Colonial Downs Holdings, Inc. Reports 4th Quarter and 1998 Results
NEW KENT, Va. --(BUSINESS WIRE)--March 31, 1999--Colonial Downs
Holdings, Inc. (NASDAQ/NMS: CDWN) which, through its subsidiaries,
holds the only unlimited licenses to own and operate a pari-mutuel
horse racing course and satellite wagering facilities in Virginia,
today reported results of operations for the fourth quarter and fiscal
year ended December 31, 1998.
The Company reported revenues of $29,544,000 for the year ended
December 31, 1998 compared with revenues of $23,647,000 for 1997, an
increase of 24.9%. Direct operating expenses increased from
$19,100,000 in 1997 to $26,715,000 in 1998, an increase of 40%. The
net loss for the year ended 1998 was $5,288,000 compared with a
year-end profit of $8,000 for 1997. Revenues for the fourth quarter
were $7,257,000 compared with $6,033,000 for the same period in 1997,
an increase of 20%.
Direct operating expenses in the fourth quarter 1998 were
$4,218,000 compared with $5,253,000 in the same period in 1998, a
decrease of 20%. The net loss in the fourth quarter of 1998 was
$868,000 as compared with a net loss of $974,000 in the same period in
1997, a loss of $0.12 per share versus a loss of $0.13 per share,
respectively.
The increase in revenue during these periods as compared with the
same periods a year ago result from the operation of four racing
centers for the entire twelve months of 1998, 71 days of live racing
in 1998 versus 30 in 1997, and increased simulcast sales during live
race meets. The increase in operating expenses is principally
attributed to an increase in direct expenses resulting from an
increase in live racing days from 1997 to 1998, and increases in purse
expenses.
Commenting on the 1998 results, Chairman and Chief Executive
Officer Jeffrey P. Jacobs said, "As we have said for several months
now, given the cost structures in place during 1998, our losses are in
line with our projections. In the spring of last year, we realized
that we needed to make some definitive changes, so we developed a four
part plan to put Colonial Downs on a profitable track in January 1999.
The fundamental elements of the plan included re-negotiating the
Maryland Jockey Club management contract; re-negotiating the contracts
for the 1998 and 1999 live thoroughbred meets; implementing operating
efficiencies; and re-negotiating the 1999 harness meet contract. We
have implemented three of the four parts of our plan. We are working
with the thoroughbred horsemen towards a mutually satisfactory
arrangement for live thoroughbred racing in 1999. We expect the
results of our efforts to be evident in the 1st quarter of this year." |
