Big quarter for
L.V. Sands; Adelson
selling stock

Feb 21, 2006 9:37 AM

It was all about Macao when Las Vegas Sands Corp. (LVS) reported its record fourth quarter and full year 2005 earnings last week. And investors responded quickly by boosting the company’s share price by 10%.

Also helping to boost interest in the company’s shares was the announcement that Chairman and CEO Sheldon Adelson and some family trusts would sell some $2 billion worth of LVS shares in what was described as a secondary offering.

When the announcement was made, company shares were selling in the $49 range but soon moved up to $55. It later fell back a bit, closing on Friday at $53.19.

During the fourth quarter that ended on Dec. 31, 2005, the company had consolidated revenues of $500.6 million compared to $347.5 million in the fourth quarter of 2004. For the fiscal year 2005, revenues reached $1.7 billion while the previous year’s revenues amounted to slightly less than $1.2 billion.

The growing influence of Macao’s importance to the company finances was noted with revenues for the fourth quarter at $271.9 million and for the entire year at $896.5 million.

Casino revenues at The Venetian during the fourth quarter increased from last year’s $72.4 million to $105.1 million. Table games win percentage also moved upward from 16.1% in 2004 to 26.4%.

The Venetian’s average daily room rate was $222, the same in 2005 as in 2004. Occupancy rate jumped from 93.2% to 96.5% during the reporting quarter.

Also adding to the company’s revenues were the $17.1 million contributed by the sands Expo and Convention Center. This produced operating income of $2.7 million.

In Macao, the company said the table game "drop" during the fourth quarter was $1.04 billion, an increase of 14.2% over the comparable quarter of a year earlier. Win percentage for the table games was 16.5%.

Officials indicated that the company would be opening an expansion of the existing facility called the Sands’ Paiza Club in May with additional high end tables. The remainder of the expansion will take place in August.

Isle of Capri

Still recovering from the effects of the Gulf hurricanes of last summer, Isle of Capri Casinos Inc. (ISLE) reported that its third quarter profit for the period that ended on Jan. 22, 2006, rose 17%.

Net income of $4.1 million or $0.13 per diluted share compared to net income of $3.5 million or $0.11 per diluted share for the same quarter a year ago.

Included in the net income were $3.8 million in net hurricane related pre-tax charges related to casinos in Biloxi, Miss., Lake Charles, La., and Pompano Park in Florida. Also included was a $2.1 million pre-tax loss on early extinguishment of debt related to its property in Colorado.

During the period, the company had net revenues of $269.8 million compared to last year’s $265.4 million.

Subsequent to the end of the quarter, the company entered into an agreement to sell its properties in Bossier City, La., and Vicksburg, Miss., for $240 million in cash. Closing on the sale is expected in mid-summer.

PENN National

Despite charges related to the aftermath of Hurricane Katrina, Penn National Gaming Inc. (PENN) reported net income that more than doubled the amount reported the previous year.

The company said net income grew to $37.6 million or $0.44 per share compared to $16.9 million or $0.20 cents reported in the fourth quarter of 2004.

Revenues, which included those from a full quarter’s operation of the Argosy Casino properties acquisition, rose 90% to $516.6 million from last year’s $276.5 million.

Charges included $0.03 per share for hurricane damage and early debt extinguishment expenses and $0.02 per share from a gain from the sale of discontinued operations.

In his fiscal report, Peter Carlino, chairman and CEO, noted that the company was aggressively pursuing the "re-birth" of both Casino Magic in Bay St. Louis and Boomtown in Biloxi, Miss., both heavily damaged by the hurricane.

"At Casino Magic," said Carlino, "we intend to open an approximate 30,000 square foot temporary casino”¦which will be replaced later with a permanent land-based casino." As for the Boomtown barge, the facility, which Carlino described as heavily damaged, is under repair in dry dock and is expected to return to operation during the fourth quarter of this fiscal year.

Also on the docket is the forced sale of two casinos in Illinois, mandated by the Illinois Gaming Board. However, the company has requested a two-year extension to the order since recent state action has discouraged buyers, the company said.

Aztar Corp.

Once again, Aztar Corp. (AZR) benefited strongly from its addition at Tropicana Atlantic City, boosting its revenue and earnings for the fourth quarter that ended on Dec. 30, 2005.

Revenues rose 18.7% to $222.8 million from last year’s $187.7 million while net profit jumped up to $11.2 million or $0.29 per share from the $2.3 million or $0.05 per share in 2004.

The company noted that during the fourth quarter, the Tropicana "substantially outpaced all of its Atlantic City competitors in growth of slot revenue, up 31%, and total casino revenue, up 24%."

During a conference call, Bob Haddock, president and CEO, noted that the company was eager to proceed with the development of a new project at the Tropicana Hotel/Casino at the intersection of Las Vegas Boulevard and Tropicana Boulevard in Las Vegas.

Plans call for a $1.2 billion casino resort that would include a 100,000 square-foot casino, a four-acre rooftop pool and 200,000 square feet of dining, entertainment and retail space.