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Ameristar Continues to Grow

2 February 2004

LAS VEGAS – (Press Release) -- Ameristar Casinos, Inc. (Nasdaq: ASCA) today announced fourth quarter 2003 results that exceeded management's previously issued guidance. Ameristar also announced record results for the year ended December 31, 2003.

"During 2003, we continued to successfully execute our key operating strategies designed to enhance the overall excitement of our facilities and improve our profitability," said Craig H. Neilsen, Chairman and CEO. "These strategies include capital enhancements at our premier properties, the implementation of leading slot technology and utilization of effective and efficient targeted marketing programs. We believe our record financial results for 2003 validate the effectiveness of our business strategies and strength of the Ameristar brand. We believe we are well positioned for continued financial success and future expansion."

Financial Results

Net Revenues

Net revenues for the fourth quarter of 2003 increased to $197.1 million, an 8.5% improvement from the prior-year quarter, led by double-digit percentage increases at Ameristar St. Charles, Ameristar Council Bluffs and Ameristar Vicksburg. Ameristar Kansas City posted a 5.8% increase in net revenues as the property completed its first full quarter of operations since the introduction of the "All New Ameristar Kansas City." In Jackpot, net revenues declined 1.4%; the Jackpot properties continue to be negatively impacted by increased competition from an Idaho Native American gaming facility which is closer to a portion of our market area and were also affected by adverse weather conditions in the fourth quarter of 2003.

For the fourth quarter of 2003, each of our properties ranked number one in gaming market share in its respective market. Ameristar Kansas City regained its market share lead following the completion of the "All New Ameristar Kansas City" in September 2003, with a 35.7% share of the market. Ameristar St. Charles posted a market share of 32.0%, which represents its highest quarterly market share since the opening of the new facility in August 2002. Ameristar Council Bluffs and Ameristar Vicksburg extended their long- time market leadership positions, reporting market shares of 40.1% and 43.5%, respectively. Management believes that Ameristar Vicksburg benefited from the sale of one of its competitors in October 2003.

Casino revenues for the fourth quarter of 2003 were $193.6 million, an increase of $15.3 million, or 8.6%, versus the prior-year quarter, including increases in slot revenues and table games revenues of 14.1% and 4.8%, respectively. We believe this increase is attributable to the continued successful execution of our operating strategies. In the fourth quarter of 2003, non-gaming revenues increased $4.3 million, or 12.6%, compared to the prior-year quarter. Food and beverage revenues were up 13.8% quarter-over- quarter as a result of the major enhancements to the Ameristar Kansas City dining and entertainment venues.

For the full year, we earned record net revenues of $782.0 million, an increase of $84.0 million, or 12.0%, over 2002. The most significant increase occurred at Ameristar St. Charles, which improved by $66.1 million, or 34.7%, as the property completed its first full year of operations with the new, much larger facility. Net revenues at Ameristar Council Bluffs increased by $11.3 million, or 7.8%, as the property continued to extend its market share lead.

Casino revenues for the year ended December 31, 2003 increased $81.7 million or 12.0%, from 2002, including increases in slot revenues and table games revenues of 16.5% and 10.4%, respectively. Non-gaming revenues increased $26.9 million, or 21.9%, in 2003 as compared to the prior year. The increase in non-gaming revenues was primarily due to a full year of operations of the new dining and entertainment venues at Ameristar St. Charles, which were completed in August 2002, and the major enhancements to the Ameristar Kansas City dining and entertainment venues during 2003.

Operating Income and EBITDA

In the 2003 fourth quarter, operating income increased 24.8% from the prior-year quarter to $31.4 million, notwithstanding a 5.9% increase in operating expenses, and EBITDA increased 21.3% to $48.3 million. Operating income and EBITDA for the fourth quarter of 2003 included a benefit for sales and use tax refunds of $1.2 million. Consolidated EBITDA margin improved dramatically, from 21.9% in the fourth quarter of 2002 to 24.5% in the fourth quarter of 2003, led by Ameristar Council Bluffs, which reported an EBITDA margin of 36.1%, an increase of 6.1 percentage points over the 2002 quarter. Ameristar St. Charles also improved its EBITDA margin to 31.7% in the 2003 quarter, due to a combination of revenue growth and increased operating efficiencies. At Ameristar Kansas City, EBITDA margin improved to 25.0% in the fourth quarter of 2003 from 22.8% in the fourth quarter of 2002. Management continues to focus on improving the margins at Ameristar Kansas City through labor efficiencies and other cost management initiatives. EBITDA margin declined quarter-over-quarter at both Ameristar Vicksburg and the Jackpot properties due to higher health care costs and general and administrative expenses. The improvements to consolidated operating income and consolidated EBITDA were achieved despite a $2.4 million increase in corporate expense for the same period. Corporate expense increased substantially as a result of the continued growth of the Company, the consolidation of certain management functions at the corporate level and the addition of corporate staff to position us for future expansion, and we expect this trend to continue in 2004.

Depreciation and amortization expense increased $2.2 million, from $14.7 million in the fourth quarter of 2002 to $16.9 million in the fourth quarter of 2003, primarily due to the increase in our depreciable assets resulting from the enhancement and renovation projects at Ameristar Kansas City and the implementation of coinless slot technology at all of our properties.

For the full year 2003, operating income and EBITDA reached record levels of $139.9 million and $203.5 million, respectively. Corporate expense increased $8.2 million, or 28.8%, in 2003 as a result of the consolidation of certain management functions at the corporate level, the addition of corporate staff, higher management bonuses, and costs incurred in 2003 related to the unsuccessful pursuit of a corporate acquisition.

Depreciation and amortization expense increased to $63.6 million for the year ended December 31, 2003 from $48.7 million in 2002. The increase was primarily due to a substantial increase in depreciable assets resulting from the completion of the new St. Charles facility in August 2002 and the implementation of coinless slot technology at all of our properties.

Net Income and Diluted Earnings Per Share

For the fourth quarter of 2003, net income and diluted earnings per share were $9.5 million and $0.35 per share, respectively, compared to $5.0 million and $0.19 per share, respectively, for the fourth quarter of 2002. Diluted earnings per share in the 2003 quarter benefited by $0.03 from the credit for sales and use tax refunds. Interest expense for the 2003 fourth quarter was $15.9 million, net of capitalized interest of $0.3 million, versus interest expense for the 2002 fourth quarter of $17.3 million, net of capitalized interest of $0.4 million. The decline in interest expense was due to a decrease in our long-term debt levels and lower interest rates on our senior credit facilities during 2003. During the three months ended December 31, 2003, we prepaid $15.0 million of principal under our senior credit facilities, which resulted in a loss on early retirement of debt of $0.3 million.

Net income for the full year 2003 increased to $47.6 million from $40.5 million in 2002, and diluted earnings per share improved to $1.76 from $1.50. Interest expense, net of capitalized interest from our ongoing construction projects, for 2003 increased to $64.3 million from $51.2 million in 2002 due to a substantial decrease in capitalized interest following the opening of the new St. Charles facility in August 2002. In 2003, we recorded capitalized interest of $1.6 million, primarily related to the enhancement and renovation projects at Ameristar Kansas City. Capitalized interest in 2002 was $17.9 million and was primarily related to the new St. Charles facility.

Our effective income tax rates for the quarter and year ended December 31, 2003 were 37.7% and 37.0%, respectively, compared to 37.3% and 36.5%, respectively, for the prior-year periods. The federal statutory rate was 35.0% in each year. The differences from the statutory rate were due to the effects of certain expenses we incurred which are not deductible for federal income tax purposes and certain tax credits.

Liquidity and Capital Resources

Our financial position remains strong, with approximately $78.2 million in cash and cash equivalents and $68.5 million of available borrowing capacity under our senior credit facilities at December 31, 2003. During 2003, we reduced our long-term debt by $81.6 million, including prepayments of $35.0 million of principal under our senior credit facilities and $14.9 million of other long-term debt. Capital expenditures for 2003 totaled $69.2 million, and included expenditures for the renovation of the casino, dining and entertainment areas at Ameristar Kansas City, capital enhancements at other properties, purchases of coinless slot machines and the implementation of new marketing and operations technology. For the year ended December 31, 2003, we generated free cash flow of $81.9 million compared to negative free cash flow of ($128.9) million in 2002. In 2002, free cash flow included $158.9 million of capital expenditures for the new casino and entertainment facility at St. Charles. Free cash flow is a non-GAAP financial measure, which we define as cash flows from operations, as defined in accordance with GAAP, less capital expenditures. The reconciliation of GAAP cash flows from operations to free cash flow is shown below.

Outlook

Based on our preliminary results of operations to date and our outlook for the remainder of the quarter, for the first quarter of 2004 we currently estimate operating income of $33.0 million to $35.0 million, EBITDA of $50.0 million to $52.0 million (given anticipated depreciation expense of $17.0 million), interest expense of $15.3 million and diluted earnings per share of $0.40 to $0.44.

For the year ending December 31, 2004, we currently estimate operating income of $144.0 million to $154.0 million, EBITDA of $215.0 million to $225.0 million (given anticipated depreciation expense of $71.0 million), interest expense of $57.1 million and diluted earnings per share of $1.94 to $2.16.

Free cash flow for the full year 2004 is expected to be $67.0 million to $77.0 million. We plan to utilize future free cash flow to continue reducing debt and to invest in future growth opportunities that diversify our revenues. We intend to reduce long-term debt by up to approximately $80.0 million in 2004. Our capital expenditures in 2004 are expected to be approximately $80.0 million, consisting of approximately $40.0 million for the purchase of additional coinless slots, $15.0 million for hotel room renovations at Ameristar Council Bluffs and Ameristar Kansas City and $25.0 million for other capital maintenance across all properties.

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