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Isle of Capri Casinos Inc. Reports Operating Results (10-Q)

December 04, 2009 | About:
10qk

10qk

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Isle of Capri Casinos Inc. (ISLE) filed Quarterly Report for the period ended 2009-10-25.

Isle of Capri Casinos is a developer, owner and operator of branded gaming and related lodging and entertainment facilities in growing markets in the United States. The company wholly or partially owns and operates gaming facilities under the name ``Isle of Capri``. In addition, the company wholly owns and operates a pari-mutuel harness racing facility and owns interests in and operates gaming activities aboard a cruise ship based. Isle Of Capri Casinos Inc. has a market cap of $241.5 million; its shares were traded at around $7.48 with and P/S ratio of 0.2. Isle Of Capri Casinos Inc. had an annual average earning growth of 3.3% over the past 10 years.

Highlight of Business Operations:

Colorado and Missouri Gaming Law Changes In early July 2009, gaming law changes became effective in Colorado which allowed extended hours of operations, expanded the types of allowable table games and increased the betting limit from $5 to $100 per bet. During November 2008, gaming law changes became effective in Missouri which repealed the $500 loss limit. Our gaming revenues reflect the favorable impact of these changes in state gaming laws.

Expense Recoveries and Other Charges During the three months ended October 25, 2009 we recorded an other expense recovery of $6.8 million representing the discounted value of a receivable for reimbursement of development costs expensed in prior periods relating to a terminated plan to develop a casino in Pittsburgh, Pennsylvania. This receivable was recorded following our current assessment of collectability. During the six months ended October 26, 2008, we recorded charges of $6.0 million following our agreement to terminate the development of a potential casino project in Portland, Oregon.

Casino Revenues - Casino revenues increased $0.4 million, or 0.1%, and decreased $12.5 million or 2.4% for the three and six months ended October 25 2009, as compared to the same periods in the prior fiscal year. For the three months ended October 25, 2009, casino revenues: increased by $6.0 million at our Missouri and Colorado properties reflecting the benefit of regulatory changes; increased by $3.6 million at our Lake Charles property

reflecting the prior year closure due to hurricanes; decreased by $6.2 million at our Quad Cities and Pompano properties reflecting the impact of competition; and decreased by $3.0 million at other properties primarily due to current economic conditions. For the six months ended October 25, 2009, casino revenues: increased by $7.6 million at our Missouri and Colorado properties reflecting the benefit of regulatory changes; increased by $1.5 million at our Lake Charles property reflecting the prior year closure due to hurricanes; decreased by $13.2 million at our Quad Cities and Pompano properties reflecting the impact of competition; and decreased by $8.4 million at other properties primarily due to current economic conditions.

Pari-mutuel, Food, Beverage and Other Revenues Pari-mutuel, food, beverage and other revenues increased $0.8 million, or 2.4%, and decreased $0.9 million or 1.3% for the three and six months ended October 25, 2009, as compared to the same periods in the prior fiscal year. The increase in these revenues for the three months ended October 25, 2009, reflects an overall increase in food, beverage and other revenues of $1.6 million offset by decreased pari-mutuel revenues. The decrease in these revenues for the six months ended October 25, 2009, reflects a $2.1 million decrease in pari-mutuel revenues offset by an increase of $1.2 million in food, beverage and other revenues. The reduction in pari-mutuel revenues is a result of a reduction in live racing days during the first half of our current fiscal year.

Casino - Casino operating expenses increased $2.5 million, or 6.6%, in the three months ended October 25, 2009, and increased $4.0 million or 5.2% for the six months ended October 25, 2009, as compared to the same period in the prior fiscal year. The majority of this increase in casino operating expense was incurred at our Black Hawk properties in advance of and after the new gaming laws became effective and at our Lake Charles property as our prior fiscal year expenses were reduced by the impact of hurricane closures.

Read the The complete ReportISLE is in the portfolios of George Soros of Soros Fund Management LLC, Bruce Kovner of Caxton Associates.

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10qk
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