Record earnings reported by Isle of Capri Casinos

Aug 19, 2003 7:08 AM

First quarter earnings set a record, according to a report last week by Isle of Capri Casinos Inc. (ISLE). Reporting for the period that ended on July 27, officials said net income was $13.6 million or $0.45 per share compared to last year’s $12.2 million or $0.40 per share.

Revenues for the period amounted to $285.8 million. During the first quarter of 2002, the revenues were $276.7 million. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) reached $67.4 million, easily topping last year’s $60.9 million.

Bernard Goldstein, company chairman and CEO, attributed the record performance to the company’s geographic diversity and "our solid management team (which) continually finds ways to better manage costs."

And not only was business on the upswing during the first quarter but management announced that earnings per share for the second quarter ending in October would be somewhere in the range of the mid-20 cent level to the low 30-cent level. The company said they were feeling the effects of a lagging economic recovery in the south.

As a marketing tool, Isle of Capri rolled out a national television advertising campaign this spring, featuring notable actor Ricardo Montalban. The commercial was designed to convey the company’s unique brand, its fun experience and the benefits of its players’ club. Surveys indicated the commercials increased awareness of its properties by 18%.

The company has recently installed ticket-in/ticket-out technology at 10 of its properties, providing coinless gaming at its slots. Also the company continues its $135 million expansion program at its Biloxi, Miss., and Bossier City, La., properties.

Sands Regent

The Sands Regent (SNDS), operator of the Sands Regency in Reno, Nev., reversed its previous net loss with net income of $701,000 or $0.14 a share. Last year, during the comparable period, the company reported net loss of $26,000 or $0.01 a share.

For the fiscal year, the company reported net income of $1.9 million or $0.38 per basic share of $0.36 per diluted share. During fiscal 2002, the company reported a net loss of $189,000 or $0.04 per diluted share.

Management attributed the year-over-year improvement primarily to the positive effects from its July 2002 acquisition of Gold Ranch Casino & RV Resort, as well as the return of the American Bowling Congress tournament to the Sands Regency.

Commenting on the report, Ferenc B. Szony, president and CEO, said, "The improved results emanated from a full year of contributions from Gold Ranch, improved results at the Sands Regency, and the success of our strategies for cross-promotion between the two properties."

WMS Industries

Inventory write-downs and a special charge resulted in a net loss of $5.2 million or $0.17 a share for WMS Industries Inc. (WMS) during the fiscal fourth quarter that ended on June 30. During the corresponding period of a year ago, the company reported income of $707,000 or $0.02 per share.

The loss included a pretax charge of $3.5 million for the purchase of rights to restricted stock at a discount, and $3.5 million to write off inventory.

However, during the period, the company said revenues increased 18% to $50.9 million from last year’s $43.2 million. The company said the increased revenues came from higher gaming machine sales, mostly outside of North America, and an increase in parts, used games, and conversion revenues.

"The entire WMS team has positioned the company for what we believe will be an impressive re-emergence starting next month at the Global Gaming Expo or G2E trade show in Las Vegas," said Brian Gamache, president and CEO. "We are approaching the final stages of the second phase of the technology improvement plan that we launched in January 2002."

Hard Rock Hotel

Hard Rock Hotel Inc., the privately held company that operates the Hard Rock Hotel & Casino in Las Vegas, reported second quarter net revenues of $35 million compared to $34.1 million in the year-earlier quarter.

The company said quarterly net revenues improved in every department except retail that experienced a 7% decline. Casino revenues were higher because of a 33% improvement in slots play and a 357% increase in race and sports activity.

Peter Morton, company chairman and CEO, said management was "pleased to have a new long-term debt structure in place that provides the company with financial flexibility to pursue targeted growth capital expenditures such as our new 4,500 square foot "mega-suite" a two-level expansion of our parking garage . . . and an expansion of our meeting room facilities."

PDS Gaming

Last year’s loss during the comparable reporting period was reversed this year, officials of PDS Gaming corporation (PDSG) have reported. Net income was $182,000 or $0.05 per diluted share compared to the net loss of $513,000 or $0.14 a share last year.

The company finances, leases and sells gaming equipment for the casino industry. Also, the company operates Rock’s Casino & Sports Bar in Reno, Nev.

Revenues from continuing operations reached $9.8 million from last year’s $8.8 million and operating lease rentals increased from $3.1 million last year to $6.1 million in the most recent quarter.

Casino operations resulted in a pre-tax loss, before depreciation, of $105,000. Last year, the loss was $197,000.

A greater increase in online wagering resulted in record revenues for Inc. (UBET), the nation’s largest provider of horse racing content. The added business helped the company reduce its net loss for the second quarter of 2003.

Net revenue for the quarter that ended on June 30 amounted to $4.6 million, more than doubling the revenue generated in the comparable period of 2002. Net loss was $982,000 or $0.04 per share while last year’s loss was $2.5 million or $0.13 a share.

Charles Champion, chairman and CEO, commented, "Our record-setting performance on handle is further evidence that has achieved premier status among online horse racing enthusiasts. Of equal importance, our technology, which is scalable by a factor of three, excelled during peak periods of the Triple Crown, when we accommodated unprecedented numbers of users without a flaw."

He added that "Our goal remains to leverage our superior product position and our technology advantage to attract additional enthusiasts to our customized, fully integrated wagering services."