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Aztar Reports Record Operating Cash Flow for Q3 2001

-- Operating cash flow (EBITDAR) of $54.5 million, up from $51.8 million in the 2000 quarter.

-- Operating income of $37.3 million, up from $33.8 million.

-- Net income of $17.8 million, up from $14.6 million last year.

-- Earnings per share of 46 cents, diluted, up from 34 cents per share a year earlier.

-- Operating cash flow margin of 25.0%, up from 23.3% last year.

``During our third quarter, we attained the highest level of operating cash flow in our company's history,'' said Paul E. Rubeli, Aztar chairman of the board, president and chief executive officer. ``Our diligent focus during the quarter on programs that produce revenues with higher profit components and on keeping tight control of expenses enabled us to produce our strong results.''

Operating cash flow, as measured by earnings before interest, taxes, depreciation, amortization and rent (EBITDAR) now has increased over the year- earlier quarter in 22 of the last 23 quarters. For the last 12 months through September, EBITDAR was $190.5 million, a 12-month record, topping the $187.8 million 12-month record reported in the previous quarter.

Tropicana Atlantic City

Tropicana Casino and Resort in Atlantic City reported third-quarter operating cash flow of $38.5 million, compared with $34.3 million in the comparable 2000 quarter, a 12.2% increase. Operating cash flow margin was 30.6%, up from 27.1% last year. EBITDAR during the past 12 months was $117.8 million, a second consecutive 12-month record.

Tropicana Las Vegas

Tropicana Resort and Casino in Las Vegas reported third-quarter operating cash flow of $5.6 million, compared to $7.0 million a year ago. Operating cash flow margin declined to 14.8% from 18.1% a year earlier. EBITDAR for the last 12 months was $27.5 million.

Ramada Express Laughlin

Ramada Express Hotel and Casino in Laughlin, Nevada reported third-quarter operating cash flow of $3.8 million, equal to the year-earlier quarter. Operating cash flow margin was 17.5% in the quarter, up from 16.8% in the 2000 third quarter. EBITDAR for the last 12 months was $21.7 million.

Casino Aztar Evansville

Casino Aztar, the company's riverboat casino in Evansville, Indiana, reported third-quarter operating cash flow of $8.4 million, compared with $9.0 million in the year-earlier quarter. Operating cash flow margin increased to 31.7% from 31.1% in the year-earlier quarter. EBITDAR for the last 12 months was $32.1 million.

Casino Aztar Caruthersville

Casino Aztar, the company's riverboat casino in Caruthersville, Missouri, reported $1.0 million of third-quarter operating cash flow, up from $0.7 million in the year-earlier period. Operating cash flow margin was 16.3%, up from 12.0%. EBITDAR for the last 12 months was $3.9 million.

Balance Sheet Items

Long-term debt, including the current portion, was $460 million at the end of the third quarter, compared with $451 million at the end of the second quarter. Cash and cash equivalents were $82 million at the end of the third quarter compared to $41 million at the end of the second quarter. The company's ratio of long-term debt to EBITDA was 2.7 times and EBITDA coverage of interest expense was 4.4 times. There were 36.8 million shares of common stock outstanding at the end of the third quarter.

Stock Repurchase

During the third quarter of 2001, the company purchased 583,200 shares of Aztar common stock at prices ranging from $10.52 per share to $16.10 per share at an average price of $13.07 per share. After the end of the third quarter, the company also purchased 303,700 shares, which was the balance remaining to be purchased under the company share repurchase authorization. From the beginning of the share repurchase program in May 1999 through its completion, the company purchased 11.0 million shares at prices ranging from $6.69 per share to $16.10 per share at an average price of $11.64 per share.

Year-to-date Results

For the first three quarters of 2001, the company reported EBITDAR of $153.9 million compared with $150.0 million for the same period in 2000; EBITDAR margin was 24.1% compared with 22.9%. Operating income was $101.1 million, compared with $96.6 million a year earlier. Net income for the first three quarters of 2001 was $45.2 million, equivalent to $1.15 per share, diluted, compared with $47.9 million, or $1.10 per share, diluted. The second quarter of 2000 included a non-recurring tax benefit of $7.5 million due to the favorable resolution of an issue in connection with Internal Revenue Service examinations of the company's tax returns for years 1989 through 1996.

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