenues, decreased to 17.1% for the quarter ended June 30,
2008 from 26.4% in the third quarter of fiscal 2007. Table games hold percentage
decreased 490 basis points to 11.6% for the quarter ended June 30, 2008 compared
to 16.5% in the quarter ended June 30, 2007. Historically, table games hold
percentage at Mohegan Sun has averaged approximately 15.5%.

Net revenues for the quarter ended June 30, 2008 decreased by $26.0 million, or
7.4%, to $326.9 million from $352.9 million in the third quarter of fiscal 2007.
This decrease is attributable primarily to the decline in table games and slot
revenues and a $1.8 million increase in promotional allowances. The increase in
promotional allowances resulted from a significant increase in the number of
shows and ticket sales at the Mohegan Sun Arena, as further discussed below.

Gaming Revenues

The Northeast slot and video lottery terminal gaming market, or the Northeast
slot gaming market, which we have defined to include Mohegan Sun, Foxwoods
Resort Casino, Twin River, Newport Grand and Empire City, has shown year over
year growth, despite the continuing evidence of unfavorable macroeconomic
conditions. The Northeast slot gaming market generated total gross slot
revenues, or gross slot win, of $659.4 million and $642.3 million for the
quarters ended June 30, 2008 and 2007, respectively, representing an increase of
2.7%. Mohegan Sun's slot win efficiency in the Northeast slot gaming market, or
percentage of gross slot win in the market divided by the percentage of slot
machines in the market, for the quarter ended June 30, 2008 decreased to 133.3%
from 142.7% in the third quarter of fiscal 2007. We believe our decline in slot
win efficiency in this market is attributable, in part, to higher gas prices, as
customers in the New York City and Boston markets likely chose to frequent
closer gaming facilities. The Connecticut slot gaming market, which consists of
Mohegan Sun and Foxwoods Resort Casino, generated gross slot win of $407.3
million and $425.8 million for the quarters ended June 30, 2008 and 2007,
respectively, representing a decline of 4.3%. Mohegan Sun's slot win efficiency
in the Connecticut slot gaming market, or percentage of gross slot win in the
market divided by the percentage of slot machines in the market, for the quarter
ended June 30, 2008 increased to 117.7% from 116.2% in the third quarter of
fiscal 2007. Gross slot win at Mohegan Sun for the quarter ended June 30, 2008
decreased by $10.3 million, or 4.6%, to $213.1 million from $223.4 million in
the third quarter of fiscal 2007. We believe the reduction in slot revenues at
Mohegan Sun is primarily attributable to increased competition in the Northeast
slot gaming market from recently expanded video lottery terminal facilities in
Yonkers, NY and Lincoln, RI, and, to a lesser extent, our Connecticut
competitor, Foxwoods Resort Casino, following the opening of their new and
expanded gaming facility on May 17, 2008. In addition, we believe higher gas
prices and the continued weakening of consumer spending in the Northeast region
resulted in lower spending by gaming patrons, which also contributed to the
decline in our slot revenues. Mohegan Sun's gross slot win per unit per day was
$392 and $413 for the quarters ended June 30, 2008 and 2007, respectively.
Mohegan Sun's gross slot hold percentage, or gross slot win divided by slot
handle, for the quarter ended June 30, 2008 was 8.5% compared to 8.6% in the
third quarter of fiscal 2007. The decrease in gross slot hold percentage is
attributable to the introduction of $8.1 million in free promotional slot play
to our patrons, which is reflected in slot handle, during the quarter.

Table games revenues decreased by $25.6 million, or 25.4%, to $75.3 million for
the quarter ended June 30, 2008 from $100.9 million in the third quarter of
fiscal 2007. The decrease in table games revenues is attributable to a
significant decrease in table games hold percentage to 11.6% for the quarter
ended June 30, 2008 compared to 16.5% in the third quarter of fiscal 2007. Table
games hold percentage is relatively predictable over long periods of time, but
can fluctuate significantly over shorter periods. Historically, table games hold
percentage at Mohegan Sun has averaged approximately 15.5%. Utilizing our
historical average table games hold percentage of 15.5%, we estimate that our
table games revenues were negatively impacted by approximately $25.5 million for
the quarter. Table games drop increased 6.4% to $650.3 million for the quarter
ended June 30, 2008 from $611.2 million in the third quarter of fiscal 2007. The
growth in table games drop primarily resulted from increased high limit table
games play, the continued success of Mohegan Sun's Asian table games marketing
program and by the August 2007 opening of the 46-table Sunrise Square expansion.
Table games revenue per unit per day was $2,578 and $3,990 for the quarters
ended June 30, 2008 and 2007, respectively.

Non-gaming Revenues

Food and beverage revenues increased by $1.2 million, or 5.3%, to $23.8 million
for the quarter ended June 30, 2008 from $22.6 million in the third quarter of
fiscal 2007. The increase in food and beverage revenues is attributable
primarily to increased banquet revenues from the Mohegan Sun convention center
and the addition of new revenues from the 4,000-square-foot "Hong Kong" Street
food outlet in Sunrise Square, which opened in August 2007. The increased number
of entertainment events at the Mohegan Sun Arena also contributed to the
increase in food and beverage revenues during the quarter.

Hotel revenues for the quarter ended June 30, 2008 increased by $1.4 million, or
12.4%, to $12.5 million from $11.1 million in the third quarter of fiscal 2007.
The increase in hotel revenues is primarily attributable to an increase in the
average daily room rate, or ADR, to $114 for the quarter ended June 30, 2008
compared to $104 in the third quarter of fiscal 2007. The increase in ADR is
consistent with increases in room rates offered to transient and group hotel
guests in the Northeast slot gaming market. The increase in ADR was also
supported by the growth in entertainment business, as further discussed below.
Hotel occupancy increased to 95.5% for the quarter ended June 30, 2008 from
94.4% in the third quarter of fiscal 2007. The increase in hotel occupancy is
partially attributable to rooms being out of service during the third quarter of
fiscal 2007 due to the hotel room renovation program, which began in January
2007 and was completed in June 2007. Revenue per available room, or REVPAR,
increased to $108 for the quarter ended June 30, 2008 compared to $98 in the
third quarter of fiscal 2007.

Retail, entertainment and other revenues increased by $9.8 million, or 30.9%, to
$41.4 million for the quarter ended June 30, 2008 from $31.6 million in the
third quarter of fiscal 2007. This increase is primarily the result of a $10.4
million, or 91.6%, increase in entertainment revenues due to a significant
increase in the number of shows at the Mohegan Sun Arena, resulting in a 41.7%
increase in Arena ticket sales, as well as a 40.5% increase in average price per
ticket at the Arena from more headliner shows performed in the Arena, including
eight Billy Joel concerts, as compared to the third quarter of fiscal 2007. The
increase in retail, entertainment and other revenues was partially offset by a
$1.2 million decrease in retail revenues.

Income from Operations

Income from operations for the quarter ended June 30, 2008 decreased by $37.9
million, or 52.3%, to $34.5 million from $72.4 million in the third quarter of
fiscal 2007. The decrease in income from operations is primarily attributable to
the declines in gaming revenues as more fully discussed above, combined with
higher direct entertainment costs resulting from the increased number of shows
at the Mohegan Sun Arena during the quarter.

"Our programs continued to outperform the market in the Northeast in the third
quarter," said Anthony Patrone, Senior Vice President of Marketing. "Despite the
opening of a major expansion by our main competitor, we were able to increase
our slot win efficiency by low single digits and hold market share in the
Connecticut slot gaming market, while our table games volumes grew by more than
6%. We continued to deliver more headliner shows in the quarter, attracting
large audiences and helping produce double-digit growth in our non-gaming
revenues."

Pocono Downs

Adjusted EBITDA for the quarter ended June 30, 2008 decreased by $2.4 million,
or 24.4%, to $7.3 million from $9.7 million in the third quarter of fiscal 2007.
This decrease is primarily attributable to lower gaming revenues following the
opening of a new gaming facility by a competitor, Mount Airy Casino Resort, or
Mount Airy, in Mount Pocono, Pennsylvania, in October 2007, and higher casino
marketing and promotional expenses in response to the new competition. Adjusted
EBITDA margin decreased to 14.6% for the quarter ended June 30, 2008 from 17.8%
in the third quarter of fiscal 2007.

Net revenues for the quarter ended June 30, 2008 decreased by $4.3 million, or
7.8%, to $49.9 million from $54.2 million in the third quarter of fiscal 2007.
This decrease is attributable primarily to the decline in gaming revenues and a
$902,000 increase in promotional allowances due to higher redemptions under the
Player's Club program, partially offset by an increase in non-gaming revenues.

Commenting on the results at Pocono Downs, Robert J. Soper, President and Chief
Executive Officer, said, "We are encouraged by our results this quarter,
including our very strong win efficiency, particularly in light of the difficult
economic climate, the changing competitive landscape and construction
disruptions caused by Project Sunrise. We are upbeat about our growth prospects
after a very successful opening of our new complex on July 17th."

Gaming Revenues

The Northeastern Pennsylvania slot gaming market, which we have defined to
include Pocono Downs and Mount Airy, generated gross slot win of $89.9 million
and $44.7 million for the quarters ended June 30, 2008 and 2007, respectively,
representing an increase of 101.2%. Gross slot win at Pocono Downs for the
quarter ended June 30, 2008 decreased by $3.5 million, or 8.0%, to $41.3 million
from $44.8 million in the third quarter of fiscal 2007. The reduction in slot
revenues at Pocono Downs is primarily attributable to increased competition
following the opening of Mount Airy, located approximately 40 miles away from
Pocono Downs. The slot results for the quarter were also impacted by the
continued weakening of the regional economy and business disruptions caused by
Project Sunrise construction, primarily parking related. Pocono Downs' slot win
efficiency, or percentage of gross slot win in the market divided by the
percentage of slot machines in the market, for the quarter ended June 30, 2008
was 141.9%. Gross slot win per unit per day was $377 and $431 for the quarters
ended June 30, 2008 and 2007, respectively. Gross slot hold percentage for the
quarter ended June 30, 2008 was 8.7% compared to 9.2% in the third quarter of
fiscal 2007. The decrease in gross slot hold percentage is primarily
attributable to the introduction of electronic blackjack games and higher
denomination slot machine games on the gaming floor during the quarter, both of
which have a lower hold percentage than other slot machines.

Racing revenues decreased by $472,000, or 6.3%, to $7.0 million for the quarter
ended June 30, 2008 from $7.5 million in the third quarter of fiscal 2007. The
decrease in racing revenues is primarily due to the continued weakening of the
regional economy and increased competition from newly opened off-track wagering
facilities in New Jersey.

Non-gaming Revenues

Non-gaming revenues for the quarter ended June 30, 2008 increased by $677,000,
or 21.5%, to $3.8 million from $3.1 million in the third quarter of fiscal 2007.
This increase is the result of increases in food, beverage and retail sales due
primarily to increased utilization of Pocono Downs Player's Club points and
promotional coupons at the property's restaurants and its retail outlet.

Income from operations

Income from operations for the quarter ended June 30, 2008 decreased by $3.4
million, or 52.3%, to $3.1 million from $6.5 million in the third quarter of
fiscal 2007.

Corporate

Corporate total operating costs and expenses increased $1.8 million to $5.0
million compared to $3.2 million in the third quarter of fiscal 2007 due to
increased expenditures related to governmental and certain administrative
services provided by the Mohegan Tribe of Indians of Connecticut, or the Tribe,
in conjunction with the operation of Mohegan Sun, higher salary and wages costs
as a result of certain reallocation of costs to Corporate from Mohegan Sun.

Mohegan Tribal Gaming Authority Property Information

Net Revenues Adjusted EBITDA
(in thousands, For the Three For the Three
unaudited) Months Ended Months Ended
----------------------- ------------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Mohegan Sun $ 326,897 $ 352,947 $ 55,995 $ 93,058
Pocono Downs 49,948 54,170 7,296 9,654
Corporate -- -- (4,448) (3,056)
---------- ---------- ---------- ----------

Total $ 376,845 $ 407,117 $ 58,843 $ 99,656
========== ========== ========== ==========

Net Revenues Adjusted EBITDA
(in thousands, For the Nine For the Nine
unaudited) Months Ended Months Ended
----------------------- ------------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Mohegan Sun $1,012,791 $1,051,072 $ 216,735 $ 280,953
Pocono Downs 143,580 130,652(1) 19,856 18,162(1)
Corporate -- -- (14,876) (7,910)
---------- ---------- ---------- ----------

Total $1,156,371 $1,181,724 $ 221,715 $ 291,205
----------- ========== ========== ========== ==========

(1) Includes operating results of Phase I slot facility at
Mohegan Sun at Pocono Downs from opening date of November 14,
2006 to June 30, 2007.
Liquidity, Capital Resources and Capital Spending

As of June 30, 2008, the Authority held cash and cash equivalents of $78.0
million, a decrease of $27.6 million from $105.6 million as of September 30,
2007. As of June 30, 2008, there was $205.0 million drawn on the Authority's
$1.0 billion bank credit facility. Inclusive of letters of credit, which reduce
borrowing availability under the bank credit facility, the Authority had
approximately $787.3 million of available borrowing capacity under the bank
credit facility as of June 30, 2008. The Authority's total debt was
approximately $1.45 billion as of June 30, 2008.

Interest expense decreased by $3.4 million, or 4.7%, to $68.2 million for the
nine months ended June 30, 2008 compared to $71.6 million in the nine months
ended June 30, 2007. The decrease in interest expense is primarily due to the
capitalization of $5.4 million in interest costs relating to Project Horizon and
Project Sunrise and a slight decrease in weighted average interest rate,
partially offset by an increase in weighted average outstanding debt. The
weighted average interest rate was 7.2% for the nine months ended June 30, 2008
compared to 7.4% in the nine months ended June 30, 2007. The weighted average
outstanding debt was $1.36 billion for the nine months ended June 30, 2008
compared to $1.30 billion in the nine months ended June 30, 2007. The increase
in weighted average outstanding debt was due to additional borrowings on the
bank credit facility to fund Project Horizon and Project Sunrise.

Bank Credit Facility Amendment

In February 2008, the Authority received requisite consent from its lenders to
Amendment No. 1 to its bank credit facility. Amendment No. 1, among other
things, provides for increases in permitted capital expenditures for Project
Horizon and Project Sunrise from $800.0 million and $200.0 million,
respectively, to $950.0 million and $215.0 million, respectively. Amendment No.
1 also modified certain provisions of the loan agreement, including the
Authority's total leverage, senior leverage and minimum fixed charge coverage
ratio covenants to conform with the projected expenditures and the projected
completion dates for Project Horizon and Project Sunrise.

Capital Expenditures

The Authority's capital expenditures totaled $272.3 million for the nine months
ended June 30, 2008 compared to $96.6 million in the nine months ended June 30,
2007. The capital expenditures were comprised of capital expenditures at Mohegan
Sun of $136.4 million, which included Project Horizon construction expenditures
of $112.2 million, including capitalized interest of $2.7 million, and capital
expenditures at Pocono Downs of $135.9 million, which included Project Sunrise
construction expenditures of $134.3 million, including capitalized interest of
$2.7 million.

Total capital spending for fiscal year 2008 at Mohegan Sun, exclusive of Project
Horizon spending, is forecasted to be $58.0 million. Maintenance capital
expenditures for fiscal year 2008 at Mohegan Sun are anticipated to be $37.3
million for the replacement and improvements of information technology
equipment, systems and software, Casino of the Earth renovations and the
purchase of slot machines. An additional $20.7 million is being expended in
fiscal 2008 in the Casino of the Sky to replace coin redemption booths with slot
machines and new bars and to prepare space for the Casino of the Wind.

Total capital expenditures for Pocono Downs are anticipated to be $178.0 million
for the 2008 fiscal year, comprised primarily of $175.5 million in construction
and furniture, fixtures and equipment expenditures to complete Project Sunrise.

Project Horizon - Connecticut

Project Horizon, Mohegan Sun's second major expansion, consists of four major
components (Sunrise Square, Casino of the Wind, Earth Expansion and Property
Infrastructure). The plans for Project Horizon include adding approximately 919
hotel rooms, gaming space and other new non-gaming amenities to Mohegan Sun.
Upon completion of Project Horizon, Mohegan Sun is expected to offer
approximately 7,000 slot machines, 380 table games, including poker, 2,100 hotel
rooms, 75 restaurant and retail outlets, 30 bars and lounges and 4 entertainment
venues.

Sunrise Square, our new Asian-themed gaming area in the Casino of the Earth, was
completed in August 2007 at a cost of approximately $17.0 million. Sunrise
Square includes 8,500 square feet of gaming space offering 46 table games such
as Mini-Baccarat, Sic Bo and Pai Gow Poker, a 5,000-square-foot bus lobby and a
4,000-square-foot "Hong Kong" Street food outlet.

The Authority also is constructing the Casino of the Wind, a new gaming area
adjacent to the Casino of the Sky, which is expected to include approximately
45,000 square feet of gaming space with approximately 670 slot machines, 28
table games and a themed poker room with 42 tables, as well as approximately
20,000 square feet of new dining and retail amenities, including a two-level,
16,000-square-foot Jimmy Buffett's Margaritaville Restaurant and the return of
Chief's Deli, a casual dining restaurant, to be operated by the Authority.
Groundbreaking for the Casino of the Wind occurred in June 2007, and the new
casino is scheduled to open on August 29, 2008. The estimated cost of the Casino
of the Wind is $116.0 million.

Project Horizon also includes the Earth Expansion, which features the Earth
hotel. The Earth hotel is expected to include approximately 919 rooms, including
approximately 261 House of Blues-themed hotel rooms, and a House of Blues
Foundation Room. The Earth Expansion also is planned to include new House of
Blues-themed dining and entertainment amenities, including an approximately
36,000-square-foot music hall and a 3,000-square-foot special events room. In
addition, the Earth Expansion will include approximately 44,000 square feet of
retail space, additional food and beverage facilities, including two fine-dining
options, a burger restaurant, four bars, a family-style sit down pizzeria and a
four-station quick-serve dining area. Groundbreaking for the Earth Expansion
occurred on May 14, 2008. The Earth hotel and related facilities are expected to
open in the Fall of 2010. The estimated cost of the Earth Expansion is $695.0
million.

The Property Infrastructure component of Project Horizon is underway and
includes a 1,500-space parking garage and additional surface parking lots, site
development and road improvements on or adjacent to the property. The estimated
cost is $97.0 million.

Total costs for Project Horizon, inclusive of costs incurred to date for Sunrise
Square, the Casino of the Wind, the Earth Expansion and Property Infrastructure,
currently are estimated to be approximately $925.0 million, exclusive of
capitalized interest. Remaining project costs are estimated to be incurred as
follows: fiscal year 2008, $207.0 million; fiscal year 2009, $270.0 million;
fiscal year 2010, $357.0 million; and fiscal year 2011, $45.0 million.

Project Sunrise - Pennsylvania

Pocono Downs recently completed Project Sunrise, a Phase II gaming and
entertainment facility adjacent to the Phase I gaming facility, which opened to
the public on July 17, 2008. The combined facility now includes approximately
2,500 slot machines and electronic blackjack games, several dining options
including Ruth Chris' Steakhouse, Rustic Kitchen Bistro and Bar, which will also
feature a live cooking show, and Bar Louie, a casual bar and restaurant; as well
as Timbers Buffet, a 300-seat Mohegan Indian cultural heritage themed buffet,
and a food court including Johnny Rockets, Hot Dog Hall of Fame, Puck Express by
Wolfgang Puck, Ben and Jerry's Ice Cream and Betty and Joe's Baker and Coffee
Maker. Pocono Downs now also offers a wide array of retail amenities including
Brookstone, Marshall Rousso women's couture, men's fine apparel boutique Misura,
a fine jewelry store named Reflections, Crossing Vineyards Wine and Cheese Shop,
and MOGO, the Pocono Downs logo store. Project Sunrise also adds three new
bars/lounges: Sunburst Bar, featured in the center of the gaming floor,
Breakers, which offers live entertainment at least three nights a week, and
Pearl Sushi Bar. The final cost of Project Sunrise is anticipated to be
approximately $203.2 million.

"In light of the current economic environment and competitive landscape, we
continue to focus on aligning our cost structure at Mohegan Sun," said Jeffrey
E. Hartmann, the Authority's COO. "We are pleased that our Project Sunrise
project came in under budget and ahead of schedule, and believe that our Casino
of the Wind component of Project Horizon will also be completed under budget and
ahead of schedule, with the grand opening planned on August 29th."

Other Projects

New York

In April 2008, the Authority's wholly owned subsidiary, MTGA Gaming, LLC, or
MTGA Gaming, and Capital Play, Inc., or Capital Play, and its partners, Extell
Development Company and Plainfield Special Situations Master Fund Limited,
submitted a new joint proposal to the State of New York to develop and manage
the proposed video lottery terminal facility and a mixed-use retail and hotel
facility to be developed at Aqueduct Racetrack in Jamaica, New York. If Capital
Play's bid is selected, MTGA Gaming would manage the proposed 4,500 video
lottery terminal facility at Aqueduct Racetrack, which is currently expected to
open in the fall of 2009.

Kansas

In September 2007, MTGA Gaming, along with RED Leg Sun, LLC, or RED and Olympia
Gaming-KC, LLC, or Olympia, formed Leg Sun, LLC, or Leg Sun, a joint venture
created to submit an application to the Kansas Lottery Commission for the
proposed development of a gaming facility and destination resort to be named
Legends Sun and located in Wyandotte County, Kansas. MTGA Gaming, RED and
Olympia were the one-third owners of Leg Sun. During the second fiscal quarter
of 2008, MTGA Gaming restructured its ownership interest in Leg Sun,
transferring its membership interest to Mohegan Resorts Kansas, LLC, or MRK, a
limited liability company owned indirectly 51% by the Tribe and 49% by MTGA
Gaming through Mohegan Gaming & Hospitality, or MG&H. On June 23, 2008, MRK
acquired Olympia's membership interest in Leg Sun and is now the holder of a
two-third ownership interest in Leg Sun, with the remaining one-third interest
held by RED.

In accordance with the Kansas Expanded Lottery Act, the project is subject to
various reviews, requirements and approvals by the Kansas Lottery Commission,
which is considering three other proposals that, like Leg Sun, have received the
requisite local endorsements for the right to develop a single resort casino in
Wyandotte County. The Kansas Lottery Gaming Facility Review Board is required to
select a manager for the Wyandotte County facility by September 30, 2008. If the
Leg Sun proposal is selected, the proposed $770.0 million Legends Sun complex
would feature a wide array of attractions and amenities that include a casino
with approximately 2,000 slot machines, 60 table games and 25 poker tables, a
Robert Trent Jones II designed championship golf course, a luxury hotel with
approximately 350 rooms, a convention and conference facility, approximately
200,000 square feet of mixed-use retail and approximately 200,000 square feet of
residential development.

In a separate matter, in February 2008, a Kansas district court judge ruled that
the Kansas Expanded Lottery Act does not violate the Kansas Constitution and
properly allows for state-owned casinos, including those being proposed in
Wyandotte County. In June 2008, the Kansas Supreme Court upheld the district
court judge's decision.

Capital Resources

Distributions to the Tribe totaled $60.1 million and $55.2 million for the nine
months ended June 30, 2008 and 2007, respectively. Distributions to the Tribe
are anticipated to total $80.0 million for fiscal year 2008.

Management believes that existing cash balances, financing arrangements and
operating cash flows will provide the Authority with sufficient resources to
meet its existing debt obligations, relinquishment payments and foreseeable
capital expenditure requirements with respect to current operations and
distributions to the Tribe for at least the next twelve months. Any future
investments in Mohegan Sun related to Project Horizon and in Pocono Downs
related to Project Sunrise are anticipated to be funded through a combination of
the Authority's operating cash flows and/or the bank credit facility.

Conference Call

The Authority will host a conference call and simultaneous webcast regarding its
third quarter of fiscal 2008 operating results on Thursday, July 31, 2008 at
11:00 a.m. (Eastern Daylight Time).

Those interested in participating in the call should dial as follows:

(888) 748-0596
(706) 643-0107 (international)

Conference ID: 54596763
Please call five minutes in advance to ensure that you are connected prior to
the initiation of the call. Questions and answers will be reserved for call-in
analysts and investors.

Parties who want to listen to the live conference call on the Internet may do so
through a web link on the company's website at www.mtga.com, in the "Investor
Relations/Online Presentations" section. A replay of the call and related
information will be made available at the same location on the company's website
for thirty days subsequent to the call.

Interested parties may also listen to a taped replay of the entire conference
call commencing two hours after the call's completion on Thursday, July 31,
2008. This replay will run through August 14, 2008.

The access number for a taped replay of the conference call is as follows:

(800) 642-1687
(706) 645-9291 (international)

Conference ID: 54596763
A transcript will be available on the Authority's website for a period of ninety
days following the conference call.

About the Authority

The Authority is an instrumentality of the Tribe, a federally recognized Indian
tribe with an approximately 507-acre reservation situated in southeastern
Connecticut, adjacent to Uncasville, Connecticut. The Authority has been granted
the exclusive power to conduct and regulate gaming activities on the existing
reservation of the Tribe, including the operation of Mohegan Sun, a gaming and
entertainment complex that is situated on a 185-acre site on the Tribe's
reservation. Through its subsidiary, Downs Racing, L.P., the Authority also owns
and operates Pocono Downs, a gaming and entertainment facility offering slot
machines and harness racing in Plains Township, Pennsylvania and several OTW
facilities located elsewhere in Pennsylvania.

The Tribe's gaming operation at Mohegan Sun is one of only two legally
authorized gaming operations in New England offering traditional slot machines
and table games. Mohegan Sun currently operates in an approximately 3.0 million
square foot facility, which includes the Casino of the Earth, Casino of the Sky,
Sunrise Square, The Shops at Mohegan Sun, a 10,000-seat Mohegan Sun Arena, a
350-seat Cabaret Theatre, 100,000 square feet of meeting and convention space
and the approximately 1,200-room luxury Sky Hotel Tower. Mohegan Sun is
currently in the midst of Project Horizon - an expansion project that is to
include a new hotel, additional retail and restaurant space, and a new
64,000-square-foot "Casino of the Wind." Pocono Downs recently completed Project
Sunrise, a Phase II gaming and entertainment facility adjacent to the Phase I
gaming facility, which opened to the public on July 17, 2008. The combined
facility now includes approximately 2,500 slot machines, three full-service
restaurants, a 300-seat buffet, a quick-serve dining area, six retail outlets,
three bars/lounges, additional parking and bus amenities. More information about
the Authority and its properties can be obtained by visiting www.mtga.com.

Special Note Regarding Forward-Looking Statements

Some information included in this press release contains 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. Such statements include
information relating to business development activities, as well as capital
spending, financing sources and the effects of regulation (including gaming and
tax regulation) and increased competition. These statements can sometimes be
identified by the use of forward-looking words such as "may," "will,"
"anticipate," "estimate," "expect," or "intend" and similar expressions. Such
forward-looking information involves important risks and uncertainties that
could significantly affect anticipated results in the future and, accordingly,
such results may differ materially from those expressed in any forward-looking
statements made by or on behalf of the Authority. These risks and uncertainties
include, but are not limited to, those relating to increased competition
(including the legalization or expansion of gaming in New England, New York, New
Jersey and Pennsylvania), the financial performance of Mohegan Sun, Pocono Downs
and the off-track wagering facilities, dependence on existing management,
potential adverse changes in local, regional, national or global economic
climates, the Authority's ability to complete its current expansion project at
Mohegan Sun on time and on budget, the Authority's leverage and ability to meet
its debt service obligations, changes in federal or state tax laws or the
administration of such laws, changes in gaming laws or regulations (including
the limitation, denial or suspension of licenses required under gaming laws and
regulations), and the continued availability of financing. Additional
information concerning potential factors that could affect the Authority's
financial results is included in its Annual Report on Form 10-K for the fiscal
year ended September 30, 2007, as well as its other reports and filings with the
SEC. The forward-looking statements included in this press release are made only
as of the date of this release. 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
or events will be achieved or will occur.

MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
(unaudited)

For the For the For the For the
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenues:
Gaming $ 330,532 $ 371,140 $1,037,054 $1,074,310
Food and beverage 26,482 24,757 76,969 73,525
Hotel 12,497 11,120 36,924 35,283
Retail,
entertainment
and other 42,554 32,621 106,023 91,182
---------- ---------- ---------- ----------
Gross revenues 412,065 439,638 1,256,970 1,274,300
Less -
Promotional
allowances (35,220) (32,521) (100,599) (92,576)
---------- ---------- ---------- ----------
Net revenues 376,845 407,117 1,156,371 1,181,724
---------- ---------- ---------- ----------
Operating costs
and expenses:
Gaming 220,743 216,334 658,488 625,015
Food and beverage 12,500 12,807 36,622 38,386
Hotel 4,488 4,504 13,090 12,585
Retail,
entertainment
and other 19,681 11,362 41,785 32,876
Advertising,
general and
administrative 56,142 59,401 169,795 173,748
Corporate
expenses 4,958 3,222 16,119 8,406
Pre-opening costs
and expenses 1,314 84 1,346 3,829
Depreciation and
amortization 24,328 23,740 72,980 69,851
---------- ---------- ---------- ----------
Total operating
costs and
expenses 344,154 331,454 1,010,225 964,696
---------- ---------- ---------- ----------
Income from
operations 32,691 75,663 146,146 217,028
---------- ---------- ---------- ----------
Other income
(expense):
Accretion of
discount to the
relinquishment
liability (6,771) (7,449) (20,314) (22,346)
Interest income 913 1,148 2,870 2,688
Interest expense,
net of
capitalized
interest (22,697) (23,840) (68,215) (71,564)
Write-off of debt
issuance costs -- -- -- (71)
Other income
(expense), net 390 (96) 461 (458)
---------- ---------- ---------- ----------
Total other
expense (28,165) (30,237) (85,198) (91,751)
---------- ---------- ---------- ----------

Income from
continuing
operations before
minority
interests 4,526 45,426 60,948 125,277
Minority interests 510 169 1,243 497
---------- ---------- ---------- ----------
Income from
continuing
operations 5,036 45,595 62,191 125,774
Income from
discontinued
operations -- 59 -- 90
---------- ---------- ---------- ----------
Net income $ 5,036 $ 45,654 $ 62,191 $ 125,864
========== ========== ========== ==========

MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED SELECTED FINANCIAL INFORMATION
(in thousands)
(unaudited)

As of and for the As of and for the
Three Months Ended Nine Months Ended
--------------------- ---------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Operating Results:
Gross revenues $ 412,065 $ 439,638 $1,256,970 $1,274,300
Net revenues 376,845 407,117 1,156,371 1,181,724
Income from operations 32,691 75,663 146,146 217,028

Other Data:
Adjusted EBITDA $ 58,843 $ 99,656 $ 221,715 $ 291,205
Capital expenditures 115,688 36,646 272,300 96,649
Cash interest paid 12,379 12,113 58,593 58,969

Balance Sheet Data:
Cash and cash
equivalents $ 77,978 $ 117,533 $ 77,978 $ 117,533
Total debt 1,453,967 1,289,992 1,453,967 1,289,992

MOHEGAN SUN
SUPPLEMENTAL DATA - OPERATING STATISTICS
(unaudited)

For the Three Months For the Nine Months
Ended Ended
-------------------- --------------------
June 30, June 30, June 30, June 30
2008 2007 2008 2007
--------- --------- --------- ---------
Adjusted EBITDA:
Adjusted EBITDA (in
thousands) $ 55,995 $ 93,058 $ 216,735 $ 280,953
Adjusted EBITDA
margin 17.1% 26.4% 21.4% 26.7%

Capital expenditures
(in thousands) $ 52,324 $ 29,232 $ 136,402 $ 58,840
Capitalized interest
(in thousands) 947 192 2,668 192

Weighted Average
Number of Units:
Slot machines 5,974 5,939 6,107 6,076
Table games 321 278 322 296

Win Per Unit Per Day:
Slot machines
(gross) $ 392 $ 413 $ 380 $ 405
Table games 2,578 3,990 3,148 3,609

Hold Percentage:
Slot machines
(gross) 8.5% 8.6% 8.5% 8.6%
Table games 11.6% 16.5% 14.2% 16.0%

Connecticut Slot
Gaming Market
Statistics:
Slot handle market
share 52.8% 52.4% 53.2% 53.4%
Slot win market share 52.3% 52.5% 53.8% 53.3%
Slot handle
efficiency 118.7% 116.0% 116.1% 116.7%
Slot win efficiency 117.7% 116.2% 117.5% 116.5%

Northeast Slot Gaming
Market Statistics:
Slot win market share 32.3% 34.8% 33.6% 37.3%
Slot win efficiency 133.3% 142.7% 134.8% 136.6%

Hotel Statistics:
Hotel occupancy % 95.5% 94.4% 92.7% 91.7%
Average Daily Rate
(ADR) $ 114 $ 104 $ 115 $ 114
Revenue Per
Available Room
(REVPAR) $ 108 $ 98 $ 106 $ 104

MOHEGAN SUN AT POCONO DOWNS
SUPPLEMENTAL DATA - OPERATING STATISTICS
(unaudited)

For the Three For the Nine
Months Ended Months Ended
------------------ ------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007 (1)
-------- -------- -------- --------
Adjusted EBITDA:
Adjusted EBITDA (in
thousands) $ 7,296 $ 9,654 $ 19,856 $ 18,162
Adjusted EBITDA margin 14.6% 17.8% 13.8% 13.9%

Capital expenditures (in
thousands) $ 63,364 $ 7,414 $135,897 $ 37,805
Capitalized interest
(in thousands) 1,340 68 2,732 468

Slot Statistics:
Weighted Average Number
of Slot Machines 1,202 1,142 1,203 1,120
Win per unit per day
(gross) $ 377 $ 431 $ 366 $ 418
Hold percentage (gross) 8.7% 9.2% 8.7% 9.5%
Slot handle market
share (2) 44.0% 100.0% 47.2% 100.0%
Slot win market
share (2) 45.9% 100.0% 50.7% 100.0%
Slot handle
efficiency (2) 136.2% 100.0% 138.6% 100.0%
Slot win efficiency (2) 142.1% 100.0% 149.0% 100.0%

------------------------
(1) Includes operating results of Phase I slot facility at Mohegan
Sun at Pocono Downs from opening date of November 14, 2006
to June 30, 2007.

(2) Includes operating results of Mount Airy Resort Casino from
opening date of October 22, 2007 to June 30, 2008.

MOHEGAN TRIBAL GAMING AUTHORITY
ADJUSTED EBITDA RECONCILIATIONS
(unaudited)

Reconciliations of Adjusted EBITDA to Net Income:

Reconciliations of Adjusted EBITDA to net income, a financial
measure determined in accordance with accounting principles
generally accepted in the United States of America, or GAAP, are
shown below (in thousands):

For the Three For the Nine
Months Ended Months Ended
-------------------- --------------------
June 30, June 30, June 30, June 30
2008 2007 2008 2007
--------- --------- --------- ---------

Adjusted EBITDA $ 58,843 $ 99,656 $ 221,715 $ 291,205
Pre-opening costs and
expenses (1,314) (84) (1,346) (3,829)
Depreciation and
amortization (24,328) (23,740) (72,980) (69,851)
Minority interests (510) (169) (1,243) (497)
--------- --------- --------- ---------

Income from operations 32,691 75,663 146,146 217,028
--------- --------- --------- ---------

Accretion of discount
to the relinquishment
liability (6,771) (7,449) (20,314) (22,346)
Interest income 913 1,148 2,870 2,688
Interest expense, net
of capitalized interest (22,697) (23,840) (68,215) (71,564)

Write-off of debt
issuance costs -- -- -- (71)
Other income (expense),
net 390 (96) 461 (458)
Minority interests 510 169 1,243 497
Income from
discontinued
operations -- 59 -- 90
--------- --------- --------- ---------
Net income $ 5,036 $ 45,654 $ 62,191 $ 125,864
========= ========= ========= =========

Reconciliations of Income from Operations to Adjusted EBITDA
(unaudited):

Reconciliations of income from operations, a financial measure
determined in accordance with accounting principles generally
accepted in the United States of America, or GAAP, to Adjusted
EBITDA are shown below (in thousands):

For the Three Months Ended June 30, 2008
-------------------------------------------------------
Income Pre-
(Loss) opening Depreciation
from Costs and and Minority Adjusted
Operations Expenses Amortization Interests EBITDA
---------- -------- ------------ --------- -------
Mohegan
Sun $ 34,547 $ 76 $ 21,372 $ -- $55,995
Pocono
Downs 3,122 1,238 2,936 -- 7,296
Corporate (4,978) -- 20 510 (4,448)
---------- -------- ------------ --------- -------
Total $ 32,691 $ 1,314 $ 24,328 $ 510 $58,843
========== ======== ============ ========= =======

For the Three Months Ended June 30, 2007
-------------------------------------------------------
Income Pre-
(Loss) opening Depreciation

from Costs and and Minority Adjusted
Operations Expenses Amortization Interests EBITDA
---------- -------- ------------ --------- -------
Mohegan
Sun $ 72,364 $ 84 $ 20,610 $ -- $93,058
Pocono
Downs 6,543 -- 3,111 -- 9,654
Corporate (3,244) -- 19 169 (3,056)
---------- -------- ------------ --------- -------
Total $ 75,663 $ 84 $ 23,740 $ 169 $99,656
========== ======== ============ ========= =======

For the Nine Months Ended June 30, 2008
-------------------------------------------------------
Income Pre-
(Loss) opening Depreciation
from Costs and and Minority Adjusted
Operations Expenses Amortization Interests EBITDA
---------- -------- ------------ --------- --------
Mohegan
Sun $ 153,329 $ 91 $ 63,315 $ -- $216,735
Pocono
Downs 9,836 1,255 8,765 -- 19,856
Corporate (17,019) -- 900 1,243 (14,876)
---------- -------- ------------ --------- --------
Total $ 146,146 $ 1,346 $ 72,980 $ 1,243 $221,715
========== ======== ============ ========= ========

For the Nine Months Ended June 30, 2007
-------------------------------------------------------
Income Pre-
(Loss) opening Depreciation
from Costs and and Minority Adjusted
Operations Expenses Amortization Interests EBITDA
---------- -------- ------------ --------- --------
Mohegan
Sun $ 218,562 $ 392 $ 61,999 $ -- $280,953
Pocono
Downs (1) 6,932 3,437 7,793 -- 18,162
Corporate (8,466) -- 59 497 (7,910)
---------- -------- ------------ --------- --------
Total $ 217,028 $ 3,829 $ 69,851 $ 497 $291,205
========== ======== ============ ========= ========

-------------------------------
(1) Includes operating results of Phase I slot facility at Mohegan
Sun at Pocono Downs from opening date of November 14, 2006 to
June 30, 2007.
Adjusted EBITDA Explanation:

Earnings before interest, income taxes, depreciation and amortization, or
EBITDA, is a commonly used measure of performance in the casino and hospitality
industry. EBITDA is not a measure of performance calculated in accordance with
accounting principles generally accepted in the United States of America, or
GAAP. The Authority historically has evaluated its operating performance with
the non-GAAP measure, Adjusted EBITDA, which as used in this press release
represents earnings before interest, income taxes, depreciation and
amortization, pre-opening costs and expenses, accretion of discount to the
relinquishment liability to Trading Cove Associates pursuant to a relinquishment
agreement, write-off of debt issuance costs, income from discontinued operations
and other non-operating income and expense.

Adjusted EBITDA provides an additional way to evaluate the Authority's
operations and, when viewed with both the Authority's GAAP results and
reconciliation to net income, the Authority believes that it provides a more
complete understanding of its business than could be otherwise obtained absent
this disclosure. Adjusted EBITDA is presented solely as a supplemental
disclosure because: (1) the Authority believes it enhances an overall
understanding of the Authority's past and current financial performance; (2) the
Authority believes it is a useful tool for investors to assess the operating
performance of the business in comparison to other operators within the casino
and hospitality industry since Adjusted EBITDA excludes certain items that may
not be indicative of the Authority's operating results; (3) measures that are
comparable to Adjusted EBITDA are often used as an important basis for the
valuation of casino and hospitality companies; and (4) the Authority uses
Adjusted EBITDA internally to evaluate the performance of its operating
personnel and management and as a benchmark to evaluate its operating
performance in comparison to its competitors.

The use of Adjusted EBITDA has certain limitations. Adjusted EBITDA should be
considered in addition to, not as a substitute for or superior to, any GAAP
financial measure including net income (as an indicator of the Authority's
performance) or cash flows provided by operating activities (as an indicator of
the Authority's liquidity), nor should it be considered as an indicator of the
Authority's overall financial performance. The Authority's calculation of
Adjusted EBITDA is likely to be different from the calculation of EBITDA or
other similarly titled measurements used by other casino and hospitality
companies and therefore comparability may be limited. Adjusted EBITDA eliminates
certain substantial recurring items from net income, such as depreciation and
amortization, interest expense and accretion of discount to the relinquishment
liability as described above. Each of these items has been incurred in the past,
will continue to be incurred in the future and should be considered in the
overall evaluation of the Authority's results. The Authority compensates for
these limitations by providing the relevant disclosure of depreciation and
amortization, interest expense, accretion of discount to the relinquishment
liability and other items excluded in the calculation of Adjusted EBITDA both in
its reconciliation to the GAAP financial measure of net income and in its
consolidated financial statements, all of which should be considered when
evaluating its results. The Authority strongly encourages investors to review
its financial information in its entirety and not to rely on a single financial
measure.

-0-
CONTACT: Mohegan Tribal Gaming Authority
Mitchell Grossinger Etess, Chief Executive Officer
Leo M. Chupaska, Chief Financial Officer
(860) 862-8000