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Black Hawk Gaming Reports 68% Increase in Q2 Earnings

SECOND QUARTER RESULTS

Net income for the second quarter increased 66% to $1.5 million compared to net income of $930,000 for the second quarter of last year. Earnings per diluted share for the second quarter increased 68% to $0.37 per share compared to $0.22 per share for the comparable quarter last year. Second quarter net revenue increased 4% to $22.1 million from $21.3 million for the same quarter last year.

SIX MONTH RESULTS

Net income for the six-month period increased 77% to $3.3 million compared to $1.9 million for the six-month period last year. Earnings per diluted share for the six-month period increased 80% to $0.81 this year compared to $0.45 per share for the same period last year. Six-month net revenue increased 8% to $44.5 million from $41.1 million for the corresponding period last year.

``We are pleased with the performance of both the Lodge Casino and the Gilpin Hotel Casino in the second quarter. The combined gaming revenue of the two casinos represented approximately 19% of the gaming revenue in the City of Black Hawk in the second quarter and approximately 13% of the gaming revenue in the State of Colorado in the second quarter,'' said Jeffrey P. Jacobs, Chairman of the Board and CEO of Black Hawk Gaming.

Through June 30, 2000, the City of Black Hawk continued to dominate the Colorado gaming market, growing by 23% to $210 million of Adjusted Gross Proceeds, or 68% for the entire State. The Colorado gaming market remains strong with Adjusted Gross Proceeds for the year growing 16% to $309 million from $265 million.

The combined operations of the Gilpin Hotel Casino and The Lodge Casino at Black Hawk give Black Hawk Gaming approximately 1,300 gaming devices under management, making it the largest gaming based operator in the State of Colorado.

``Our agreement to acquire the Gold Dust West Casino in Reno as well as our licensing application in Nevada are moving along on schedule,'' said Jacobs.

The Gold Dust West is a casino located a few blocks to the west of Reno's downtown gaming district and offers 478 slot machines. The casino has been successful in catering to the ``locals'' market for the past 22 years.

Headquartered in Black Hawk, Colorado, Black Hawk Gaming & Development Company, Inc. is the owner and operator of the Gilpin Hotel Casino in Black Hawk, and 75% owner and operator of The Lodge Casino at Black Hawk.

    Financial Highlights
    (unaudited)
                             Three Months Ended        Six Months Ended
                                  June 30                  June 30
                              2000         1999        2000         1999

    Net Revenue           $22,130,000  $21,345,000 $44,494,000  $41,107,000
    Net Income             $1,542,000     $930,000  $3,343,000   $1,892,000
    Earnings per
     Diluted Share              $0.37        $0.22       $0.81        $0.45
    Weighted Average Shares
     Outstanding (Diluted)  4,166,449    4,173,764   4,150,303    4,163,904

    BALANCE SHEET DATA       June 30                December 31
                              2000                     1999

    Total Assets          $98,743,000             $101,080,000
    Total Liabilities and
     Minority Interest    $58,892,000              $64,581,000
    Shareholders' Equity  $39,851,000              $36,499,000

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