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Monarch Casino shows profit

Oct 28, 2008 4:06 PM

by Ray Poirier |

Despite a weak economy, Monarch Casino & Resort, Inc. (MCRI) the owner of the Atlantic Casino Resort Spa in Reno, Nevada, was able to show a profit during the challenging third fiscal quarter.

The company said net profit for the period was $4 million or $0.25 per share compared to last year’s $8 million net profit that amounted to $0.41 per share.

Revenue during the period fell 11% to $38.8 million from last year’s $43.6 million.

Analysts had expected the company to show a profit of $0.21 per share.

Aggressive marketing and discount programs at the facility caused the operating expenses to grow 8.2% to $10 million.

The company said it had used its invested cash reserves for capital projects and share repurchases. The decrease in invested cash reserves resulted in a decrease in interest income from the $568,000 reported in the third quarter of 2007 to $36,000 in the most recent quarter.

The previously announced $12.5 million Atlantis Convention Center Skybridge project, which the company said would provide guests with a convenient, traffic-free stroll between the Atlantis and the Reno-Sparks Convention Center, is on track to open in the fourth quarter.

Following the announcement, one analyst said MCRI "holds significant long-term value, and the company is taking the appropriate steps to position itself to benefit" from future demand.

He set the price target for the company’s shares at $7.50.