SEARCH NEWS:

 

Aztar Results Down

PHOENIX, Arizona – (PRESS RELEASE) -- Aztar Corporation (NYSE: AZR) today reported financial results for its 2004 fourth quarter, which ended on December 30, 2004; the fiscal 2003 quarter had ended on January 1, 2004. Consolidated EBITDA for the 2004 quarter was $25.6 million, which includes $1.7 million of insurance recovery related to the delay in the opening of the expansion of Tropicana Atlantic City; fourth-quarter 2004 EBITDA is after $0.7 million of expenses, related to the construction accident in Atlantic City that occurred on October 30, 2003, that may not be reimbursed by insurance, and also after $1.8 million of preopening costs. In the fourth quarter of 2003, EBITDA was $30.2 million, which was after $0.5 million attributable to construction-accident-related expenses.

Below operating income, results for the 2004 fourth quarter also included $3.6 million of other income consisting of insurance recoveries for the rebuilding of the damaged portions of the Tropicana Atlantic City expansion net of costs to dismantle and repair the damaged structure and $1.9 million of higher interest expense now that the company has discontinued capitalizing interest associated with the expansion project.

Diluted earnings per share in the 2004 fourth quarter were five cents, versus 32 cents in the 2003 quarter, which included 19 cents from an Internal Revenue Service settlement. Our Nevada and Missouri properties had strong results in the fourth quarter, with EBITDA growth of 25% in the aggregate, despite the unfavorable fiscal calendar, which did not include a New Year's holiday in the quarter. Results at our Indiana property were lower as a result of severe winter weather in the normally busy Christmas holiday period as well as the unfavorable fiscal calendar.

The Tropicana Atlantic City expansion opened on a limited basis on November 23, 2004. After adjusting for preopening costs and for construction-accident-related costs and insurance recoveries, Tropicana Atlantic City EBITDA declined $6.0 million from the year-earlier quarter. We estimate that $3.2 million of that decline is directly attributable to EBITDA lost as a result of the five-week strike conducted by the union that represents certain employees engaged in food, beverage and hotel services. Approximately $2.0 million of additional EBITDA decline occurred because of the absence of a New Year's Eve and Day during the fiscal quarter compared to the year-earlier quarter. The balance of the decline is the result of various additional payroll and other operating costs that were not yet fully offset by revenue growth.

"We are very pleased with the opening of the Tropicana Atlantic City expansion," said Paul E. Rubeli, Aztar chairman of the board and chief executive officer. "Customer reaction to The Quarter has been outstanding. Virtually all the dining, entertainment and retail outlets are now open, and our casino revenues continue to ramp up. Because of varied visitation rates, a large portion of our own database customers as well as other Atlantic City casino customers have yet to visit The Quarter and experience its fun and unique attractions. With the traditionally slow months of December and January now behind us, we expect continuing strong increases in casino revenue and EBITDA throughout the spring and summer months."

Disruption to Operations from Construction Accident

Operating results in the fourth quarter of 2004 continued to be impacted by the disruption that followed the construction accident that occurred on October 30, 2003, at the site of the expansion of Tropicana Atlantic City. Insurance claims for business interruption that occurred in the 2004 fourth quarter have been filed with the company's insurers in the amount of $6.1 million. Profit recovery from business interruption insurance is recorded when the amount of recovery, which may be different from the amount claimed, is agreed to by the insurers. If the insurers had agreed to the amount of the claims filed by the company on account of business interruption during the 2004 fourth quarter, that recovery would have contributed approximately 10 cents to diluted earnings per share for the quarter.

Capital Expenditures

In the fourth quarter of 2004, purchases of property and equipment totaled $44 million. Approximately $5 million of the total was spent on routine expenditures, and $39 million (including $2.6 million of capitalized interest) went for development.

Year-to-Date Results

For fiscal 2004, the company reported consolidated EBITDA of $165.4 million, which includes $12.2 million of insurance recoveries related to business interruption and the delay in the opening of the expansion of Tropicana Atlantic City. The 2004 EBITDA is after $6.2 million of expenses related to the construction accident that may not be reimbursed by insurance and also after $2.9 million of preopening costs. In fiscal 2003, EBITDA was $175.9 million, which was after $0.5 million attributable to construction-accident-related expenses. Diluted earnings per share for fiscal 2004 were 76 cents, which is after 19 cents associated with a loss on early retirement of debt and after 31 cents associated with an adverse state tax court ruling recorded in the first quarter of 2004; fiscal 2004 diluted earnings per share include 11 cents attributable to construction-accident- related insurance recoveries net of construction-accident-related expenses, including those included in other income, and preopening costs. The company reported net income equivalent to $1.66 per diluted share in fiscal 2003, which included 19 cents from an Internal Revenue Service settlement. The fourth quarter and fiscal year 2004 ended on December 30, 2004; the 2003 periods ended on January 1, 2004.

    Selected Results ($ in millions, except ADR, which is Average Daily Rate)

                                  Fourth Quarter             Fiscal Year
                                 2004        2003         2004         2003
                                   (unaudited)               (unaudited)

     Tropicana Atlantic City
     Revenue                    $93.5       $88.9       $404.7       $420.6
     EBITDA                      $7.9       $14.2        $81.8       $105.0
     Depreciation and
      amortization               $9.1        $7.3        $33.4        $29.9
     Operating income           $(1.2)       $6.9        $48.4        $75.1

     EBITDA margin                8.4%       16.0%        20.2%        25.0%
     Operating income margin     (1.3%)       7.8%        12.0         17.9%

     Occupancy                   76.7%       83.5%        88.2%        91.9%
     ADR                        $83.44      $83.36       $86.52       $85.85

     Tropicana Las Vegas
     Revenue                    $39.3       $37.3       $163.9       $153.6
     EBITDA                      $8.0        $6.2        $36.2        $26.1
     Depreciation and
      amortization               $1.4        $1.4         $5.9         $6.5
     Operating income            $6.6        $4.8        $30.3        $19.6

     EBITDA margin               20.4%       16.6%        22.1%        17.0%
     Operating income margin     16.8%       12.9%        18.5%        12.8%

     Occupancy                   94.3%       94.9%        98.2%        97.4%
     ADR                        $81.35      $72.88       $81.30       $70.66

     Ramada Express Laughlin
     Revenue                    $23.2       $21.8        $93.3        $89.8
     EBITDA                      $5.6        $4.7        $23.0        $20.5
     Depreciation and
      amortization               $1.7        $1.6         $6.3         $6.2
     Operating income            $3.9        $3.1        $16.7        $14.3

     EBITDA margin               24.1%       21.6%        24.7%        22.8%
     Operating income margin     16.8%       14.2%        17.9%        15.9%

     Occupancy                   66.4%       63.3%        70.2%        71.3%
     ADR                        $28.40      $28.36       $31.70       $29.61

     Casino Aztar Evansville
     Revenue                    $30.7       $31.9       $130.7       $126.0
     EBITDA                      $7.7        $8.5        $37.4        $35.8
     Depreciation and
      amortization               $2.0        $1.4         $6.6         $5.6
     Operating income            $5.7        $7.1        $30.8        $30.2

     EBITDA margin               25.1%       26.6%        28.6%        28.4%
     Operating income margin     18.6%       22.3%        23.6%        24.0%

     Occupancy                   81.3%       82.2%        87.1%        84.8%
     ADR                        $62.48      $61.09       $61.60       $63.45

     Casino Aztar Caruthersville
     Revenue                     $6.0        $5.4        $23.6        $23.1
     EBITDA                      $1.1        $0.9         $4.5         $4.2
     Depreciation and
      amortization               $0.8        $0.7         $2.9         $2.7
     Operating income            $0.3        $0.2         $1.6         $1.5

     EBITDA margin               18.3%       16.7%        19.1%        18.2%
     Operating income margin      5.0%        3.7%         6.8%         6.5%

     Corporate
     EBITDA                     $(4.7)      $(4.3)      $(17.5)      $(15.7)
     Depreciation and
      amortization               $0.0        $0.0         $0.0         $0.0
     Operating income           $(4.7)      $(4.3)      $(17.5)      $(15.7)

     Consolidated
     Revenue                   $192.7      $185.3       $816.2       $813.1
     EBITDA                     $25.6       $30.2       $165.4       $175.9
     Depreciation and
      amortization              $15.0       $12.4        $55.1        $50.9
     Operating income           $10.6       $17.8       $110.3       $125.0
     Net income                  $2.3       $11.7        $28.5        $60.9

     EBITDA margin               13.3%       16.3%        20.3%        21.6%
     Operating income margin      5.5%        9.6%        13.5%        15.4%
     Net income margin            1.2%        6.3%         3.5%         7.5%

< Gaming News