Melco PBL Entertainment (Macau) Limited, a developer and owner of casino gaming and entertainment resort facilities, reported unaudited financial results for the first quarter ended March 31, 2008.

Net revenue for the first quarter of 2008 was US$482.9 million, up from US$179.8 million in the fourth quarter of 2007(1). The revenue increase was driven almost entirely by the substantial improvement in the operating performance of Crown Macau.

Adjusted EBITDA(2) was US$77.4 million for the first quarter of 2008, up from a loss of US$1.6 million in the fourth quarter of 2007.

Net income for the quarter was US$43.2 million, or US$0.10 per ADS, compared to a net loss of US$36.5 million or US$0.09 per ADS in the fourth quarter of 2007. Net income margin based on net revenue was 9.0% in the quarter under review.

Commentary
Lawrence Ho, Chief Executive Officer and co-Chairman of MPEL, commented, “We are delighted to report our first full quarter of profitability since listing at the end of 2006. The dramatic improvement in the core rolling chip business at Crown Macau in the first quarter of 2008 has been maintained into the second quarter of 2008, and this has led to a rapid acceleration in profitability at both the property level and for MPEL as a whole. We see this as validation of our decision taken over nine months ago to sharpen our focus at Crown Macau on the rapidly growing rolling chip segment.

“In the span of a few short months, Crown Macau has become the busiest casino in the world in terms of gaming volume, impressive given the physical size of the property compared with many of its competitors, and the relatively modest capital investment cost of US$382 million (excluding land value). This is a testament to the award-winning design of the property and the quality of the guest experience delivered by our highly-trained staff. We believe that our insight into the customer profile and our long established and close relationships with our approved junket operators provide MPEL with a distinct competitive advantage.

“We experienced a substantial improvement in rolling chip table games hold percentage in the first quarter of 2008; up from 2.4% in the last quarter of 2007 to 3.1% in the reporting quarter. This is above our expected long term hold percentage of 2.7%.

“We are encouraged by the success we have enjoyed at Crown Macau, and we are equally excited about City of Dreams, our ongoing development in Cotai. We held the topping out ceremony on schedule at the end of the first quarter 2008. We will continue to work diligently over the coming year to deliver an integrated urban destination resort with compelling entertainment and world-class amenities, designed to broaden the appeal of Macau to a growing population of visitors.

“We believe the recent announcement by the Macau government regarding the regulation of the gaming industry is a major positive for the industry and MPEL. We applaud the continued leadership the government has demonstrated on these important issues, and we are proud that our development pipeline delivers what Macau needs to become the entertainment capital of Asia. Our accomplishments are directly attributable not only to our vision and execution, but to the hard work and support of our staff. Upon completion of City of Dreams, MPEL will employ approximately 16,000 individuals in Macau. We are proud to add to the growing prosperity of the city and the ongoing improvement in the lives of its citizens.”

Crown Macau 1Q Results
For the quarter ended March 31, 2008, Crown Macau generated Adjusted EBITDA of US$76.7 million (a 16.7% Adjusted EBITDA margin on net revenue) compared with US$4.2 million in the fourth quarter of 2007. Net revenue achieved a near threefold sequential increase to US$459.9 million in the first quarter 2008, as compared with the last quarter of 2007.

Rolling chip volume totaled US$19.4 billion for the first quarter of 2008, up from US$8.5 billion in the preceding quarter. Actual rolling chip table games hold percentage in the first quarter of 2008 (calculated before discounts and commissions) was 3.1%, above our expected level of 2.7% and substantially above the level of 2.4% achieved in the preceding quarter.

In the mass market table games segment, drop (non rolling chip) totaled US$95.5 million, a 9.6% volume improvement on the preceding quarter. Mass market table games hold percentage was 15.8% in the reporting quarter, at the bottom end of our expected range for mass market table games hold percentage of 16% – 18%. Sequentially, mass market table games hold fell from 17.5% reported in the preceding period.

Gaming machine handle (volume) was US$42.4 million and gaming machine revenue was US$3.8 million in the first quarter of 2008, flat on a sequential basis with the preceding quarter.

Total non-gaming revenue at Crown Macau in the first quarter of 2008 was US$9.4 million, up US$1.8 million or 23.7% as compared with the preceding quarter. Occupancy in the first quarter of 2008 was 92% (78% in the fourth quarter 2007) and the average daily rate was US$233 per occupied room (US$221 in the fourth quarter 2007).

Mocha Clubs 1Q Results
Net operating revenue from the Mocha Clubs totaled US$22.9 million in the first quarter of 2008, representing a 12.8% increase from the corresponding quarter in 2007, and a 6% sequential improvement over the fourth quarter 2007.

Mocha Clubs generated US$6.5 million of Adjusted EBITDA in the first quarter of 2008, which compares with US$6.9 million in the first quarter of 2007. First quarter 2008 margins improved from 22.0% reported in the fourth quarter of 2007 to 28.4% in the current reporting quarter, but remain below the 34% reported in the first quarter of 2007 due to the alignment of labor costs with the market during the past year, as well as higher rental expense at several locations.

In the first quarter of 2008, the number of gaming machines in operation at the Mocha Clubs averaged approximately 1,045 across six locations. Average net win per gaming machine per day increased to US$241 from US$230, when compared with the same period in 2007, and a significant improvement over US$215 reported in the last quarter of 2007.

The seventh Mocha Club opened on October 3, 2007 at Mocha Square, a prime location in central Macau, adding approximately 130 gaming machines. The site was temporarily closed on December 31, 2007 for remedial renovation works and is currently scheduled to resume operations in June 2008. An expansion of the Hotel Royal Mocha outlet was completed and opened on February 5, 2008.

City of Dreams Update
On April 1, 2008, a major milestone for the development of City of Dreams was reached with the topping out of the main podium superstructure and the Hard Rock hotel. The first phase of City of Dreams is expected to open roughly one year from the topping out ceremony, with the date of the grand opening to be set early next year.

Upon completion, City of Dreams will feature a 420,000 square foot casino, numerous restaurants, retail boutiques, nightclubs, an iconic audio visual attraction, a spectacular Dragone show in a purpose built theater, as well as the Crown Towers, Hard Rock and twin-towered Grand Hyatt hotels plus an apartment hotel complex which, in aggregate, will deliver a diverse mix of approximately 2,200 guest rooms, suites and villas.

We estimate that approximately 83% of the hard costs associated with phases one and two of the project have now been let out to sub-contractors.

Macau Peninsula Project Update
The Company continues to review and develop its plans for the development of the Macau Peninsula Trinity project. Those plans are subject to completing the acquisition of the site and certain conditions including meeting applicable Macau regulatory requirements. We do not believe that the government’s recent policy announcements affect this project.

Other Factors Affecting Earnings
Total non-operating income for the first quarter of 2008 was US$0.6 million, which includes US$4.3 million in interest income, less other finance costs of US$3.5 million and US$0.2 million in net foreign exchange losses. Capitalized interest during the first quarter of 2008 totaled US$9.8 million. Pre-opening expenses, which are related to the development of City of Dreams, were US$2.0 million for the first quarter of 2008. Corporate expenses and other costs totaled US$7.0m in the first quarter 2008. Total stock based compensation costs for MPEL were US$1.3m in the current quarter. Depreciation and amortization costs of US$32.1 million were booked in the first quarter 2008, of which US$14.3 million relates to the amortization of our gaming sub-concession.

Financial Position and Capital Expenditure
Cash and cash equivalents as of March 31, 2008, including restricted cash, totaled US$949.1 million. Total outstanding debt at the end of the first quarter was US$615.8 million, consisting of approximately US$500.2 million from the draw down of the first tranche of our US$1.75 billion bank facility and US$115.6 million in loans from MPEL’s two major shareholders. Total debt to shareholders’ equity ratio as of March 31, 2008 was 25.0%.

Capital expenditures for the first quarter 2008 were US$189.1 million, essentially all of which is attributable to the development of City of Dreams.

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