ST. LOUIS, Aug. 2 /PRNewswire-FirstCall/ -- Isle of Capri Casinos, Inc.
(Nasdaq: ISLE) today provided additional comments and information on its
financial results for the fourth fiscal quarter and fiscal year ended April
29, 2007, which were reported in its Form 10-K filing on July 30, 2007. The
Company reported a 17.3% decrease in net revenues from continuing
operations to $255.6 million for the fourth quarter compared to net
revenues from continuing operations of $309.1 million for the same quarter
in fiscal 2006. Loss from continuing operations was $13.1 million or
($0.43) per common share, during the fourth quarter of fiscal 2007 compared
to income of $10.5 million or $0.33 per diluted common share for the fourth
quarter of fiscal 2006. Adjusted EBITDA(1) from continuing operations for
the fourth quarter of fiscal 2007 decreased 22.9% to $57.3 million compared
to Adjusted EBITDA(1) from continuing operations of $74.3 million for the
same quarter in fiscal 2006. The fourth quarter ended April 29, 2007
included thirteen weeks of operating results compared to the fourth quarter
ended April 30, 2006, which included fourteen weeks of operating results.
This accounts for approximately 7.5% of the year over year decrease in
revenues and Adjusted EBITDA(1). Other factors contributing to the year
over year declines include increased competition in several of the
Company's markets, most significantly Biloxi, Mississippi and severe
weather in several markets in the first period of the fourth quarter of
fiscal 2007.
For the twelve months ended April 29, 2007, the Company reported a 1.4%
increase in net revenues from continuing operations to $1.0 billion,
compared to $987.4 million for the comparable period in the prior year. For
the twelve months of fiscal 2007, the Company reported a loss from
continuing operations of $21.3 million, or ($0.70) per common share,
compared to income of $8.6 million, or $0.28 per diluted common share for
the same period in fiscal 2006. Adjusted EBITDA(1) from continuing
operations in the twelve-month period reported a 4.5% decrease to $194.6
million, compared to $203.7 million for the comparable twelve-month period
in fiscal 2006. During the twelve months ended April 29, 2007, the Company
recognized a pretax gain of $23.2 million related to the sale of its
Isle-Bossier City and Isle-Vicksburg properties. This gain on sale is
included in income from discontinued operations and the impact on net
income per diluted common share was $0.45 for the twelve-months ended April
29, 2007 with the remaining $0.10 coming from the normal operating results
of the two properties.
Isle-Bossier City, Isle-Vicksburg and Colorado Grande-Cripple Creek are
reflected as discontinued operations for all periods presented.
Accordingly, the operating results for these properties are not included in
the net revenue, income from continuing operations and Adjusted EBITDA(1)
results discussed above. The sale of Isle-Bossier City and Isle-Vicksburg
closed on July 31, 2006.
"Fiscal 2007 was a transitional year for the company, as we prepared
for the opening of three properties under our new brand 'the isle(R),' in
addition to opening a new hotel and acquiring a new property. The response
from our guests has been very positive, and we look forward to growing our
database and elevating the gaming experience for our customers. In
addition, we implemented new technology initiatives that will help us
operate and market more efficiently, and introduced additional programs
across the Company to improve margins," said Bernard Goldstein, president
and chief executive officer.
Highlights and Updates
The following items occurred in the fourth quarter of fiscal 2007:
-- The Company revealed its newest brand, "the isle," when its casino
property in Pompano Beach, Florida opened on April 14.
-- In April the Company reached an agreement with government officials and
its landlord to continue the operation of its casino at Our Lucaya in
Freeport, Grand Bahama.
-- Construction began on the final phase of the project to return the Isle
of Capri Biloxi Casino Resort to pre-Katrina planned levels. The
project includes a land-based casino with approximately 2,100 slot
machines, 50 table games, a new poker room, rebuilding the Company's
signature steakhouse, Farraddays'(R), as well as an expanded
tropical-themed buffet and the reinstatement of the property's
convention and entertainment space. The more than $180 million
construction project will largely be funded by insurance proceeds
associated with Hurricane Katrina.
The following items occurred subsequent to the end of fiscal 2007 on
April 29:
-- On May 3, the Florida legislature passed a bill to permit ATMs on the
premises at Broward County pari-mutuel facilities, although not on the
casino floor, increase operating hours including 18 hours per day on
weekdays and 24 hours per day on the weekends, allow progressive
machines, and increase the number of slot machines from 1,500 to 2,000.
The bill went into effect on July 4.
-- The Company opened its $45 million, 258-room Hotel in Bettendorf, Iowa
on May 21.
-- The agreement to purchase Casino Aztar in Caruthersville, Missouri for
approximately $45 million was finalized on June 10.
-- "the isle" casino and hotel at Waterloo in Iowa opened on June 30 with
a 35,000 square foot single level casino land-based casino, two
restaurants and approximately 200-room hotel. Farraddays', the
Company's signature steakhouse, a nightclub, spa and pool will open
later this fiscal year.
-- The Company opened its "the isle" casino at Coventry located at the
RICOH(TM) Arena in the United Kingdom on July 6. The project,
authorized under the Gaming Act of 1968, includes 70 electronic gaming
machines, over 40 table games including poker, as well as the Company's
signature steakhouse, Farraddays', a Tradewinds Marketplace, and three
bars including Lady G's, an entertainment venue and "Club 87" a sports
bar. A private dining club will open later this fiscal year.
-- The Company entered into a $1.35 billion senior secured credit
facility, replacing the prior $700 million senior secured credit
facility. Additionally, the Company has called its $200 million 9%
subordinated notes at a call price of 104.5%. This will be funded
through a delayed draw term loan under the new senior credit facility.
-- The Company filed its Form 10-Q/A for the 2007 fiscal third quarter on
July 25 and its Form 10-K for the fiscal fourth quarter and year ended
April 29, 2007 on July 30 to complete its previously announced
restatements.
-- Effective July 30 Virginia McDowell became the Company's new President
and Chief Operating Officer. Additionally, the Company announced that
it had added James B. Perry as a new member of its Board of Directors.
"Our search for a new president and chief operating officer has come to
a close and we are pleased to welcome Virginia McDowell to the Isle of
Capri family. We believe that we have selected the ideal candidate as
Virginia brings just the right mix of gaming expertise and leadership
capabilities to her new role. Everyone has eagerly welcomed Virginia to the
Isle of Capri family," Mr. Goldstein noted.
Operational Review of the Company's Continuing Operations for the
Fourth Quarter of Fiscal 2007 Compared to the Fourth Quarter of Fiscal 2006
Operating results for the fourth quarter of fiscal 2007 include one
less week of operating results as compared to the fourth quarter of fiscal
2006. Also the operating results for the fourth quarter of fiscal 2007
include some significant additional expenses, as compared to the fourth
quarter of fiscal 2006. These include an increase of approximately $4.5
million in property insurance expense over the prior year's fourth quarter,
for a twelve-month total increase of approximately $18.0 million over the
prior fiscal year, which was allocated across all operating properties. The
Company also recorded approximately $1.6 million of stock compensation
expense in the fourth quarter of fiscal 2007 related to the adoption of
FASB Statement No. 123 (revised 2004) "Share-Based Payment" (SFAS 123(R)),
for a twelve-month total increase of approximately $7.2 million over the
prior fiscal year. The stock compensation expense is allocated across all
properties, but is primarily reflected in the Corporate expense line item.
Pre-opening costs increased $10.4 million compared to the fourth quarter of
fiscal 2006 primarily due to costs related to our casino developments in
Pompano Beach, Florida; Waterloo, Iowa and Coventry, England.
In Mississippi, the Company's three continuing operations contributed
24.3% of net revenues. Isle-Biloxi's net revenues and Adjusted EBITDA(1)
decreased significantly from abnormally high prior year operating results
due to increased competition in the market as competitors have re-opened
after closures caused by Hurricane Katrina and while the Isle-Biloxi
remains negatively impacted by the destruction of the Biloxi/Ocean Springs
bridge, which is the primary thoroughfare for travelers from Florida to
east Biloxi where Isle-Biloxi is located. Two lanes of the Biloxi/Ocean
Springs bridge are scheduled to re-open in November and the complete new
bridge with six lanes is scheduled to re-open in June 2008. Isle-Natchez
continues to experience decreases in both net revenues and Adjusted
EBITDA(1) primarily resulting from the re-opening of casinos along the Gulf
Coast. Isle-Lula's net revenues and Adjusted EBITDA(1) decreased slightly
due to increased competition impacting certain of the property's outlying
feeder markets and disruption due to renovations of the casino floor.
In Louisiana, Isle-Lake Charles contributed 16.8% of net revenues.
Isle-Lake Charles experienced a decrease in net revenues and Adjusted
EBITDA(1) due to increased competition in the market as competitors have
fully re-opened following closures caused by Hurricane Rita and post
hurricane normalization of population levels in the property's feeder
markets.
In Missouri, the Company's two properties contributed 17.2% of net
revenues. The Company's Missouri operations were impacted by severe winter
weather in the first period of the fourth quarter. Isle-Kansas City's net
revenues and Adjusted EBITDA(1) were down due to increased competition
related to the completion of competitors' expansion projects in the market.
Isle- Boonville's net revenues and Adjusted EBITDA(1) increased due to the
opening of the Company's new hotel and an increase in marketing efforts.
In Iowa, the Company's three casinos contributed 17.7% of net revenues.
Combined, the Company's three Iowa properties, the Isle-Bettendorf, Rhythm
City-Davenport, and Isle-Marquette showed a decrease in both net revenues
and Adjusted EBITDA(1) due to increased competition in certain of our
feeder markets in which we operate, including new and expanded gaming
product by several of our competitors, as well as severe winter weather in
the first period of the fourth quarter.
In Colorado, the Company's two Black Hawk casino operations contributed
15.7% of net revenues. The Black Hawk properties experienced a decrease in
net revenues and Adjusted EBITDA(1) as compared to the prior year period
primarily due to severe weather in the first period of the quarter and
disruption at the Colorado Central Station gaming floor as it was
redesigned for wider aisles and the implementation of 100% ticketing
capabilities on slots.
In International operations, Isle-Our Lucaya recorded a reversal of
approximately $9.4 million in certain prior year expenses related to the
Company's agreement with the Bahamian government and the Company's landlord
to keep the casino open. Additionally, the Company reversed its $2.2
million lease termination fee paid in the first quarter of fiscal 2007,
which has now been recorded as pre-paid rent.
Corporate and other includes the Company's corporate office operations,
new development costs and the operating results of Pompano Park. The
decrease in corporate and other compared to the fourth quarter of fiscal
2006 is primarily due to a $6.2 million decrease in new development costs
primarily due to costs incurred in the prior year fiscal quarter related to
the pursuit of gaming licenses in Pittsburgh, Pennsylvania and Singapore.
In December 2006, the Company was notified that it was not awarded either
gaming license. The operating results of Pompano Park reflected a $3.6
million decrease in Adjusted EBITDA(1), which relates primarily to
construction disruption, increased property insurance premiums and
increased repairs and maintenance costs incurred on the existing track
facility prior to the opening of the Isle-Pompano casino facility. The Isle
Pompano was only opened for the last two weeks of the fourth quarter of
fiscal 2007. Also, the increase in corporate and other expenses includes
approximately $2.0 million in costs incurred related to the completion of
the restatement of the Company's historical financial statements. These
increased costs are partially offset by lower bonus, franchise taxes and
other legal costs.
The Company recorded a $7.8 million valuation charge during the fourth
quarter of fiscal 2007 related to the Isle-Lula, based on lower projected
cash flows going forward. Comparatively, the Company recorded a $13.4
million valuation charge in the fourth quarter of fiscal 2006 related to
its Blue Chip, plc operations in the United Kingdom and the Isle-Our
Lucaya.
Operating results from the Colorado Grande-Cripple Creek,
Isle-Vicksburg and Isle-Bossier City have been classified as discontinued
operations for all periods presented and thus are not included in the
Operational Review discussed above.
Isle of Capri Casinos, Inc.
Consolidated Statements of Income*
(In thousands, except per share amounts)
Three Months Ended Twelve Months Ended
April 29, April 30, April 29, April 30,
2007 2006 2007 2006
(Restated) (Restated)
Revenues:
Casino $255,614 $309,123 $1,015,629 $1,004,143
Hotel, pari-mutuel, food,
beverage & other 49,134 57,366 200,223 183,390
Gross revenues 304,748 366,489 1,215,852 1,187,533
Less promotional
allowances 51,385 61,457 214,458 200,174
Net revenues (2) 253,363 305,032 1,001,394 987,359
Operating and other
expenses:
Properties 182,875 210,784 756,702 725,760
New development (3) 1,608 7,821 16,259 20,369
Corporate expenses (4) 13,215 12,149 41,062 37,494
Preopening (5) 10,436 57 13,573 281
Valuation Charge (6) 7,801 13,388 8,466 13,388
Hurricane related charges,
net (7) --- --- --- 4,776
Depreciation and
amortization 26,608 23,000 99,506 88,819
Total operating and other
expenses 242,543 267,199 935,568 890,887
Operating income 10,820 37,833 65,826 96,472
Interest expense, net (21,836) (20,135) (81,681) (73,641)
Loss on early extinguishment
of debt --- --- --- (2,110)
Income from continuing
operations before income
taxes and minority interest (11,016) 17,698 (15,855) 20,721
Income tax (provision)
benefit (8) (659) (5,079) (1,906) (5,628)
Minority interest (9) (1,449) (2,139) (3,568) (6,462)
Income (loss) from
continuing operations (13,124) 10,480 (21,329) 8,631
Income (loss) from
discontinued operations
(including minority
interest and gain on sale of
discontinued operations),
net of income taxes (10) (1,497) 5,990 16,692 10,244
Net income (loss) $(14,621) $16,470 $(4,637) $18,875
Earnings per common share -
basic:
Income (loss) from
continuing operations $(0.43) $0.35 $(0.70) $0.29
Income from discontinued
operations (including gain
on sale
of assets), net of income
taxes (0.05) 0.19 0.55 0.34
Net income (loss) $(0.48) $0.54 $(0.15) $0.63
Earnings per common share -
diluted:
Income (loss) from
continuing operations $(0.43) $0.33 $(0.70) $0.28
Income from discontinued
operations (including gain
on sale
of assets), net of income
taxes (0.05) 0.19 0.55 0.32
Net income (loss) $(0.48) $0.52 $(0.15) $0.60
Weighted average basic
common shares 30,384 30,257 30,384 30,028
Weighted average diluted
common shares 30,384 31,512 30,384 31,270
Selected Consolidated Balance Sheet Accounts*
April 29, April 30,
2007 2006
(Restated)
Cash and cash equivalents $188,114 $121,049
Property and equipment,
net 1,338,570 979,627
Debt 1,417,979 1,219,057
Stockholders' equity 281,822 280,247
*The above excludes properties classified as discontinued operations.
Discontinued operations include the Company's Bossier City, Louisiana and
Vicksburg, Mississippi properties which were sold on July 31, 2006.
Isle of Capri Casinos, Inc.
Comparative Financial Highlights by Casino Property
(Unaudited)
(In thousands)
Three Months Ended
April 29, 2007 April 30, 2006 (Restated)
Adjusted Adjusted
Net Adjusted EBITDA Net Adjusted EBITDA
Revenues EBITDA (1) Revenues EBITDA (1)
(2) (1) Margin % (2) (1) Margin %
MISSISSIPPI
BILOXI $28,856 $5,655 19.6% $52,430 $24,923 47.5%
NATCHEZ 10,640 4,389 41.3% 13,767 5,909 42.9%
LULA 22,124 7,010 31.7% 25,019 7,763 31.0%
MISSISSIPPI
TOTAL 61,620 17,054 27.7% 91,216 38,595 42.3%
LOUISIANA
LAKE CHARLES 42,615 10,189 23.9% 49,330 13,381 27.1%
MISSOURI
KANSAS CITY 21,754 4,572 21.0% 24,281 5,332 22.0%
BOONVILLE 21,698 6,442 29.7% 21,040 6,260 29.8%
MISSOURI
TOTAL 43,452 11,014 25.3% 45,321 11,592 25.6%
IOWA
BETTENDORF 22,100 6,937 31.4% 25,833 8,865 34.3%
DAVENPORT 14,164 3,395 24.0% 18,808 5,168 27.5%
MARQUETTE 8,629 1,875 21.7% 10,730 2,266 21.1%
IOWA TOTAL 44,893 12,207 27.2% 55,371 16,299 29.4%
COLORADO
BLACK HAWK/
COLORADO
CENTRAL
STATION (11) 39,814 12,901 32.4% 46,076 14,215 30.9%
INTERNATIONAL
BLUE CHIP 2,589 (322) (12.4%) 2,214 (283) (12.8%)
OUR LUCAYA (12) 5,198 11,664 224.4% 7,414 1,215 16.4%
INTERNATIONAL
TOTAL 7,787 11,342 145.7% 9,628 932 9.7%
CORPORATE &
OTHER (13) 13,182 (17,440) N/M 8,090 (20,736) N/M
TOTAL $253,363 $57,267 22.6% $305,032 $74,278 24.4%
Note: Operating results for the fourth quarter of fiscal 2007 include
one less week of operating results as compared to the fourth
quarter of fiscal 2006. Also, the above excludes properties
classified as discontinued operations. Discontinued operations
include the Company's Bossier City, Louisiana and Vicksburg,
Mississippi properties which were sold on July 31, 2006.
Isle of Capri Casinos, Inc.
Comparative Financial Highlights by Casino Property
(Unaudited)
(In thousands)
Twelve Months Ended
April 29, 2007 April 30, 2006 (Restated)
Adjusted Adjusted
Net Adjusted EBITDA Net Adjusted EBITDA
Revenues EBITDA (1) Revenues EBITDA (1)
(2) (1) Margin % (2) (1) Margin %
MISSISSIPPI
BILOXI $147,825 $45,797 31.0% $100,790 $39,778 39.5%
NATCHEZ 40,864 13,319 32.6% 46,135 16,156 35.0%
LULA 83,068 22,485 27.1% 85,731 21,573 25.2%
MISSISSIPPI
TOTAL 271,757 81,601 30.0% 232,656 77,507 33.3%
LOUISIANA
LAKE CHARLES 170,751 37,991 22.2% 161,912 39,501 24.4%
MISSOURI
KANSAS CITY 82,269 13,934 16.9% 88,009 17,468 19.8%
BOONVILLE 81,156 23,155 28.5% 74,519 21,576 29.0%
MISSOURI
TOTAL 163,425 37,089 22.7% 162,528 39,044 24.0%
IOWA
BETTENDORF 87,699 24,866 28.4% 97,154 30,519 31.4%
DAVENPORT 60,483 14,361 23.7% 69,007 17,449 25.3%
MARQUETTE 37,593 8,143 21.7% 42,536 10,394 24.4%
IOWA TOTAL 185,775 47,370 25.5% 208,697 58,362 28.0%
COLORADO
BLACK HAWK/
COLORADO
CENTRAL
STATION (11) 153,718 43,962 28.6% 163,412 49,982 30.6%
INTERNATIONAL
BLUE CHIP 8,898 (1,032)(11.6%) 8,221 (1,510) (18.4%)
OUR LUCAYA (12) 16,777 7,587 45.2% 25,349 2,968 11.7%
INTERNATIONAL
TOTAL 25,675 6,555 25.5% 33,570 1,458 4.3%
CORPORATE &
OTHER (13) 30,293 (59,966) N/M 24,584 (62,118) N/M
TOTAL $1,001,394 $194,602 19.4% $987,359 $203,736 20.6%
Note: Operating results for fiscal year 2007 include one less week of
operating results as compared to fiscal year 2006. Also, the above
excludes properties classified as discontinued operations.
Discontinued operations include the Company's Bossier City,
Louisiana and Vicksburg, Mississippi properties which were sold on
July 31, 2006.
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA by
Casino Property
(Unaudited) (In thousands)
Three Months Ended April 29, 2007
Stock
Deprecia- Compen-
Operating tion & Pre- sation Valuation Adjusted
Income Amortiza- opening Expense Charge EBITDA
(Loss) tion (5) (4) (6) (1)
MISSISSIPPI
BILOXI $19 $5,586 $--- $50 $--- $5,655
NATCHEZ 3,381 985 --- 23 --- 4,389
LULA (3,438) 2,596 --- 51 7,801 7,010
MISSISSIPPI TOTAL (38) 9,167 --- 124 7,801 17,054
LOUISIANA
LOUISIANA TOTAL 6,346 3,821 --- 22 --- 10,189
MISSOURI
KANSAS CITY 3,116 1,417 --- 39 --- 4,572
BOONVILLE 5,173 1,216 --- 53 --- 6,442
MISSOURI TOTAL 8,289 2,633 --- 92 --- 11,014
IOWA
BETTENDORF 4,896 2,023 --- 18 --- 6,937
DAVENPORT 1,790 1,586 --- 19 --- 3,395
MARQUETTE 1,051 766 --- 58 --- 1,875
IOWA TOTAL 7,737 4,375 --- 95 --- 12,207
COLORADO
BLACK HAWK/COLORADO
CENTRAL STATION
(11) 8,926 3,911 --- 64 --- 12,901
INTERNATIONAL
BLUE CHIP (513) 191 --- --- --- (322)
OUR LUCAYA (12) 11,576 62 --- 26 --- 11,664
INTERNATIONAL
TOTAL 11,063 253 --- 26 --- 11,342
CORPORATE & OTHER
(13) (31,503) 2,448 10,436 1,179 --- (17,440)
TOTAL $10,820 $26,608 $10,436 $1,602 $7,801 $57,267
Note: Operating results for the fourth quarter of fiscal 2007 include one
less week of operating results as compared to the fourth quarter of fiscal
2006. Also, the above excludes properties classified as discontinued
operations. Discontinued operations include the Company's Bossier City,
Louisiana and Vicksburg, Mississippi properties which were sold on
July 31, 2006.
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA by
Casino Property
(Unaudited) (In thousands)
Three Months Ended April 30, 2006 (Restated)
Deprecia-
Operating tion & Pre- Valuation Adjusted
Income Amortiza- opening Charge EBITDA
(Loss) tion (5) (6) (1)
MISSISSIPPI
BILOXI $21,422 $3,501 $--- $--- $24,923
NATCHEZ 5,011 898 --- --- 5,909
LULA 5,249 2,514 --- --- 7,763
MISSISSIPPI TOTAL 31,682 6,913 --- --- 38,595
LOUISIANA
LOUISIANA TOTAL 10,008 3,373 --- --- 13,381
MISSOURI
KANSAS CITY 3,517 1,815 --- --- 5,332
BOONVILLE 5,053 1,207 --- --- 6,260
MISSOURI TOTAL 8,570 3,022 --- --- 11,592
IOWA
BETTENDORF 7,095 1,770 --- --- 8,865
DAVENPORT 3,529 1,639 --- --- 5,168
MARQUETTE 1,530 736 --- --- 2,266
IOWA TOTAL 12,154 4,145 --- --- 16,299
COLORADO
BLACK HAWK/COLORADO
CENTRAL STATION
(11) 10,237 3,978 --- --- 14,215
INTERNATIONAL
BLUE CHIP (9,334) 136 --- 8,915 (283)
OUR LUCAYA (12) (2,693) 266 --- 3,642 1,215
INTERNATIONAL
TOTAL (12,027) 402 --- 12,557 932
CORPORATE & OTHER
(13) (22,791) 1,167 57 831 (20,736)
TOTAL $37,833 $23,000 $57 $13,388 $74,278
Note: The above excludes properties classified as discontinued
operations. Discontinued operations include the Company's Bossier City,
Louisiana and Vicksburg, Mississippi properties which were sold on
July 31, 2006.
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA by
Casino Property
(Unaudited) (In thousands)
Twelve Months Ended April 29, 2007
Stock
Deprecia- Compen-
Operating tion & Pre- sation Valuation Adjusted
Income Amortiza- opening Expense Charge EBITDA
(Loss) tion (5) (4) (6) (1)
MISSISSIPPI
BILOXI $26,948 $18,651 $--- $198 $--- $45,797
NATCHEZ 9,391 3,853 --- 75 --- 13,319
LULA 4,231 10,245 --- 208 7,801 22,485
MISSISSIPPI
TOTAL 40,570 32,749 --- 481 7,801 81,601
LOUISIANA
LOUISIANA TOTAL 22,079 15,809 --- 103 --- 37,991
MISSOURI
KANSAS CITY 7,258 6,522 --- 154 --- 13,934
BOONVILLE 17,884 5,085 --- 186 --- 23,155
MISSOURI TOTAL 25,142 11,607 --- 340 --- 37,089
IOWA
BETTENDORF 17,120 7,672 --- 74 --- 24,866
DAVENPORT 8,094 6,207 --- 60 --- 14,361
MARQUETTE 4,802 3,121 --- 220 --- 8,143
IOWA TOTAL 30,016 17,000 --- 354 --- 47,370
COLORADO
BLACK HAWK/COLORADO
CENTRAL STATION
(11) 27,894 15,833 --- 235 --- 43,962
INTERNATIONAL
BLUE CHIP (2,282) 585 --- --- 665 (1,032)
OUR LUCAYA (12) 7,192 300 --- 95 --- 7,587
INTERNATIONAL
TOTAL 4,910 885 --- 95 665 6,555
CORPORATE & OTHER
(13) (84,785) 5,623 13,573 5,623 --- (59,966)
TOTAL $65,826 $99,506 $13,573 $7,231 $8,466 $194,602
Note: Operating results for fiscal year 2007 include one less week of
operating results as compared to fiscal year 2006. Also, the above
excludes properties classified as discontinued operations. Discontinued
operations include the Company's Bossier City, Louisiana and Vicksburg,
Mississippi properties which were sold on July 31, 2006.
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA by
Casino Property
(Unaudited) (In thousands)
Twelve Months Ended April 30, 2006 (Restated)
Deprecia- Hurricane
Operating tion & Related Pre- Valuation Adjusted
Income Amortiza- Charges, opening Charge EBITDA
(Loss) tion net (5) (6) (1)
MISSISSIPPI
BILOXI $28,143 $11,666 $(31) $--- $--- $39,778
NATCHEZ 12,230 3,922 4 --- --- 16,156
LULA 12,089 9,484 --- --- --- 21,573
MISSISSIPPI
TOTAL 52,462 25,072 (27) --- --- 77,507
LOUISIANA
LOUISIANA TOTAL 19,952 15,249 4,300 --- --- 39,501
MISSOURI
KANSAS CITY 10,282 7,186 --- --- --- 17,468
BOONVILLE 17,060 4,516 --- --- --- 21,576
MISSOURI TOTAL 27,342 11,702 --- --- --- 39,044
IOWA
BETTENDORF 23,320 7,199 --- --- --- 30,519
DAVENPORT 10,435 7,014 --- --- --- 17,449
MARQUETTE 7,424 2,970 --- --- --- 10,394
IOWA TOTAL 41,179 17,183 --- --- --- 58,362
COLORADO
BLACK HAWK/COLORADO
CENTRAL STATION
(11) 36,132 13,850 --- --- --- 49,982
INTERNATIONAL
BLUE CHIP (10,974) 549 --- --- 8,915 (1,510)
OUR LUCAYA (12) (2,201) 1,524 3 --- 3,642 2,968
INTERNATIONAL
TOTAL (13,175) 2,073 3 --- 12,557 1,458
CORPORATE & OTHER
(13) (67,420) 3,690 500 281 831 (62,118)
TOTAL $96,472 $88,819 $4,776 $281 $13,388 $203,736
Note: The above excludes properties classified as discontinued
operations. Discontinued operations include the Company's
Bossier City, Louisiana and Vicksburg, Mississippi properties which were
sold on July 31, 2006.
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, pre-opening
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 Twelve Months Ended
April 29, April 30, April 29, April 30,
2007 2006 2007 2006
(Restated) (Restated)
(In thousands)
Adjusted EBITDA $57,267 $74,278 $194,602 $203,736
(Add)/deduct:
Depreciation and
amortization 26,608 23,000 99,506 88,819
Stock compensation
expense 1,602 - 7,231 -
Preopening (5) 10,436 57 13,573 281
Valuation Charge (6) 7,801 13,388 8,466 13,388
Hurricane related
charges, net (7) - - - 4,776
Interest expense, net 21,836 20,135 81,681 73,641
Loss on early
extinguishment of debt - - - 2,110
Income tax provision
(benefit) (8) 659 5,079 1,906 5,628
Minority interest (9) 1,449 2,139 3,568 6,462
Loss (income) from
discontinued
operations, net of
income taxes (10) 1,497 (5,990) (16,692) (10,244)
Net income (loss) $(14,621) $16,470 $(4,637) $18,875
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 Colorado Grande-Cripple Creek, Isle-Bossier
City and 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.
Three Months Ended Twelve Months Ended
April 29, April 30, April 29, April 30,
2007 2006 2007 2006
(Restated) (Restated)
Domestic (a) $1,156 $3,972 $11,737 $8,036
International (b) 452 3,849 4,522 12,333
$1,608 $7,821 $16,259 $20,369
(a) Relates primarily to the Company's development efforts in Pittsburgh,
Pennsylvania. The Company was notified in December 2006 that it was
not awarded this license.
(b) Includes development expenses related to development the Company's
development agreement with Eighth Wonder related to Singapore. The
Company was notified in December 2006 that it was not awarded this
license.
4. Included in Corporate expenses for the three months and the
twelve months ended April 29, 2007 was $1.2 and $5.6 million,
respectively, of compensation cost related to qualified and
non-qualified stock options recognized related to the adoption of SFAS
123(R) on May 1, 2006. Also included in the three months and twelve
months ended April 29, 2007, was $0.7 million and $5.4 million,
respectively, related to the relocation of the Company's corporate
headquarters to Saint Louis, Missouri.
5. Pre-opening expenses for the three months and the twelve months ended
April 29, 2007 are related to our development at Pompano Beach,
Florida, construction of the hotel and casino in Waterloo, Iowa, and
our development project at RICOH(TM) Arena in Coventry, England.
Pre-opening expenses for the three months and the twelve months ended
April 30, 2006 relate to the development at Pompano Beach, Florida and
construction of the hotel and casino in Waterloo, Iowa.
6. Valuation charges in fiscal year 2007 relate primarily to goodwill
impairment at Isle-Lula and an asset impairment charge on real
property at Blue Chip. Valuation charges in fiscal year 2006 are
primarily related to Isle -- Our Lucaya and Blue Chip. Impairment at
Isle-Our Lucaya was due to the change in expected cash flows resulting
from our previous decision to close the casino. Subsequently, in April
2007, our Board of Directors approved agreements with its landlord and
the Government of the Bahamas, which allowed the casino to remain
open; however, the impairment charge was not reversed in 2007.
Additionally in fiscal year 2006, we recorded valuation charges
related to adverse market conditions on expected cash flows of the
Blue Chip Casinos plc operations in the United Kingdom.
7. Hurricane related charges, net, include impairment charges for assets
damaged or destroyed by hurricanes, incremental costs incurred related
to hurricanes and operating costs related to periods affected by
hurricanes. This item also includes anticipated recoveries expected
from our insurance carriers related to property damage, incremental
costs and operating expenses. When the Company and its insurance
carriers agree on the final amount of the insurance proceeds, the
Company will also record any related gain in this account. In
addition, any recoveries of lost profit will be recognized when agreed
to with the insurance carrier and will be reflected in the related
properties revenue and Adjusted EBITDA(1). Accordingly, during the
third fiscal quarter ended January 28, 2007, the Company recorded
$2.2 million of income at its Lake Charles facility related to lost
profits from Hurricane Rita and $0.6 million at its Pompano facility
related to Hurricane Wilma.
8. The Company's effective tax rate from continuing operations for the
quarter ended April 29, 2007 was an expense of 6.0% compared to an
expense of 28.7% for the quarter ended April 30, 2006, which, in each
case, excludes an unrelated party's portion of Colorado Central
Station-Black Hawk's income taxes. The Company's effective tax rate
from continuing operations was an expense of 12% for the fiscal year
ended April 29, 2007, compared to an expense of 27.1% for fiscal year
ended April 30, 2006, which, in each case, excludes our joint venture
partner's portion of the Colorado Central Station-Black Hawk income
taxes. The primary drivers for the difference between the Company's
effective tax rate and the statutory tax rates were permanent
differences from non-deductible expenses, goodwill impairment charges,
AMT and employment tax credits, change in state valuation allowances,
international operations, taxes related to minority interests,
involuntary conversion related to Hurricane Katrina, impairment of
Bahamas operations, restatement changes to deferred tax balances and
qualified stock option expenses that are not deductible.
9. Minority interest represents unrelated third parties' interest in
Isle-Black Hawk's income before income taxes and Colorado Central
Station-Black Hawk's net income.
10. On July 31, 2006 the Company completed the sale of Isle-Bossier City
and Isle-Vicksburg to Legends Gaming, LLC. The Company received
approximately $240 million in proceeds from the sale and has
recognized a pre-tax gain of $23.2 million. Taxes on the gain were
$9.7 with a net gain on sale of discontinued operations of
$13.5 million.
11. As management fees are eliminated in consolidation, Adjusted EBITDA(1)
for the combined Black Hawk/Colorado Central Station property does not
include management fees. Fiscal 2006 results have been reclassified to
reflect 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 and twelve months ended April 29,
2007 and April 30, 2006:
Three Months Ended Twelve Months Ended
April 29, April 30, April 29, April 30,
2007 2006 2007 2006
(Restated) (Restated)
(In thousands)
Management Fees
Black Hawk/Colorado
Central Station $1,791 $1,993 $6,818 $7,439
Adjusted EBITDA with
Management Fees
Black Hawk/Colorado
Central Station $11,110 $12,222 $37,144 $42,543
12. In April 2006 the Company determined it would close its Isle-Our
Lucaya property in Freeport, Grand Bahama by June 2007. In April 2007
the Company reached an agreement with government officials and its
landlord to continue the Isle-Our Lucaya operations. Accordingly,
during the fourth quarter of fiscal 2007, the Company has reversed
$9.4 million of prior year expenses and $2.2 million of lease
termination costs incurred in the first quarter of fiscal 2007.
13. For the three months ended April 29, 2007 corporate and other includes
net revenues of $13.2 million and Adjusted EBITDA(1) of $(3.7) million
related to operations at the Pompano Park property compared to net
revenues of $8.9 million and Adjusted EBITDA(1) of $(0.1) million for
the same prior year period. For the twelve months ended April 29,
2007, corporate and other includes net revenues of $30.1 million and
Adjusted EBITDA(1) of $(8.4) million related to operations at the
Pompano Park property compared to net revenues of $24.7 million and
Adjusted EBITDA(1) of $(2.1) million for the same prior year period.
Isle of Capri Casinos, Inc., founded in 1992, is dedicated to providing
its customers with an exceptional gaming and entertainment experience at
each of its 18 casino properties. The Company owns and operates casinos in
Biloxi, Lula and Natchez, Mississippi; Lake Charles, Louisiana; Bettendorf,
Davenport, Marquette and Waterloo, Iowa; Boonville, Caruthersville and
Kansas City, Missouri and a casino and harness track in Pompano Beach,
Florida. The Company also operates and has a 57 percent ownership interest
in two casinos in Black Hawk, Colorado. Isle of Capri Casinos'
international gaming interests include a casino that it operates in
Freeport, Grand Bahama, a casino in Coventry, England, and a two-thirds
ownership interest in casinos in Dudley and Wolverhampton, England.
There are four Isle of Capri Casinos brands including "the isle," Isle
of Capri, Colorado Central Station and Rhythm City, providing over 16,000
slot machines, 550 table games and 3000 hotel rooms for our guests'
enjoyment.
This press release may be deemed to contain forward-looking statements,
which are subject to change. 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, weather, permits, 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.
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, Senior 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.
SOURCE Isle of Capri Casinos, Inc.
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Related links:
http://www.islecorp.com
CONTACT:
Allan B. Solomon, Executive Vice President,
+1-561-995-6660, or Donn Mitchell, Chief Financial Officer,
+1-314-813-9319, or Jill Haynes, Senior Director of Corporate
Communication, +1-314-813-9368, all of Isle of Capri Casinos,
Inc.
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