HOUSTON, June 14, 2005 -- Nevada Gold & Casinos, Inc. (AMEX:UWN) today announced financial results for the fourth quarter and fiscal year ended March 31, 2005.
For the fourth quarter of fiscal 2005, revenues increased to $2.3 million compared to $1.5 million in the fourth quarter of fiscal 2004. The revenue increase was primarily due to a $939,000 or 88% increase in credit enhancement fees from the River Rock project, which was somewhat offset by a decrease in interest income related to a lower weighted average balance in outstanding notes receivable from the River Rock project.
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 $2.1 million for the three months ended March 31, 2005, prior to a $4.0 million impairment charge related to the sale of the Colorado Grande Casino recorded by IC-BH which reduced the Company's equity in earnings by $1.7 million, compared to $2.2 million for the same period a year ago. IC-BH's fourth quarter adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA"), was $10.9 million compared to $10.5 million in the prior year period. A reconciliation of EBITDA to operating income is provided in the attached financial statements.
Net income for the fourth quarter of fiscal 2005 was $500,000 compared to $1.9 million in the fourth quarter of fiscal 2004. Net income per diluted common share excluding the impairment charge by IC-BH was $0.12, compared to $0.12 in the prior year period. Including the impairment charge of $1.7 million ($1.1 million after tax), our diluted earnings per share was $0.04. Diluted weighted average common shares outstanding in the fourth quarter were 14.3 million compared to 15.2 million in the prior year period. The decrease in the diluted shares was due to the Company's purchase and retirement of 1.1 million shares of the company's common stock.
H. Thomas Winn, Chairman, President and CEO of Nevada Gold & Casinos, Inc. commented, "We are pleased with our overall performance this fiscal year as we continued to make progress against our key growth initiatives of investing in existing projects to improve performance, signing new management and development contracts, and acquiring commercial gaming assets. We expect that growth investments made in fiscal 2005 will begin to generate financial benefits for shareholders in fiscal 2006 and beyond."
Fiscal 2005 Results
For fiscal 2005, revenues decreased to $7.4 million from $8.5 million in fiscal 2004. The revenue decrease was primarily due to a $3.1 million decrease in interest income related to a lower weighted average balance in outstanding notes receivable from the River Rock project, which was offset somewhat by an increase in credit enhancement fees from River Rock.
The Company's equity in earnings from IC-BH decreased to $5.9 million for fiscal 2005 compared to $10.2 million in the prior year period. IC-BH's EBITDA for fiscal 2005 was $39.7 million compared to $48.4 million for the prior year period. The decrease in earnings and EBITDA is attributable to the construction disruption related to the expansion project at IC-BH's two properties in Black Hawk, and the $4.0 million impairment charge related to the sale of the Colorado Grande Casino property.
Net income for fiscal 2005 was $4.2 million compared to $7.5 million in the prior year period. Net income per diluted common share was $0.29, compared to $0.51 in the prior year period. Diluted weighted average common shares outstanding in fiscal 2005 were 14.7 million compared to 15.4 million in the prior year period.
Earnings Conference Call and Webcast
The Company will discuss fiscal 2005 financial results and provide fiscal 2006 financial guidance via the earnings conference call to be held at 4:30 ET today via the internet at www.nevadagold.com, Investor Relations, Events. If you are unable to participate during the live webcast, the conference call replay will be available by dialing 1-888-203-1112 or 1-719-457-0820 for international callers. Replay Pin Number 4406228. In addition, the call will be archived on the Company's website, http://www.nevadagold.com, through June 21, 2005.
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 and Casinos, Inc. (AMEX:UWN) of Houston, Texas is a developer, owner and operator of gaming facilities and lodging and entertainment facilities in Colorado, California, Oklahoma and New Mexico. 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 from the right to lease gaming equipment to development and management of their gaming properties. Native American projects consist of River Rock Casino in Sonoma County, California, Route 66 Casino west of Albuquerque, New Mexico, a casino to be built in Tulsa, Oklahoma for the Muscogee (Creek) Nation, 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 the city of Ione, California for Buena Vista Rancheria of Me-Wuk Indians. For more information, visit http://www.nevadagold.com./
Nevada Gold & Casinos, Inc.
Consolidated Balance Sheets
March 31,
-------------------------
2005 2004
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $3,846,195 $3,528,631
Accounts receivable 794,435 216,322
Notes receivable - affiliates, current
portion 1,200,000 1,200,000
Income tax receivable 113,288 2,522,000
Other 227,303 79,272
------------ ------------
Total current assets 6,181,221 7,546,225
------------ ------------
Investments in unconsolidated affiliates 21,647,329 17,932,901
Investments in development projects 6,801,637 5,916,111
Notes receivable from Dry Creek Rancheria -- 10,000,000
Notes receivable - affiliates, net of
current portion 2,777,136 3,839,586
Notes receivable - development projects 6,562,323 295,174
Furniture, fixtures and equipment, net of
accumulated depreciation of $73,048 in 2005
and $124,609 in 2004 110,549 80,753
Deferred tax asset 618,282 --
Other 632,037 340,307
------------ ------------
Total assets $45,330,514 $45,951,057
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities $1,029,877 $1,205,241
Accrued interest payable 20,453 --
Long-term debt, current portion 3,317,499 --
Deferred tax liability -- 2,517,678
------------ ------------
Total current liabilities 4,367,829 3,722,919
------------ ------------
Long-term debt, net of current portion and
discount 9,632,773 11,029,266
Deferred income 178,835 145,833
------------ ------------
Total liabilities 14,179,437 14,898,018
------------ ------------
Commitments and Contingencies -- --
Minority interest 299,884 253,719
Stockholders' equity:
Common stock, $0.12 par value per share;
20,000,000 shares authorized; 12,755,203
and 12,279,352 shares issued and
outstanding at March 31, 2005 and 2004,
respectively 1,530,624 1,473,522
Additional paid-in capital 14,817,101 19,256,200
Retained earnings 14,419,719 10,261,455
Accumulated other comprehensive income (loss) 83,749 (191,857)
------------ ------------
Total stockholders' equity 30,851,193 30,799,320
------------ ------------
Total liabilities and stockholders' equity $45,330,514 $45,951,057
============ ============
Nevada Gold & Casinos, Inc.
Consolidated Statement of Operations
Year Ended March 31,
-----------------------------------
2005 2004 2003
----------- ----------- -----------
Revenues:
Credit enhancement fees $5,660,909 $3,643,037 $--
Interest income 1,683,063 4,803,981 2,892,638
Royalty income 67,610 62,439 50,000
Gain on land sale -- -- 589,916
Miscellaneous income -- 34,975 52,326
----------- ----------- -----------
Total 7,411,582 8,544,432 3,584,880
----------- ----------- -----------
Expenses:
General and administrative 1,258,122 822,444 503,845
Interest expense 1,722,979 3,095,077 2,436,117
Salaries and wages 2,105,425 1,078,008 920,175
Legal and professional fees 1,646,962 1,480,227 682,391
Amortization of deferred loan
issuance costs 327,544 1,031,786 554,375
Write-off of capitalized
development costs 180,850 245,356 238,437
Other 139,595 135,377 110,997
----------- ----------- -----------
Total 7,381,477 7,888,275 5,446,337
----------- ----------- -----------
Operating income (loss) 30,105 656,157 (1,861,457)
Minority interest expense (837,849) (561,697) (53,323)
Earnings from unconsolidated
affiliates 7,648,802 11,243,466 9,538,081
----------- ----------- -----------
Income before income tax expense 6,841,058 11,337,926 7,623,301
----------- ----------- -----------
Income tax expense (2,682,794) (3,813,870) (2,298,373)
----------- ----------- -----------
Net income $4,158,264 $7,524,056 $5,324,928
=========== =========== ===========
Per share Information:
Net income per common share - basic
net income $0.33 $0.65 $0.49
=========== =========== ===========
Net income per common share -
diluted net income $0.29 $0.51 $0.37
=========== =========== ===========
Basic weighted average number of
shares outstanding 12,788,269 11,534,889 10,969,287
=========== =========== ===========
Diluted weighted average number of
shares outstanding 14,672,777 15,425,427 15,555,956
=========== =========== ===========
Nevada Gold & Casinos, Inc.
Consolidated Statement of Operations
Three Months Ended
-----------------------
March 31,
-----------------------
2005 2004
----------- -----------
Revenues:
Credit enhancement fees $2,005,254 $1,066,111
Interest income 312,602 455,022
Royalty income 16,902 16,902
----------- -----------
Total 2,334,758 1,538,035
----------- -----------
Expenses:
General and administrative 496,209 155,416
Interest expense 392,224 285,396
Salaries and wages 549,379 184,590
Legal and professional fees 398,128 398,190
Amortization of deferred loan issuance costs 34,629 71,702
Write-off of capitalized development costs -- 221,953
Other (3,284) 15,702
----------- -----------
Total 1,867,285 1,332,949
----------- -----------
Operating income (loss) 467,473 205,086
Minority interest expense (291,577) (165,617)
Earnings from unconsolidated affiliates 884,797 2,658,633
----------- -----------
Income before income tax expense 1,060,693 2,698,102
----------- -----------
Income tax expense (561,002) (840,117)
----------- -----------
Net income $499,691 $1,857,985
=========== ===========
Per share Information:
Net income per common share - basic net
income $0.04 $0.15
=========== ===========
Net income per common share - diluted net
income $0.04 $0.12
=========== ===========
Basic weighted average number of shares
outstanding 12,754,303 12,058,359
=========== ===========
Diluted weighted average number of shares
outstanding 14,278,176 15,179,594
=========== ===========
Isle of Capri Black Hawk L.L.C.
Comparative Financial Highlights on Continuing
Operations by Casino Property
(In thousands)
Three Months Ended
------------------------------------------------------
April 24, 2005 April 25, 2004
-------------------------- ---------------------------
Adjusted Adjusted
Net Adjusted EBITDA Net Adjusted EBITDA
Revenues EBITDA Margin Revenues EBITDA Margin
(1) (2) % (2) (3) (2) % (2)
-------------------------- ---------------------------
Isle-Black Hawk
(3) 28,369 9,669 34.1% 25,655 9,467 36.9%
Colorado
Central
Station (3) 9,971 1,252 12.6% 8,657 1,057 12.2%
------------------------------------------ ---------------------------
Total 38,340 10,921 28.5% 34,312 10,524 30.7%
Fiscal Year Ended
------------------------------------------------------
April 24, 2005 April 25, 2004
-------------------------- ---------------------------
Adjusted Adjusted
Net Adjusted EBITDA Net Adjusted EBITDA
Revenues EBITDA Margin Revenues EBITDA Margin
(1) (2) % (2) (1) (2) % (2)
-------------------------- ---------------------------
Isle-Black Hawk
(3) 104,974 37,233 35.5% 106,356 39,886 37.5%
Colorado
Central
Station (3) 33,614 2,464 7.3% 42,560 8,493 20.0%
----------------------------------------- ---------------------------
Total 138,588 39,697 28.6% 148,916 48,379 32.5%
Isle of Capri Black Hawk L.L.C.
Reconciliation of Adjusted EBITDA to Operating Income (Loss) from
Continuing Operations by Casino Property
(in thousands)
Three Months Ended April 24, 2005
------------------------------------------------------
Operating
Depreciation Income
Adjusted & Operating Margin
EBITDA (2) Amortization Income % (4)
------------------------------------------------------
Isle-Black Hawk
(3) 9,669 (1,895) 7,774 27.4%
Colorado
Central
Station (3) 1,252 (901) 351 3.5%
---------------------------------------------------------------------
Total 10,921 (2,796) 8,125 21.2%
Three Months Ended April 25, 2004
------------------------------------------------------
Operating
Depreciation Income
Adjusted & Operating Margin
EBITDA (2) Amortization Income % (4)
------------------------------------------------------
Isle-Black Hawk
(3) 9,467 (1,684) 7,783 30.3%
Colorado
Central
Station (3) 1,057 (542) 515 5.9%
---------------------------------------------------------------------
Total 10,524 (2,226) 8,298 24.2%
Isle of Capri Black Hawk L.L.C.
Reconciliation of Adjusted EBITDA to Operating Income (Loss) from
Continuing Operations by Casino Property
(in thousands)
Fiscal Year Ended April 24, 2005
Depreciation Operating Operating
Adjusted & Income Income (Loss)
EBITDA (2) Amortization (Loss) Margin % (4)
-------------------------------------------------------
Isle-Black
Hawk (3) 37,233 (7,171) 30,062 28.6%
Colorado
Central
Station (3) 2,464 (2,765) (301) (0.9%)
--------------------------------------------------------------------
Total 39,697 (9,936) 29,761 21.5%
Fiscal Year Ended April 25, 2004
-------------------------------------------------------
Depreciation Operating
Adjusted & Operating Income
EBITDA (2) Amortization Income Margin % (4)
-------------------------------------------------------
Isle-Black
Hawk (3) 39,886 (6,777) 33,109 31.1%
Colorado
Central
Station (3) 8,493 (1,648) 6,845 16.1%
-------------------------------------------------------------------
Total 48,379 (8,425) 39,954 26.8%
Isle of Capri Black Hawk L.L.C.
Reconciliation of Operating Income to Net Income (Loss)
by Casino Property
(In thousands)
Three Months Ended April 24, 2005
----------------------------------------
Operating Interest Interest Management
Income Expense Income Fee
----------------------------------------
Isle-Black Hawk (3) 7,774 (1,066) 10 (1,291)
Colorado Central Station (3) 351 (1,368) 1 (369)
Colorado Grande (3)(5) - (57) - (62)
----------------------------------------------------------------------
Total 8,125 (2,491) 11 (1,722)
Three Months Ended April 25, 2004
----------------------------------------
Operating Interest Interest Management
Income Expense Income Fee
----------------------------------------
Isle-Black Hawk (3) 7,783 (667) 30 (1,245)
Colorado Central Station (3) 515 (1,368) - (339)
Colorado Grande (3)(5) - (185) - (99)
----------------------------------------------------------------------
Total 8,298 (2,220) 30 (1,683)
----------------------------------------
Loss from
Discontinuing
Operation,
Income tax net of Income Net
benefit Tax Income(Loss)
----------------------------------------
Isle-Black Hawk (3) - - 5,427
Colorado Central Station (3) 545 - (840)
Colorado Grande (3)(5) 77 (3,685) (3,727)
---------------------------------------------------------------------
Total 622 (3,685) 860
Three Months Ended April 25, 2004
----------------------------------------
Gain from
Discontinuing
Income tax Operation,
(provision) net of Income Net
benefit Tax Income(Loss)
----------------------------------------
Isle-Black Hawk (3) - - 5,901
Colorado Central Station (3) 443 - (749)
Colorado Grande (3)(5) (42) 352 26
---------------------------------------------------------------------
Total 401 352 5,178
Isle of Capri Black Hawk L.L.C.
Reconciliation of Operating Income (Loss) to
Net Income (Loss) by Casino Property
(In thousands)
Fiscal Year Ended April 24, 2005
---------------------------------------------
Operating
Income Interest Interest Management
(Loss) Expense Income Fee
---------------------------------------------
Isle-Black Hawk (3) 30,062 (3,374) 63 (4,974)
Colorado Central
Station (3) (301) (5,474) 8 (1,103)
Colorado Grande (3) - (613) - (297)
--------------------------------------------------------------------
Total 29,761 (9,461) 71 (6,374)
Fiscal Year Ended April 25, 2004
--------------------------------------------
Operating Interest Interest Management
Income Expense Income Fee
--------------------------------------------
Isle-Black Hawk (3) 33,109 (4,575) 123 (4,889)
Colorado Central
Station (3) 6,845 (5,460) 2 (1,902)
Colorado Grande (3) - (737) - (382)
---------------------------------------------------------------------
Total 39,954 (10,772) 125 (7,173)
--------------------------------------------
Loss from
Discontinuing
Income tax Operation, net Net
benefit of Income Tax Income(Loss)
--------------------------------------------
Isle-Black Hawk (3) - - 21,780
Colorado Central - -
Station (3) 2,642 - (4,228)
Colorado Grande (3) - (2,946) (3,856)
---------------------------------------------------------------------
Total 2,642 (2,946) 13,693
Fiscal Year Ended April 25, 2004
--------------------------------------------
Gain from
Discontinuing
Income tax Operation, net Net
benefit of Income Tax Income(Loss)
--------------------------------------------
Isle-Black Hawk (3) - - 23,768
Colorado Central
Station (3) 111 - (404)
Colorado Grande (3) - 1,418 299
---------------------------------------------------------------------
Total 111 1,418 23,663
(1) Net revenues are presented net of complimentaries, slot points
expense and cash coupon redemptions.
(2) EBITDA is "earnings before interest, income taxes, depreciation
and amortization." Adjusted EBITDA for each property was
calculated by adding preopening expense, management fees and
non-cash items to EBITDA. Adjusted EBITDA is presented solely as a
supplemental disclosure because management believes that it is 1)
a widely used measure of operating performance in the gaming
industry, and 2) a principal basis for valuation of gaming
companies. Management uses property level Adjusted EBITDA
(Adjusted EBITDA before corporate expense) as the primary measure
of the properties' performance. Adjusted EBITDA should not be
construed as an alternative to operating income, as an indicator
of the Company's operating performance; or as an alternative to
any other measure determined in accordance with accounting
principles generally accepted in the United States. The properties
have significant uses of cash flows, including capital
expenditures, interest payments, taxes and debt principal
repayment, which are not reflected in Adjusted EBITDA. Also, other
gaming companies that report Adjusted EBITDA information may
calculate Adjusted EBITDA in a different manner than the Company.
Adjusted EBITDA Margin percentage is calculated by dividing
Adjusted EBITDA by net revenue. Reconciliations of operating
income to Adjusted EBITDA are included in the financial schedules
accompanying this release.
(3) The Isle of Capri Black Hawk L.L.C. acquired these properties on
April 22, 2003.
(4) Operating income margin was calculated by dividing operating
income by net revenue.
(5) Colorado Grande is considered a discontinued operation of IC-BH
due to our purchase on April 25, 2005.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Nevada Gold & Casinos Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.
Contacts: Nevada Gold & Casinos, Inc.
H. Thomas Winn or Christopher Domijan
713-621-2245
Integrated Corporate Relations
Don Duffy
203-682-8200
