Nevada Gold & Casinos Announces Profit for First Quarter 2008
HOUSTON, Sept. 5, 2007 -- Nevada Gold & Casinos, Inc. (AMEX:UWN) today announced financial results for the first quarter ended July 29, 2007.
For the first quarter of fiscal 2008 net income was $0.5 million compared to a net loss of $1.8 million in the first quarter of fiscal 2007. The Company recorded earnings per diluted common share of $0.04, compared to net loss per diluted common share of $0.14 in the prior year period. Net revenues decreased to $2.0 million compared to $3.5 million in the first quarter ended July 30, 2006. Income before income tax expense for the first quarter of fiscal 2008 was $0.6 million compared to a loss before income tax expense of $2.8 million in the first quarter of fiscal 2007.
First quarter of fiscal 2008 financial results included the following significant items:
* A $1.3 million gain related to the sale of American Racing;
* Losses from American Racing totaling $0.8 million compared to a
$1.9 million loss a year ago;
* No credit enhancement fees due to the River Rock Entertainment
Authority ("RREA") buy-out transaction compared to $1.9 million in
the first quarter of fiscal 2007; and
* $38,000 of alternative minimum tax expense in the first quarter of
fiscal 2008, compared to a $1.0 million tax benefit a year ago;
Excluding the impact of non-recurring items, the Company would have recorded income before income tax expense of $41,000 compared to a loss of $2.8 million in the first quarter of last year.
Robert Sturges, CEO of Nevada Gold & Casinos, Inc., commented, "We are very pleased with our first quarter results, which reflect not only our progress with our operating initiatives, but also our ongoing financial discipline. Our success in decreasing corporate expenses and improving the performance of our existing projects exemplifies our commitment to building a sustainable business platform that will allow us to pursue growth opportunities. During the quarter we continued to redeploy our resources to the most compelling projects in our portfolio and we remain committed to divesting non-core assets. To that end we were pleased to complete the sale of American Racing in June 2007. We are continuing to evaluate acquisition opportunities, and believe that success on these fronts will enable us to further improve our results and build value for our shareholders."
Financial Results
For the first quarter of fiscal 2008, net revenues decreased to $2.0 million compared to $3.5 million in the first quarter of fiscal 2007. The revenue decrease is attributable to the elimination of credit enhancement fees in the first quarter as the result of the RREA buyout of future credit enhancement fees from the Dry Creek Casino, LLC of which the Company was a 69% owner.
Operating expenses decreased to $3.15 million from $4.3 million. Operating expenses included corporate expense of $1.25 million, a decrease of 29.6% compared to $1.78 million in the first quarter of fiscal 2007. Legal fees decreased to $0.1 million in the first quarter of fiscal 2008 from $0.8 in the same period last year. The Company's equity in earnings from Isle of Capri-Black Hawk (IC-BH), the Company's joint venture with Isle of Capri Casinos, was $1.9 million for the first quarter ended July 29, 2007, compared to $1.1 million a year ago. The Company's equity in earnings from American Racing was a loss of $0.8 million during the first quarter of fiscal 2008 compared to a loss of $1.9 million a year ago. The sale of American Racing was completed on June 14, 2007.
Net income for the first quarter of fiscal 2008 was $0.5 million compared to a net loss of $1.8 million in the first quarter of fiscal 2007. Net earnings per diluted common share were $0.04, compared to a net loss per diluted common share of $0.14 in the prior year period.
Diluted weighted average common shares outstanding in the first quarter were 12.9 million compared to 12.9 million in the prior year period.
Earnings Conference Call and Webcast
The Company will discuss first quarter financial results via the earnings conference call to be held today at 5:00 p.m. ET at www.nevadagold.com, Investor Relations, Events or by dialing (888) 202-2422 or (913) 981-5592 for international callers. If you are unable to participate, the conference call replay will be available by dialing (888) 203-1112 or 719-457-0820 for international callers. The replay access code is 7236408. In addition, the call will be archived on the Company's website through September 12, 2007.
Forward-Looking Statements
This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We use words such as "anticipate," "believe," "expect," "future," "intend," "plan," and similar expressions to identify forward-looking statements. Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional Indian gaming and other projects. These statements are only predictions and are subject to certain risks, uncertainties and assumptions, which are identified and described in the Company's public filings with the Securities and Exchange Commission.
About Nevada Gold & Casinos
Nevada Gold & Casinos, Inc. (AMEX:UWN) of Houston, Texas is a developer, owner and operator of gaming facilities and lodging entertainment facilities in Colorado and California. The Company owns a 43% interest in the Isle of Capri-Black Hawk LLC, which owns Isle of Capri-Black Hawk and Colorado Central Station, both of which are in Black Hawk, Colorado. Colorado Grande Casino in Cripple Creek, Colorado is wholly owned and operated by Nevada Gold. The Company also works with Native American tribes in a variety of capacities. Native American projects consist of a casino to be built in Pauma Valley, California for the La Jolla Band of Luiseno Indians and a casino to be developed by Buena Vista Development Company, LLC in the city of Ione, California for the Buena Vista Rancheria of Me-Wuk Indians. For more information, visit www.nevadagold.com.
Nevada Gold & Casinos, Inc.
Consolidated Statements of Operations
(unaudited)
Three Months Ended
---------------------------
July 29, July 30,
2007 2006
------------ ------------
Revenues:
Casino $ 1,893,241 $ 1,446,143
Food and beverage 412,195 375,733
Credit enhancement and management fees 40,174 1,946,086
Other 34,251 30,458
------------ ------------
Gross revenues 2,379,861 3,798,420
Less promotional allowances (399,484) (306,761)
------------ ------------
Net revenues 1,980,377 3,491,659
Casino 483,444 352,150
Food and beverage 194,883 232,593
Marketing and administrative 701,170 732,401
Facility 93,986 68,783
Corporate expense 1,250,304 1,775,638
Legal expense 121,257 805,870
Depreciation and amortization 202,413 262,152
Impairment of unconsolidated affiliate 100,000 --
Other 6,016 22,597
------------ ------------
Total operating expenses 3,153,473 4,252,184
------------ ------------
Operating loss (1,173,096) (760,525)
Non-operating income (expenses):
Earnings (loss) from unconsolidated
affiliates 1,189,889 (815,556)
Gain on sale of unconsolidated
affiliate 1,296,423 --
Gain on settlement of development
project 14,500 --
Interest expense, net (747,314) (862,107)
Minority interest -- (387,984)
------------ ------------
Income (loss) before income
tax (expense) benefit 580,402 (2,826,172)
Income tax (expense) benefit (37,916) 991,109
------------ ------------
Net income (loss) $ 542,486 $ (1,835,063)
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Per share information:
Net income (loss) per common share -
basic $ 0.04 $ (0.14)
============ ============
Net income (loss) per common share -
diluted $ 0.04 $ (0.14)
============ ============
Basic weighted average number of shares
outstanding 12,939,130 12,937,331
============ ============
Diluted weighted average number of
shares outstanding 12,939,130 12,937,331
============ ============
Nevada Gold & Casinos, Inc.
Consolidated Balance Sheets
July 29, April 29,
2007 2007
------------- -------------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 953,948 $ 2,803,560
Restricted Cash -- 1,050,000
Accounts receivable 92,108 397,145
Accounts receivable - affiliates 60,006 124,685
Prepaid expenses 654,269 474,933
Notes receivable, current portion 1,100,000 --
Notes receivable - development
projects, current portion -- 1,357,904
Other current assets 50,243 55,055
------------- -------------
Total current assets 2,910,574 6,263,282
------------- -------------
Investments in unconsolidated
affiliates 27,949,330 35,201,419
Investments in unconsolidated
affiliates held for sale 407,793 400,489
Investments in development projects 390,202 323,202
Investments in development projects
held for sale 3,918,744 3,914,765
Notes receivable 1,100,000 --
Notes receivable - affiliates 3,521,066 3,521,066
Notes receivable - development
projects, net of current portion 19,370,641 18,012,737
Goodwill 5,462,918 5,462,918
Property and equipment, net of
accumulated depreciation of
$1,483,150 and $1,281,191 at
July 29, 2007 and April 29, 2007,
respectively 1,967,477 2,063,026
Other assets 5,492,300 4,868,442
------------- -------------
Total assets $ 72,491,045 $ 80,031,346
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued
liabilities $ 1,391,746 $ 1,540,781
Accrued interest payable -- 21,211
Other accrued liabilities 83,093 378,937
Guaranty liabilities -- 4,610,000
Long-term debt, current maturities 830,632 2,066,518
------------- -------------
Total current liabilities 2,305,471 8,617,447
------------- -------------
Long-term debt, net of current
maturities 52,869,073 55,021,031
Deferred income 82,167 8,591
Other liabilities 803,247 742,991
------------- -------------
Total liabilities 56,059,958 64,390,060
------------- -------------
Commitments and contingencies -- --
Stockholders' equity:
Common stock, $0.12 par value per
share; 25,000,000 shares authorized;
13,935,330 shares issued and
12,939,130 outstanding at
July 29, 2007 and April 29, 2007,
respectively 1,672,240 1,672,240
Additional paid-in capital 18,729,763 18,484,448
Retained earnings 6,236,574 5,694,088
Treasury stock, 996,200 shares at
July 29, 2007 and April 29, 2007,
respectively, at cost (10,216,950) (10,216,950)
Accumulated other comprehensive income 9,460 7,460
------------- -------------
Total stockholders' equity 16,431,087 15,641,286
------------- -------------
Total liabilities and stockholders'
equity $ 72,491,045 $ 80,031,346
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CONTACT: Nevada Gold & Casinos, Inc.
Robert B. Sturges
(713) 621-2245
Integrated Corporate Relations
Don Duffy
(203) 682-8200
