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Best of Howard Stutz

Gaming Guru

Howard Stutz
 

Full House Resorts narrows loss, still pursuing sale

7 November 2014

Regional casino operator Full House Resorts, Inc. reduced a quarterly net loss from a year ago while telling investors it would continue to pursue a sale of the Las Vegas-based company.

During a conference call Thursday, Full House Chairman and CEO Andre Hilliou asked stockholders to ignore overtures from a shareholder group headed by gaming executive Dan Lee that is seeking to remake the company’s board.

Hilliou wouldn’t answer questions about the proxy fight.

“Given the sensitivity and fluidity of this situation, we will not be taking any questions regarding the consent solicitation effort,” Hilliou said in his prepared remarks. “(We) will not be providing any additional commentary beyond the information we have already publicly filed.”

Last month, Full House put itself up for sale.

Full House, which operates three casinos in Fallon, Mississippi and Indiana and manages a casino in Lake Tahoe, said its net loss for the quarter that ended Sept. 30 was $800,000, compared to $2.2 million a year ago. The loss per share was 4 cents, compared to a loss of 11 cents per share in 2013 third quarter.

Overall revenue for Full House declined 12 percent to $32.9 million.

In a statement, Hilliou said cost containment measures companywide and gaming tax relief at the Rising Star Casino Resort in Indiana helped Full House “overcome the persistent regional gaming revenue weaknesses that we continue to experience.”

Full House Chief Operating Officer Mark Miller said the company is optimistic that recovery is taking place in regional gaming markets.

Full House is part of two investment groups bidding on two casino projects in upstate New York. Full House would operate the casinos under a management agreement. Hilliou said he expects the state to award licenses in the next two months.

Lee’s group controls 6.2 percent of Full House shares and received Securities and Exchange Commission permission last month to approach other company stockholders about a special meeting to vote on a board restructuring. The group wants to double the size of the board to 10 members.

A trust set up by the company’s late CEO that owns 9.4 percent of Full House sided with the shareholder group.

The proxy fight hasn’t drawn much interest from analysts.

Earlier this week, Lee’s group filed additional information with SEC, saying the company’s filings were “inaccurate and misleading.”

In the company’s statement, Full House said it “continues to encourage stockholders not to support the disruptive actions taken by the dissident stockholders.”