ARGOSY keeps sailing high!
Tuesday April 25, 9:53 am Eastern Time
Company Press Release
SOURCE: Argosy Gaming Company
Argosy Gaming Company Reports
Record First Quarter Results
* Argosy reports Record Earnings of $0.46 per diluted share -- up 318%
year-over-year (on a normalized fully taxed basis) * Argosy reports record
revenues * Argosy reports record EBITDA * Argosy reduces interest expense
and debt
ALTON, Ill., April 25 /PRNewswire/ -- Argosy Gaming Company (NYSE: AGY - news) today
announced record earnings, revenues and cash flows for its first quarter ended March 31, 2000.
Record Earnings
The Company reported record net income of $13.4 million or $0.46 per diluted share for the first
quarter ended March 31, 2000, as compared to $4.7 million or $0.17 per diluted share for the first
quarter ended March 31, 1999, before giving effect to a non-recurring item of $1.8 million in the
prior year. After giving effect to the first quarter 1999 charge, the Company reported net income of
$2.9 million or $0.10 per diluted share for the first quarter ended March 31, 1999. Earnings for the
first quarter ended March 31, 2000 are reported on a fully taxed basis as compared to the first
quarter ended March 31, 1999, when the Company benefited from net operating loss
carry-forwards to offset the income tax effect on earnings. Income tax expense increased to $8.5
million or $.29 per diluted share for the first quarter ended 2000, as compared to $.6 million or $.02
per diluted share for the first quarter ended the prior year.
Record Revenues
Three Months Ended
March 31, 2000 March 31, 1999
(unaudited) (unaudited)
Casino Revenues
Western Properties $79,688 $56,049
Lawrenceburg 85,840 73,079
Total $165,528 $129,128
The Company reported a 28% or $36.4 million increase in casino revenues to $165.5 million for the
first quarter 2000 from $129.1 million for the first quarter ended 1999. Argosy reported that casino
revenues increased to record levels. The western properties increased most significantly (Alton --
56%; Baton Rouge -- 41%; Riverside -- 29%; and Sioux City -- 46%) for a combined increase of
42% or $23.6 million to $79.7 million for the first quarter 2000 from $56.0 million the prior year.
Casino revenues in Lawrenceburg increased 17% or $12.8 million to $85.8 million for the first
quarter 2000 from $73.1 million the prior year.
Record Cash Flows
Three Months Ended
March 31, 2000 March 31, 1999
(unaudited) (unaudited)
Casino EBITDA
(Excluding corporate)
Western Properties $22,405 $10,891
Lawrenceburg 34,220 29,199
Total $56,625 $40,090
The Company reported record consolidated EBITDA (earnings before interest, taxes, depreciation
and amortization) of $50.8 million, up from $33.1 million in 1999. EBITDA at the western
properties rose to $22.4 million for the first quarter 2000, an increase of 106%, or $11.5 million,
over first quarter 1999 amounts, and EBITDA in Lawrenceburg was $34.2 million for the first
quarter 2000, an increase of 17%, or $5.0 million, over 1999.
Operating margins also significantly grew at the western properties from 19% for the first quarter of
1999 to 27% for the first quarter 2000. Argosy continued to post impressive 37% margins in
Lawrenceburg for the first quarter ended 2000. The western properties continue to provide greater
diversification of cash flow as they accounted for approximately 53% of the Company's EBITDA,
excluding the minority partners' share in Lawrenceburg and Sioux City, and, before corporate and
other expenses.
The Company attributed its tremendous growth in revenues and EBITDA over the past several
quarters to the strong fundamentals currently evidenced across all gaming markets, including those in
which it operates, to the successful implementation of its strategic plan and to favorable regulatory
changes in 1999.
James B. Perry, President and Chief Executive Officer, commenting on the record first quarter
results, said, ``Our first quarter performance was the strongest in the Company's history and
represents the seventh consecutive quarter we have experienced impressive growth at each and
every casino location. The fundamentals in our markets, fueled by stronger demand for gaming
combined with relatively stable competition, has allowed us to continue to leverage all operations, as
approximately 47% of each incremental dollar or revenue was converted to EBITDA.'' Perry further
stated, ``The Company has never been stronger, and our prospects for the future have never been
brighter. We remain alert to potential opportunities and are confident that by utilizing the strategies
set forth in our recent annual report, along with our financial flexibility, we can continue to optimize
returns for our shareholders.''
Argosy said it will continue to follow its now very successful strategic plan to rise to the next level by
taking advantage of growth opportunities both at existing properties and at new locations. The
criteria for anticipated growth includes diversification of cash flow, increase total EBITDA to greater
than $200 million by the end of 2001, target operations that generate significant cash flow, focus on
strategic alliances that fit the Company's operating plan, and to explore opportunities that meet or
exceed the Company's financial disciplines.
``Finally,'' said Perry, ``At our annual meeting of shareholders last Tuesday, I reiterated that our
priorities and goals remain unchanged. We intend to be the premier riverboat casino operator in the
Country, and we will utilize all resources available to meet our stated goal -- building shareholder
value.''
Reduced Interest Expense and Debt
The Company reported that as a result of its refinancing in mid-year 1999, interest expense
decreased $4.0 million to $10.1 million for the first quarter ended 2000, as compared to $14.1
million for the prior year. Additionally, the Company reported that net borrowings on its credit
facility decreased by $18.8 million during the first quarter ended March 31, 2000, to $85.0 million.
Argosy reported that capital expenditures for the first quarter were approximately $6.5 million
including $2.6 million for progress payments related to the 300-room convention hotel under
construction in Baton Rouge, Louisiana. The Company anticipates commencing operation of the
hotel by January 1, 2001. Argosy said that it expects to spend approximately $31.4 million for the
balance of the year which includes $15.3 million for the completion of the Baton Rouge hotel.
Argosy will host a conference call related to this press release today, April 25, 2000, at 10:30 a.m.
CST. A telephonic replay of the conference call will be made available by dialing (719) 457-0820
(passcode 326163) beginning at 2:30 p.m. CST today and continuing through April 28th. The call
will also be broadcast via the internet beginning 11:30 a.m. CST today and continuing through May
5th, 2000. The broadcast may be accessed by visiting our website at www.argosycasinos.com .
This press release contains statements relating to future results, which are forward-looking
statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Actual
results may differ materially from those projected as a result of any number of risks and uncertainties,
including but not limited to, competitive and general economic conditions in the markets in which the
Company operates, construction delays related to the Baton Rouge Hotel, and the effect of future
legislation or regulatory changes on the Company's operation as well as other risks and uncertainties
detailed from time to time in the Company's Securities and Exchange Commission filings.
Argosy is a leading multi-jurisdictional owner and operator of riverboat casinos and related
entertainment and hotel facilities in the midwestern and southern United States. Argosy, through its
subsidiaries and joint ventures, owns and operates the Alton Belle Casino in Alton, Illinois, serving
the St. Louis metropolitan market; the Argosy Casino in Riverside, Missouri, serving the greater
Kansas City metropolitan market; and the Argosy Casino-Baton Rouge in Louisiana. Argosy is also
a majority partner and operator of the Belle of Sioux City in Iowa, and the Argosy Casino & Hotel
in Lawrenceburg, Indiana, serving the Cincinnati and Dayton metropolitan markets.
ARGOSY GAMING COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Share and Per Share Data)
Three Months Ended
March 31 March 31
2000 1999
(unaudited) (unaudited)
Revenues:
Casino $165,528 $129,128
Admissions 4,988 4,278
Food, beverage and other 16,496 13,593
187,012 146,999
Less promotional allowances (12,195) (9,608)
Net Revenues 174,817 137,391
Costs and expenses:
Casino 71,745 59,450
Selling, general and administrative 33,685 28,652
Food, beverage and other 11,059 9,637
Other operating expenses 7,570 6,588
Depreciation and amortization 8,835 8,473
132,894 112,800
Income from operations 41,923 24,591
Other income (expense):
Interest income 482 907
Interest expense (10,107) (14,134)
(9,625) (13,227)
Income before minority interest
and income taxes 32,298 11,364
Minority interests (10,379) (7,843)
Income tax expense (8,500) (600)
Net income 13,419 2,921
Preferred Stock dividends
and accretion -- (27)
Net income attributable to
Common Shareholders $13,419 $2,894
Basic income per share $0.47 $0.11
Diluted income per share $0.46 $0.10
ARGOSY GAMING COMPANY AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION
(In Thousands)
Three Months Ended
March 31 March 31
2000 1999
(unaudited) (unaudited)
Casino Revenues
Alton Belle Casino $28,188 $18,109
Argosy Casino - Riverside 24,830 19,198
Argosy Casino - Baton Rouge 17,674 12,579
Belle of Sioux City Casino 8,996 6,163
Argosy Casino - Lawrenceburg 85,840 73,079
Total $165,528 $129,128
Net Revenues
Alton Belle Casino $29,162 $18,993
Argosy Casino - Riverside 26,129 20,415
Argosy Casino - Baton Rouge 18,231 13,026
Belle of Sioux City Casino 9,240 6,369
Argosy Casino - Lawrenceburg 91,802 78,469
Other 253 119
Total $174,817 $137,391
Income (loss) from Operations (A)
Alton Belle Casino $8,433 $3,982
Argosy Casino - Riverside 4,717 2,035
Argosy Casino - Baton Rouge 3,379 (107)
Belle of Sioux City Casino 1,549 845
Argosy Casino - Lawrenceburg 29,002 24,424
Corporate (B) (3,582) (5,026)
Jazz Enterprises, Inc. (1,323) (1,231)
Other (252) (331)
Total $41,923 $24,591
EBITDA (A)¸
Alton Belle Casino $9,986 $5,008
Argosy Casino - Riverside 6,072 3,494
Argosy Casino - Baton Rouge 4,431 1,264
Belle of Sioux City Casino 1,916 1,125
Argosy Casino - Lawrenceburg 34,220 29,199
Lawrenceburg financial
advisory fee (D) (1,711) (1,460)
Corporate (B) (3,487) (5,019)
Jazz Enterprises, Inc. (648) (556)
Other (21) 9
Total $50,758 $33,064
(A) Income from operations and EBITDA are presented before consideration
of any management fee paid to the Company and in the case of Sioux
City and Lawrenceburg before the 30% and 42.5% minority interests,
respectively.
(B) Includes expenses related to a severance package and a settlement
agreement of $1.8 million for the three months ended March 31, 1999.
(C) "EBITDA" is defined as earnings before interest, taxes, depreciation
and amortization and is presented before any management fees paid.
EBITDA should not be construed as an alternative to operating income,
or net income (as determined in accordance with generally accepted
accounting principles) as an indicator of the Company's operating
performance, or as an alternative to cash flows generated by
operating, investing and financing activities (as an indicator of cash
flow or a measure of liquidity). EBITDA is presented solely as a
supplemental disclosure because management believes that it is a
widely used measure of operating performance in the gaming industry
and for companies with a significant amount of depreciation and
amortization. EBITDA may not be comparable to similarly titled
measures reported by other companies. The Company has other
significant uses of cash flows, including capital expenditures,
which are not reflected in EBITDA.
(D) The Lawrenceburg partnership pays a financial advisory fee equal to
5.0% of its EBITDA to a minority partner.
SOURCE: Argosy Gaming Company |
