Park Place Q4 earnings double vs. year ago
By Sarah Tippit
LOS ANGELES, Feb. 1 (Reuters) - A touch of Paris in Las Vegas helped Park Place Entertainment Corp. (NYSE:PPE - news) double its fourth quarter profits, the world's largest casino operator said on Tuesday.
Citing the success of its new Paris-themed resort on the Las Vegas Strip, Park Place reported net income of $17 million or 5 cents per diluted share including one-time charges vs. $6 million or 2 cents per share a year ago.
Excluding one-time charges the company earned 11 cents per diluted share vs. pro forma 5 cents per share last year.
The results capped Park Place's first year as an independent company, after last year's spin-off from hotel giant Hilton Hotels Corp. (NYSE:HLT - news)
Analysts expected Park Place to report fourth quarter earnings of 11 cents per share, according to First Call/Thomson Financial.
Cash flow, or earnings before interest, taxes, depreciation and amortization, pre-opening expenses and non-cash items, a key indicator in the casino industry, rose 39 percent to $193 million from $139 million, Park Place said.
That was mainly due to success at the newly opened Paris Las Vegas Casino Resort, which sold-out New Year's Eve; expansion of two Gulf Coast resorts; successful marketing programs; and the ongoing cost savings efforts.
The $3 billion acquisition of the Caesars World properties, including Caesar's Palace on the Las Vegas Strip from Starwood Hotels & Resorts Worldwide Inc. (NYSE:HOT - news) was completed Dec. 29, Park Place said, and although its effect on the fourth quarter was minimal it is expected to boost results in the future.
``We are very proud of our accomplishments in our first year and look forward to continuing the momentum in 2000,' Chief Executive Arthur Goldberg said in a statement.
``We are working toward integrating Caesars and implementing processes and procedures that improve the product we deliver to our customers while optimizing operating efficiency.'
In the Western region, which includes Las Vegas, cash flow during the fourth quarter rose 67, boosted by the Paris, and also by the Nov. 13 Holyfield vs. Lewis heavyweight championship rematch that was co-hosted by Park Place.
Bally's Las Vegas, and the adjacent Paris Las Vegas produced a combined $54 million in cash flow in the fourth quarter vs. $17 million which Bally's posted on its own in 1998. Cash flow also rose at the Las Vegas Hilton which does a healthy convention business while it decreased slightly at the older Flamingo Hilton property.
Other Western Region cash flow at Reno Hilton and Flamingo Hilton in Laughlin rose 33 percent.
In the Eastern region which includes Atlantic City resorts, cash flow increased 33 percent in the fourth quarter to $44 million from from $33 million in 1998.
In the Gulf Coast, cash flow at Park Place's Grand Tunica rose 9 percent, the Grand Gulfport rose 22 percent, while the Grand Biloxi posted a 12 percent decrease due to competition from Mirage Resorts Inc.'s (NYSE:MIR - news) recently opened Beau Rivage resort.
On Dec. 23, the company opened its 52,000-square-foot casino expansion at Grand Casino Biloxi, which is expected to further boost results.
Fourth quarter results for the International region were $9 million vs. last year's $10 million as increases in both Australian resorts were offset by softness in Uruguay.
On Dec. 16, Park Place said it had entered into a definitive pact to sell the Flamingo Hilton Reno for $20 million. The deal, subject to regulatory approval, is expected to close June 30. The resort posted a $17 million non-cash, after-tax loss in the fourth quarter. |
