ST. LOUIS, Aug. 24 /PRNewswire-FirstCall/ -- Isle of Capri Casinos,
Inc. (NASDAQ:ISLE) today reported financial results for the first
quarter ended July 30, 2006. The Company reported a 13.0% increase
in net revenues from continuing operations to $274.0 million for
the first quarter compared to net revenues from continuing
operations of $242.5 million for the same quarter in fiscal 2006.
Net income for the first quarter of fiscal 2007 increased 132% to
$9.2 million or $0.29 per diluted common share, compared to $4.0
million or $0.13 per diluted common share for the first quarter of
fiscal 2006. Adjusted EBITDA(1) from continuing operations for the
first quarter of fiscal 2007 increased 24.5% to $56.9 million
compared to Adjusted EBITDA(1) from continuing operations of $45.8
million for the same quarter in fiscal 2006. For the first quarter
of fiscal 2007 and fiscal 2006 the Isle-Bossier City,
Isle-Vicksburg and Colorado Grande-Cripple Creek are reflected as
discontinued operations. Accordingly, the operating results for
these properties are not included in the net revenue and Adjusted
EBITDA(1) results discussed above. "I am pleased that we have begun
fiscal 2007 with a solid performance showing increases in both net
revenues and Adjusted EBITDA(1) ahead of prior year. In addition,
the completion of the sale of our Vicksburg and Bossier City
properties enhances our financial flexibility and allows us to
focus on development projects as we move forward," Bernard
Goldstein, chairman and chief executive officer, said. Highlights
and Updates * On August 18, 2006, the Harrison County Planning
Commission approved the Company's master plan for the previously
announced 50-acre development at west Harrison County, Mississippi.
The Company continues to place the Pine Hills project on a fast
track and will announce more specifics about the project as the
details become finalized. * On July 31, 2006, the Company finalized
the sale of its Vicksburg, Mississippi and Bossier City, Louisiana
properties to Legends Gaming, LLC. The Company received net
proceeds before any related income taxes of $239.4 million. The
Company continues to evaluate its options for the use of these
proceeds. * The Company announced that it is proceeding with the
development of its slot machine facility, which will include 1,500
slot machines, a poker room and four restaurants, at Pompano Park
Harness Track in Florida. As previously announced, the Company
anticipates that a recent adverse court decision will not impact
the opening of this facility scheduled for early 2007. An appellate
court recently ruled that a trial is necessary to determine whether
the required number of signatures were received to place the
constitutional amendment on the ballot in November 2004, in order
to permit slot machines at Pompano Park. An appeal of this decision
and a request for rehearing is pending. * Accomplished chef Luke
Palladino's signature restaurant, Bragozzo, created exclusively for
the Isle of Capri, is scheduled to open in October at the
Isle-Biloxi with a second restaurant opening in early 2007 at the
Company's Pompano Park property in Florida. "Our results show a
strong performance for the quarter, despite the fact that we have
absorbed a significantly higher level of expenses related to
increased insurance premiums, stock compensation expenses,
corporate office relocation expenses, and lease termination costs.
Going forward, we continue to focus on elevating our existing
properties and pursuing our new growth opportunities," Tim Hinkley,
president and chief operating officer, said. Operational Review of
the Company's Continuing Operations for the First Quarter of Fiscal
2007 Compared to the First Quarter of Fiscal 2006 Operating results
for the first quarter of fiscal 2007 include several significant
costs compared to the first quarter of fiscal 2006. These costs
include an increase of approximately $4.5 million in property
insurance expense over the prior year first quarter which was
allocated across all operating properties. This increase is
expected to continue through fiscal 2007. The Company also recorded
approximately $2.0 million of stock compensation expense in the
first quarter of fiscal 2007 related to the adoption of FASB
Statement No. 123(revised 2004) "Share-Based Payment" (SFAS
123(R)). This stock compensation expense is also expected to
continue. The Company recorded approximately $2.1 million of
relocation costs related to moving its corporate headquarters to
Saint Louis, Missouri. Further office relocation costs will be
recorded in the second fiscal quarter of 2007. The stock
compensation expense and office relocation costs are reflected in
the Corporate and other expense line item. Additionally, the
Company recorded approximately $2.2 million in lease termination
costs at the Isle-Our Lucaya in the first quarter of fiscal 2007.
This charge relates to the Company's planned exit of the Isle-Our
Lucaya operation by June 2007. No further lease termination costs
are expected to be recorded related to Isle-Our Lucaya. In
Mississippi, the Company's three continuing operations contributed
31.2% of net revenues. Isle-Biloxi's net revenues were up from the
prior year period principally because of the Company's new and
upgraded land-based casino and the continuation of limited
competition in the Biloxi market. Adjusted EBITDA(1) at the
property was also up significantly over the same quarter in fiscal
2006 due to reduced competition in the market. Isle-Natchez
experienced increases in both net revenues and Adjusted EBITDA(1)
primarily resulting from the continuing effects of population
shifts into its market area. Isle-Lula's net revenues increased
slightly. Adjusted EBITDA(1) at the property increased moderately
due to more efficient management of expenses. In Louisiana, the
Isle-Lake Charles contributed 16.3% of net revenues. Isle-Lake
Charles experienced an increase in net revenues and Adjusted
EBITDA(1), compared to the prior year period, primarily due to the
closure of a competitor in the market. In Missouri, the Company's
two properties contributed 14.9% of net revenues. Isle-Kansas
City's net revenues were down due to a decreased gaming patron
count attributable to the completion of other expansion projects in
the market and increased marketing intensity by competitors.
Isle-Boonville's net revenues and Adjusted EBITDA(1) increased due
to an increase in marketing efforts and the opening of the new
hotel. In Iowa, the Company's three casinos contributed 18.4% of
net revenues. Combined, the Company's two Quad-City properties and
the Isle-Marquette showed a decrease in both net revenues and
Adjusted EBITDA(1) due to increased competition in the key feeder
markets. In Colorado, the Company's two Black Hawk casino
operations contributed 14.5% of net revenues. The increase in net
revenues was due to the completion of our expansion projects.
Adjusted EBITDA(1) decreased primarily due to increased operating
costs associated with the expanded facility and marketing expenses
associated with the opening of competitors expansion projects. New
development expenses decreased compared to the first quarter of
fiscal 2006 primarily related to costs incurred relating to pursuit
of the casino license in Singapore during the first quarter of
fiscal 2006, partially offset by increased expenses related to the
pursuit of the casino license in Pittsburgh, Pennsylvania in the
first fiscal quarter of 2007. The increase in corporate expenses is
primarily related to costs incurred related to the move of the
corporate offices to Saint Louis, Missouri and the stock
compensation expense related to the adoption of SFAS 123(R) on May
1, 2006 as discussed above. Operating results from the Colorado
Grande-Cripple Creek, Isle-Vicksburg and Isle-Bossier City have
been classified as discontinued operations for both periods
presented and thus are not included in the Operational Review
discussed above. Isle of Capri Casinos, Inc. Consolidated
Statements of Income* (Unaudited) (In thousands, except per share
amounts) Three Months Ended July 30, July 24, 2006 2005 Revenues:
Casino $277,620 $244,285 Hotel, pari-mutuel, food, beverage &
other 54,424 48,047 Gross revenues 332,044 292,332 Less promotional
allowances 58,076 49,836 Net revenues (2) 273,968 242,496 Operating
and other expenses: Properties 203,278 184,553 New development (3)
5,014 7,276 Corporate and other (4) 10,683 4,915 Preopening (5) 249
33 Depreciation and amortization 23,502 21,600 Total operating and
other expenses 242,726 218,377 Operating income 31,242 24,119
Interest expense, net (19,108) (16,416) Minority interest (6)
(1,071) (2,056) Income from continuing operations before income
taxes 11,063 5,647 Income tax expense (7) 5,748 2,352 Income from
continuing operations 5,315 3,295 Income from discontinued
operations (including minority interest), net of income taxes 3,925
689 Net income $9,240 $3,984 Earnings per common share - basic:
Income from continuing operations $0.17 $0.11 Income from
discontinued operations (including minority interest), net of
income taxes 0.13 0.02 Net income $0.30 $0.13 Earnings per common
share - diluted: Income from continuing operations $0.17 $0.11
Income from discontinued operations (including minority interest),
net of income taxes 0.12 0.02 Net income $0.29 $0.13 Weighted
average basic common shares 30,422 29,945 Weighted average diluted
common shares 31,404 31,361 Selected Consolidated Balance Sheet
Accounts* (In Thousands) July 30, 2006 April 30, 2006 Cash and cash
equivalents $98,156 $121,193 Property and equipment, net 995,393
938,428 Debt 1,266,127 1,221,280 Stockholders' equity 295,166
282,688 * The sale of the Company's Vicksburg, Mississippi and
Bossier City, Louisiana properties closed on July 31, 2006 and this
transaction will be recorded in the second fiscal quarter of 2007.
Isle of Capri Casinos, Inc. Comparative Financial Highlights by
Casino Property (Unaudited) (In thousands) Three Months Ended July
30, July 24, 2006 2005 Adjusted Adjusted Net Adjusted EBITDA Net
Adjusted EBITDA Revenues EBITDA (1) Revenues EBITDA (1) (2) (1)
Margin % (2) (1) Margin % MISSISSIPPI BILOXI $52,855 $22,562 42.7%
$23,355 $3,847 16.5% NATCHEZ 11,157 3,275 29.4% 9,038 2,218 24.5%
LULA 21,371 5,730 26.8% 21,287 4,907 23.1% MISSISSIPPI TOTAL 85,383
31,567 37.0% 53,680 10,972 20.4% LOUISIANA LAKE CHARLES 44,667
10,037 22.5% 39,585 7,961 20.1% MISSOURI KANSAS CITY 20,710 2,706
13.1% 21,989 3,877 17.6% BOONVILLE 20,121 5,362 26.6% 18,370 5,345
29.1% MISSOURI TOTAL 40,831 8,068 19.8% 40,359 9,222 22.8% IOWA
BETTENDORF 23,378 6,717 28.7% 24,962 8,086 32.4% DAVENPORT 16,935
5,126 30.3% 17,703 4,852 27.4% MARQUETTE 10,201 2,323 22.8% 11,480
3,560 31.0% IOWA TOTAL 50,514 14,166 28.0% 54,145 16,498 30.5%
COLORADO BLACK HAWK/COLORADO CENTRAL STATION (8) 39,615 11,156
28.2% 39,356 12,350 31.4% INTERNATIONAL BLUE CHIP (10) 2,179 (209)
(9.6%) 2,115 (236) (11.2%) OUR LUCAYA 4,930 (2,845) (57.7%) 6,955
1,312 18.9% INTERNATIONAL TOTAL 7,109 (3,054) (43.0%) 9,070 1,076
11.9% CORPORATE & OTHER (9) 5,849 (14,997) N/M 6,299 (12,327)
N/M TOTAL $273,968 $56,943 20.8% $242,494 $45,752 18.9% Note:
Excludes properties classified as discontinued operations Isle of
Capri Casinos, Inc. Reconciliation of Operating Income (Loss) to
Adjusted EBITDA by Casino Property (Unaudited) (In thousands) Three
Months Ended July 30, 2006 Stock Deprecia- Compensa- Operating
Operating tion & Pre- tion Adjusted Income Income Amorti-
opening Expense EBITDA Margin% (Loss) zation (5) (4) (1) (1)
MISSISSIPPI BILOXI $18,299 $4,263 $- $- $22,562 34.6% NATCHEZ 2,350
925 - - 3,275 21.1% LULA 3,253 2,477 - - 5,730 15.2% MISSISSIPPI
TOTAL 23,902 7,665 - - 31,567 28.0% LOUISIANA LAKE CHARLES 6,081
3,956 - - 10,037 13.6% MISSOURI KANSAS CITY 968 1,738 - - 2,706
4.7% BOONVILLE 4,083 1,279 - - 5,362 20.3% MISSOURI TOTAL 5,051
3,017 - - 8,068 12.4% IOWA BETTENDORF 4,918 1,799 - - 6,717 21.0%
DAVENPORT 3,595 1,531 - - 5,126 21.2% MARQUETTE 1,511 812 - - 2,323
14.8% IOWA TOTAL 10,024 4,142 - - 14,166 19.8% COLORADO BLACK
HAWK/COLORADO CENTRAL STATION (8) 7,236 3,920 - - 11,156 18.3%
INTERNATIONAL BLUE CHIP (10) (318) 109 - - (209) (14.6%) OUR LUCAYA
(2,924) 79 - - (2,845) (59.3%) INTERNATIONAL TOTAL (3,242) 188 - -
(3,054) (45.6%) CORPORATE & OTHER (9) (17,810) 614 249 1,950
(14,997) N/M TOTAL $31,242 $23,502 $249 $1,950 $56,943 11.4% Note:
Excludes properties classified as discontinued operations Isle of
Capri Casinos, Inc. Reconciliation of Operating Income (Loss) to
Adjusted EBITDA by Casino Property (Unaudited) (In thousands) Three
Months Ended July 24, 2005 Deprecia- Operating Operating tion &
Pre- Adjusted Income Income Amortiza- opening EBITDA Margin% (Loss)
tion (5) (1) (1) MISSISSIPPI BILOXI $694 $3,153 $- $3,847 3.0%
NATCHEZ 1,108 1,110 - 2,218 12.3% LULA 2,700 2,207 - 4,907 12.7%
MISSISSIPPI TOTAL 4,502 6,470 - 10,972 8.4% LOUISIANA LAKE CHARLES
4,245 3,716 - 7,961 10.7% MISSOURI KANSAS CITY 2,059 1,818 - 3,877
9.4% BOONVILLE 4,196 1,149 - 5,345 22.8% MISSOURI TOTAL 6,255 2,967
- 9,222 15.5% IOWA BETTENDORF 6,343 1,743 - 8,086 25.4% DAVENPORT
3,020 1,832 - 4,852 17.1% MARQUETTE 2,831 729 - 3,560 24.7% IOWA
TOTAL 12,194 4,304 - 16,498 22.5% COLORADO BLACK HAWK/COLORADO
CENTRAL STATION (8) 9,294 3,056 - 12,350 23.6% INTERNATIONAL BLUE
CHIP (10) (343) 107 - (236) (16.2%) OUR LUCAYA 863 449 - 1,312
12.4% INTERNATIONAL TOTAL 520 556 - 1,076 5.7% CORPORATE &
OTHER (9) (12,891) 531 33 (12,327) N/M TOTAL $24,119 $21,600 $33
$45,752 9.9% Note: Excludes properties classified as discontinued
operations 1. EBITDA is "earnings before interest, income taxes,
depreciation and amortization." Isle of Capri calculates Adjusted
EBITDA at its properties by adding depreciation and amortization,
preopening expense, management fees, other charges and non-cash
items to Operating Income (Loss). Adjusted EBITDA is presented
solely as a supplemental disclosure because management believes
that it is 1) a widely used measure of operating performance in the
gaming industry and 2) a principal basis of valuing gaming
companies. Management uses property level Adjusted EBITDA as the
primary measure of the Company's operating properties' performance,
including the evaluation of operating personnel. Adjusted EBITDA
should not be construed as an alternative to operating income as an
indicator of the Company's operating performance, as an alternative
to cash flows from operating activities as a measure of liquidity
or as an alternative to any other measure determined in accordance
with U.S. generally accepted accounting principles (GAAP). The
Company has significant uses of cash flows, including capital
expenditures, interest payments, taxes and debt principal
repayments, which are not reflected in Adjusted EBITDA. Also, other
gaming companies that report Adjusted EBITDA information may
calculate Adjusted EBITDA in a different manner than the Company.
Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by
net revenues. Fiscal 2007 and 2006 results have been reclassified
to reflect the Colorado Grande-Cripple Creek, Isle-Bossier City and
Isle-Vicksburg as discontinued operations. Reconciliations of
operating income to Adjusted EBITDA and operating income as a
percentage of net revenues are included in the financial schedules
accompanying this release. A reconciliation of Adjusted EBITDA with
the Company's net income is shown below. Three Months Ended July
30, July 24, 2006 2005 (In thousands) Adjusted EBITDA $56,943
$45,752 (Add)/deduct: Depreciation and amortization 23,502 21,600
Stock compensation expense (4) 1,950 - Preopening (5) 249 33
Interest expense, net 19,108 16,416 Minority interest (6) 1,071
2,056 Income tax expense (7) 5,748 2,352 Loss (income) from
discontinued operations, net of income taxes (3,925) (689) Net
income $9,240 $3,984 2. Net revenues are presented net of
complimentaries, slot points expense and cash coupon redemptions.
Fiscal 2007 and 2006 results have been reclassified to reflect the
Colorado Grande-Cripple Creek, the Isle-Bossier City and the
Isle-Vicksburg as discontinued operations. 3. New development
expenses include incremental costs incurred pursuing new
opportunities within the industry. Such costs include legal and
other professional fees, application fees and personnel and travel
costs. These expenses are detailed in the table below. New
Development table Three Months Ended July 30, July 24, 2006 2005
Domestic (a) $3,754 $1,189 International (b) 1,260 6,087 $5,014
$7,276 (a) Relates primarily to the Company's development efforts
in Pittsburgh, Pennsylvania (b) Includes development expenses
related to construction at Coventry and various other projects in
the UK and the Company's development agreement with Eighth Wonder
related to Singapore 4. Included in Corporate and other expenses
for the three months ended July 30, 2006 was $2.0 million of
compensation cost related to non-qualified stock options recognized
related to the adoption of SFAS 128(R) on May 1, 2006. 5.
Preopening expenses for the fiscal quarter ended July 30, 2006 are
related to construction of the hotel and casino in Waterloo, Iowa
and development at Pompano Park, Florida and Coventry, England.
Preopening expenses for the fiscal quarter ended July 24, 2005
relate to the construction of the hotel and casino in Waterloo,
Iowa and development at Pompano Park. 6. Minority interest
represents unrelated third parties' portions of the Isle-Black
Hawk's income before income taxes and Colorado Central Station-
Black Hawk's net income. 7. The Company's effective tax rate from
continuing operations for the quarter ended July 30, 2006 was 52.0%
compared to 41.7% for the quarter ended July 24, 2005, which, in
each case, includes an unrelated party's portion of the Colorado
Central Station-Black Hawk's income taxes. The Company's effective
tax rate from combining continuing and discontinued operations for
the quarter ended July 30, 2006 was 48.3% compared to 42.6% for the
quarter ended July 24, 2005. For each comparison, the increase in
effective rate over the comparable prior fiscal period is
attributable to the effect of certain expenses related to the
adoption of SFAS 123(R), and other permanent items on full-year
projected pre-tax income. 8. As management fees are eliminated in
consolidation, Adjusted EBITDA(1) for the Black Hawk/Colorado
Central Station properties does not include management fees. Fiscal
2006 results have been reclassified to reflect the Colorado
Grande-Cripple Creek as a discontinued operation. The following
table shows management fees and Adjusted EBITDA(1) inclusive of
management fees for the three months ended July 30, 2006 and July
24, 2005: Three Months Ended July 30, July 24, 2006 2005 (In
thousands) Management Fees Black Hawk/Colorado Central Station
$1,745 $1,839 Adjusted EBITDA with Management Fees Black
Hawk/Colorado Central Station $9,411 $10,511 9. For the three
months ended July 30, 2006 Corporate and other includes net
revenues of $5.8 million and Adjusted EBITDA(1) of ($1.3) million
related to operations at the Pompano Park property. For the three
months ended July 24, 2005, corporate and other includes net
revenues of $6.2 million and Adjusted EBITDA(1) of ($0.3) million
related to operations at the Pompano Park property. 10. Isle of
Capri Casinos, Inc. acquired a two-thirds interest in Blue Chip
Casinos, PLC on November 28, 2003. Blue Chip Casinos, PLC owns and
operates pub-style casinos in Dudley, Wolverhampton and Walsall,
England. Isle of Capri Casinos, Inc., a leading developer and owner
of gaming and entertainment facilities, operates 13 casinos in 11
locations. The company owns and operates riverboat and dockside
casinos in Biloxi, Lula and Natchez, Mississippi; Lake Charles (2
riverboats), Louisiana; Bettendorf, Davenport and Marquette, Iowa;
and Kansas City and Boonville, Missouri. The company also owns a 57
percent interest in and operates land-based casinos in Black Hawk
(two casinos), Colorado. Isle of Capri's international gaming
interests include a casino that it operates in Freeport, Grand
Bahama and a two-thirds ownership interest in casinos in Dudley and
Wolverhampton, England. The company also owns and operates Pompano
Park Harness Racing Track in Pompano Beach, Florida. CONTACTS: Isle
of Capri Casinos, Inc., Allan B. Solomon, Executive Vice
President-561.995.6660 Donn Mitchell, Chief Financial
Officer-314.813.9319 Jill Haynes, Director of Corporate
Communication-314.813.9368 NOTE: Other Isle of Capri Casinos, Inc.
press releases and a corporate profile are available at
http://www.prnewswire.com/. Isle of Capri Casinos, Inc.'s home page
is http://www.islecorp.com/. This press release contains
forward-looking statements which are subject to change.
Forward-looking statements generally can be identified by the use
of forward-looking terminology such as "may", "will", "expect",
"intend", "estimate", "anticipate", "believe" or "continue" or the
negative thereof or variations thereon or similar terminology.
These forward-looking statements may be significantly impacted,
either positively or negatively by various factors, including
without limitation, licensing, and other regulatory approvals,
financing sources, development and construction activities, costs
and delays, permits, weather, competition and business conditions
in the gaming industry. The forward-looking statements are subject
to numerous risks and uncertainties that could cause actual results
to differ materially from those expressed in or implied by the
statements herein. Additional information concerning potential
factors that could affect the Company's financial condition,
results of operations and expansion projects is included in the
filings of the Company with the Securities and Exchange Commission
including, but not limited to, its 10-K for the fiscal year ended
April 30, 2006.
http://www.newscom.com/cgi-bin/prnh/20020502/ISLELOGO
http://photoarchive.ap.org/ DATASOURCE: Isle of Capri Casinos, Inc.
CONTACT: Allan B. Solomon, Executive Vice President,
+1-561-995-6660, or Donn Mitchell, Chief Financial Officer,
+1-314-813-9319, or Jill Haynes, Director of Corporate
Communication, +1-314-813-9368, all of Isle of Capri Casinos, Inc.
Web site: http://www.theislecorp.com/
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