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COLORADO SPRINGS, Colorado, November 9 /PRNewswire/ --
Century Casinos, Inc. (NASDAQ Capital Market(R) and Vienna Stock
Exchange: CNTY) announced today the financial results for the three and nine
months ended September 30, 2009.
Third Quarter 2009
For the third quarter of 2009, net operating revenue from continuing
operations was US$13,724,000 and consolidated Adjusted EBITDA* was
US$2,554,000. This represents a 2% decrease in net operating revenue from
continuing operations over the same quarter of last year (US$13,966,000 in
the third quarter of 2008) and a less than 1% decrease in consolidated
Adjusted EBITDA* (US$2,568,000 in the third quarter of 2008). Net operating
revenue in Edmonton, Canada, as reported in U.S. dollars, was 10% lower than
the same period in 2008, but only declined by 5% in the local currency
(Canadian dollar). Management attributes the decline in net operating revenue
in Edmonton to a slow economy and road construction in front of the casino
during the summer of 2009 which adversely affected access to the casino. The
road construction ended the first week of November 2009. The reported results
were negatively affected by a 6% decrease in the average exchange rate
between the U.S. dollar and Canadian dollar in the third quarter of 2009
compared to the third quarter of 2008. This decline was offset by improved
net operating revenue at the Company's properties in Colorado, primarily due
to new gaming laws that went into effect on July 2, 2009.
Operating earnings from continuing operations were US$788,000 in the
third quarter of 2009 compared to operating losses from continuing operations
of US$8,927,000 for the third quarter of 2008, primarily due to improved
operations at the Company's Colorado properties and the impact of the
goodwill write off that was recorded during the third quarter of 2008. The
Company reported a loss from continuing operations of US$1,179,000, or a loss
of US$0.05 per basic and fully diluted share, for the third quarter of 2009,
compared to a loss of US$15,335,000, or a loss of US$0.65 per basic and fully
diluted share, for the third quarter of 2008. Adjusted for the one-time write
off of deferred financing charges and foreign currency transaction losses,
the loss from continuing operations is US$52,000*, or US$0.00 per basic and
fully diluted share, for the third quarter 2009. In addition to the increase
in operating earnings from continuing operations, the Company's loss from
continuing operations decreased in the third quarter of 2009 due to the
Company establishing a valuation allowance on its U.S. deferred taxes of
approximately US$6,021,000 during the third quarter of 2008. The tax effect
on net operating income or losses incurred in the U.S. will reduce or
increase this valuation allowance. The Company continues to not recognize tax
benefits on operating losses incurred in the U.S. As of September 30, 2009,
the Company has accumulated deferred tax assets of US$8.5 million which can
be applied against the tax on potential future U.S. income.
Including discontinued operations, the Company reported a net loss
attributable to Century Casinos, Inc. and subsidiaries of US$727,000, or a
loss of US$0.03 per basic and fully diluted share, for the third quarter of
2009. During the third quarter of 2009, the Company wrote off deferred
financing charges of approximately US$945,000 relating to debt at its Central
City property that was paid off in October 2009. The Company reported a net
loss attributable to Century Casinos, Inc. and subsidiaries of US$14,198,000,
or a loss of US$0.60 per basic and fully diluted share, for the third quarter
of 2008. During 2008, the Company recorded goodwill impairments of
US$9,357,000 and a valuation allowance of approximately US$6,021,000
established for U.S. deferred tax assets.
Nine months ended September 30, 2009
For the nine months ended September 30, 2009, net operating revenue from
continuing operations was US$37,607,000 and consolidated Adjusted EBITDA* was
US$6,216,000. This represents a 9% decrease in net operating revenue from
continuing operations over the same nine months of last year (US$41,369,000
for the nine months ended September 30, 2008) and a 9% decrease in
consolidated Adjusted EBITDA* (US$6,851,000 for the nine months ended
September 30, 2008), due to declines in net operating revenue at the
Company's properties in Colorado, resulting in a decrease in its Colorado
casinos' market share in the Cripple Creek and the Central City/Black Hawk
market. In addition, net operating revenue in Edmonton, Canada, as reported
in U.S. dollars, was 13% lower than the same period in 2008, but only down 1%
in the local currency (Canadian dollar). The reported results were negatively
affected by a 15% decrease in the average exchange rate between the U.S.
dollar and Canadian dollar for the nine months ended September 30, 2009,
compared to the same period in 2008.
Operating earnings from continuing operations were US$657,000 for the
nine months ended September 30, 2009 compared to operating losses of
US$8,704,000 for the nine months ended September 30, 2008, primarily due to
the impact of the goodwill write off that was recorded during the third
quarter of 2008, partially offset by a decrease in earnings of US$490,000
from the Company's equity investment in Casinos Poland in 2009. The Company
reported a loss from continuing operations of US$3,683,000, or a loss of
US$0.15 per basic and fully diluted share for the nine months ended September
30, 2009 and a loss of US$15,984,000, or a loss of US$0.69 per basic and
fully diluted share, for the same period in 2008. Adjusted for the one-time
write off of deferred financing charges and foreign currency transaction
losses, the loss from continuing operations is US$2,275,000* or a loss of
US$0.10 per basic and fully diluted share, for the nine months ended
September 30, 2009. In addition to the increase in operating earnings from
continuing operations, the Company's loss from continuing operations
decreased due to the Company establishing a valuation allowance on its U.S.
deferred taxes of approximately US$6,021,000 during the third quarter of
2008, partially offset by losses realized on the exchange of foreign currency
that reduced earnings by approximately US$462,000 in 2009, primarily due to
the transfer of currency between Mauritius and the U.S. The tax effect on net
operating income or losses incurred in the U.S. will reduce or increase this
valuation allowance. The Company continues to not recognize tax benefits on
operating losses incurred in the U.S. As of September 30, 2009, the Company
has accumulated deferred tax assets of US$8.5 million which can be applied
against the tax on potential future U.S. income.
Including discontinued operations, the Company reported net earnings
attributable to Century Casinos, Inc. and subsidiaries of US$18,521,000, or
US$0.79 per basic and fully diluted share, for the nine months ended
September 30, 2009. During the nine months ended September 30, 2009, the
Company reported a gain of US$20,277,000, or US$0.86 per basic and fully
diluted share, on the disposition of Century Casinos Africa ("CCA") and a
gain of US$915,000, or US$0.04 per basic and fully diluted share, on the
previously reported disposition of the Century Casino Millennium. The Company
reported a net loss attributable to Century Casinos, Inc. and subsidiaries of
US$12,822,000, or a loss of US$0.55 per basic and fully diluted share, for
the first nine months of 2008. During 2008, the Company recorded goodwill
impairments of US$9,357,000, or US$0.40 per basic and fully diluted share,
and a valuation allowance of approximately US$6,021,000, or US$0.26 per basic
and fully diluted share, established for U.S. deferred tax assets.
Update on Sale of CCA
On December 19, 2008, the Company, through a subsidiary, entered into an
agreement to sell all of the outstanding shares of CCA for a gross selling
price of ZAR 460.0 million (US$59.4 million) less the balance of third party
South African debt and other agreed to amounts. Net proceeds of ZAR 253.5
million (US$32.8 million) were paid to the Company at closing on June 30,
2009. CCA owned the Caledon Hotel, Spa & Casino and 60% of the Century Casino
& Hotel in Newcastle, Africa. On September 29, 2009, the Company received an
additional ZAR 17.3 million (US$2.3 million) that was previously held in
retention and an additional ZAR 3.2 million (US$0.4 million) for the increase
in the net asset value of CCA between December 31, 2008 and June 30, 2009.
Final transaction approval by the KwaZulu-Natal Gambling Board was
received on October 7, 2009. On October 14, 2009, the Company received the
final outstanding payment of ZAR 98.8 million (US$13.4 million). An
additional gain of ZAR 12.2 million (approximately US$1.6 million) will be
recorded in October 2009.
Net operating revenue from discontinued operations was US$11,248,000 for
the nine months ended September 30, 2009 compared to US$23,018,000 for the
nine months ended September 30, 2008. Earnings from discontinued operations
were US$23,140,000 and US$3,473,000 for the nine months ended September 30,
2009 and 2008, respectively. During the nine months ended September 30, 2009,
the Company recorded gains of US$20,277,000 and US$915,000 on the sales of
CCA and the Century Casino Millennium, respectively.
Property Results (Continuing Operations)
Century Casino & Hotel (Edmonton, Alberta, Canada) - Net operating
revenue at the Century Casino & Hotel in Edmonton decreased by 10% to
US$5,090,000 for the third quarter of 2009 compared to US$5,656,000 for the
third quarter of 2008, primarily due to a decline in gaming revenue and a
5.5% decline in the average exchange rate between the U.S. dollar and the
Canadian dollar. In Canadian dollars, net operating revenue decreased by 5%
to CAD 5,594,000 for the third quarter of 2009 compared to CAD 5,889,000 for
the third quarter of 2008. This decrease is the result of a decrease of 17%
in table revenue and 3.1% decrease in slot revenue. Management believes that
revenue at the Edmonton casino was negatively impacted by a slow economy and
that road construction in front of the casino during the summer of 2009
adversely affected access to the casino. The construction ended in the first
week of November 2009. Adjusted EBITDA* was US$1,776,000 for the third
quarter of 2009, a decrease of 13% from US$2,037,000 for the third quarter of
2008, which management attributes to the same factors above. In Canadian
dollars, Adjusted EBITDA* decreased by 8%, from CAD 2,127,000 for the three
months ended September 30, 2008 to CAD 1,953,000 for the three months ended
September 30, 2009.
Net operating revenue at the Century Casino & Hotel in Edmonton decreased
by 13% to US$14,729,000 for the nine months ended September 30, 2009 compared
to US$17,008,000 for the nine months ended September 30, 2008, due to a 15%
decline in the average exchange rate between the U.S. dollar and the Canadian
dollar and the road construction. In Canadian dollars, net operating revenue
decreased by 1% to CAD 17,215,000 for the first nine months of 2009 compared
to CAD 17,319,000 for the first nine months of 2008. Adjusted EBITDA* was
US$5,105,000 for the first nine months of 2009, a decrease of 18% from
US$6,213,000 for the first nine months of 2008, which management attributes
to the decline in the average exchange rate between the U.S. dollar and the
Canadian dollar. In Canadian dollars, Adjusted EBITDA* decreased by 6%, from
CAD 6,331,000 for the first nine months of 2008 to CAD 5,979,000 for the
first nine months of 2009.
Womacks Casino (Cripple Creek, Colorado, USA) - Net operating revenue at
Womacks Casino in Cripple Creek, Colorado increased 5% to US$3,246,000 for
the third quarter of 2009 from US$3,086,000 for the third quarter of 2008.
This is primarily attributable to an increase in gaming revenue resulting
from a change in Colorado gaming laws. On July 2, 2009, gaming establishments
in Colorado were permitted to raise the maximum betting limit to US$100, be
open for 24 hours and have roulette and craps tables. The Company implemented
these changes at its Colorado casinos. The Cripple Creek gaming market as a
whole increased by 2% during the third quarter of 2009. Womacks' Adjusted
EBITDA* for the third quarter of 2009 was US$768,000 compared to US$616,000
in the third quarter of 2008, an increase of 25%. The increase in Adjusted
EBITDA* is primarily due to the increase in revenue and a decrease in general
and administrative expenses, partially offset by an increase in gaming
expenses resulting from additional staffing and gaming taxes.
Net operating revenue at Womacks decreased 6% to US$8,259,000 for the
first nine months of 2009 from US$8,827,000 for the first nine months of
2008. This is mostly attributable to an 8% decrease in overall market share.
Our share of the slot machines in the Cripple Creek market declined 12%. The
Cripple Creek gaming market as a whole has remained flat, reflecting a down
market for the first six months of 2009, partially offset by an improved
market as of July 2009 resulting from the new gaming laws. The Company is
reviewing strategies to improve revenue at Womacks. Womacks' Adjusted EBITDA*
for the first nine months of 2009 was US$1,613,000 compared to US$1,329,000
for the first nine months of 2008, an increase of 21%. The increase in
Adjusted EBITDA* is primarily due to improved revenue resulting from the new
gaming laws and cost cutting measures at the casino.
Century Casino and Hotel (Central City, Colorado, USA) - Net operating
revenue at the Century Casino and Hotel in Central City increased 3% to
US$4,791,000 for the third quarter of 2009 compared to US$4,655,000 for the
third quarter of 2008, primarily due to an increase in gaming revenue which
management attributes to the new gaming laws. The combined Central City/Black
Hawk gaming market as a whole increased 10%. Our share of the Central City
gaming revenue decreased from 28.6% for the three months ended September 30,
2008 to 27.5% for the three months ended September 30, 2009. Adjusted EBITDA*
for the Century Casino & Hotel in Central City for the third quarter of 2009
decreased to US$1,176,000 compared to US$1,184,000 in the third quarter of
2008, a 1% decrease. The decrease is primarily due to an increase in gaming
expenses due to the cost of new hires and various start up expenses
associated with the new games and extended hours that were introduced as of
July 2, 2009.
Net operating revenue at the Century Casino and Hotel in Central City
decreased 4% to US$13,132,000 for the first nine months of 2009 compared to
US$13,679,000 reported for the first nine months of 2008. The Central
City/Black Hawk gaming market as a whole remained flat. Adjusted EBITDA* for
the Century Casino & Hotel in Central City decreased slightly to US$3,219,000
for the first nine months of 2009 compared to US$3,235,000 for the first nine
months of 2008. Management believes that cost cutting measures at the casino
have offset the decline in gaming revenue at the casino.
Cruise Ships - The Company's ship-based casinos contributed net operating
revenue of US$597,000 and Adjusted EBITDA* of US$156,000 for the third
quarter of 2009 compared to net operating revenue of US$569,000 and Adjusted
EBITDA* of US$79,000 for the third quarter of 2008. The ship-based casinos
contributed net operating revenue of US$1,487,000 and Adjusted EBITDA* of
US$266,000 for the first nine months of 2009 compared to net operating
revenue of US$1,852,000 and Adjusted EBITDA* of US$331,000 during the first
nine months of 2008. Management believes that the cruise ships have
significantly reduced their ticket prices in an effort to attract more
passengers. Management believes that this has resulted in consumers with less
discretionary income traveling on the ships, indirectly leading to less play
at the Company's casinos.
Corporate - Corporate operations reported negative Adjusted EBITDA* of
US$1,322,000 for the third quarter of 2009 compared to negative Adjusted
EBITDA* of US$1,348,000 for the third quarter of 2008. The slightly lower
negative Adjusted EBITDA* is primarily due to a decrease in general and
administrative expenses of US$212,000 resulting from a decrease in payroll
expenses and travel expenses, offset by a decrease in earnings recorded from
the Company's equity investment in Casinos Poland of US$185,000. The
Company's earnings from Casinos Poland decreased due to a decrease in gaming
revenue and a decline in the average exchange rate between the U.S. dollar
and the Polish zloty of 33% for the three months ended September 30, 2009
compared to the three months ended September 30, 2008. The Company's earnings
in Casinos Poland decreased by 76% from PLN 427,000 in the third quarter of
2008 to PLN 103,000 in the third quarter of 2009.
Corporate operations reported negative Adjusted EBITDA* of US$3,987,000
for the first nine months of 2009 compared to negative Adjusted EBITDA* of
US$4,257,000 for the first nine months of 2008. The lower negative Adjusted
EBITDA* is primarily due to a decrease in general and administrative expenses
of US$754,000 resulting from a decrease in payroll expenses, travel expenses
and professional fees. These decreases were offset by a decline in earnings
recorded from the Company's equity investment in Casinos Poland of
US$490,000. The Company's earnings from Casinos Poland decreased due to a
lower hold percentage on both slot and table games during the first quarter
of 2009 and a decline in the average exchange rate between the U.S. dollar
and the Polish zloty of 43% for the nine months ended September 30, 2009
compared to the nine months ended September 30, 2008. The Company's earnings
in Casinos Poland decreased by 45% from PLN 1,627,000 for the first nine
months of 2008 to PLN 887,000 for the first nine months of 2009.
The Company will post a copy of the Form 10-Q filed with the SEC for the
third quarter of 2009 on its web site at
www.cnty.com/corporate/investor/sec-filings/ on Monday, November 9, 2009.
On Monday, November 9, 2009, Century Casinos will host its Q3 2009
Earnings Conference Call, at 10:30 am MST; 6:30 pm CET, respectively. US
domestic participants please dial +1-800-895-0198; all other international
participants please use +1-785-424-1053 to dial in. Participants may also
listen to the call live or obtain a recording of the call on our website at
www.cnty.com/corporate/investor/financial-results/.
* See discussion and reconciliation of Non-GAAP financial measures in
Supplemental Information below.
(All figures in financial tables are in US$ unless otherwise noted)
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc.
Condensed Consolidated Statements of Earnings (Unaudited)
(Amounts in thousands, except for share information)
For the Three For the Nine
Months Ended Months Ended
September 30, September 30,
2009 2008 2009 2008
---- ---- ---- ----
Operating revenue:
Gaming $12,804 $13,122 $35,414 $39,108
Hotel, food
and beverage 2,279 2,396 6,215 6,594
Other 523 511 1,395 1,469
--- --- ----- -----
Gross revenue 15,606 16,029 43,024 47,171
Less
promotional
allowances 1,882 2,063 5,417 5,802
----- ----- ----- -----
Net operating
revenue 13,724 13,966 37,607 41,369
------ ------ ------ ------
Operating costs
and expenses:
Gaming 5,196 5,284 14,254 15,781
Hotel, food
and beverage 1,807 1,918 5,006 5,278
General and
administrative 4,440 4,793 13,318 15,299
Impairments
and other
write-offs - 9,357 - 9,357
Depreciation 1,526 1,759 4,648 5,124
----- ----- ----- -----
Total
operating
costs and
expenses 12,969 23,111 37,226 |
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