Empire Resorts reports Q4 results

15 March 2007

LAS VEGAS, Nevada -- (PRESS RELEASE) -- Empire Resorts, Inc. (NASDAQ: NYNY) today reported financial results for the fourth quarter and twelve months ended December 31, 2006.

Net revenue for the fourth quarter was $20.8 million, down 7.2% from the $22.5 million reported in the fourth quarter of 2005. Revenue from racing declined by approximately $1.3 million, or 25%, reflecting decreased revenue allocations from OTB facilities, while revenue from the company's video gaming machine (VGM) business fell by approximately $0.4 million, or 2%, due to increased competition in the region. Empire's VGM operations experienced a slight decline in daily visits of roughly 2%, and the daily win per unit also fell 2% to $110.76 for the quarter from $113.34 in the fourth quarter of 2005.

The company's operating loss for the quarter was $(3.4) million versus $(10.1) million in the prior-year period, which included a $11.9 million impairment charge related to deferred development costs. SG&A expense rose to $7.1 million in the fourth quarter of 2006 from $3.4 million in 2005, primarily due to an increase in stock-based compensation of $3.5 million associated with the modification of the option agreement with Concord Associates. EBITDA was $(3.1) million for the quarter compared with $(9.8) million in the fourth quarter of 2005. The company posted a net loss for the fourth quarter of $(5.5) million, or $(0.20) per diluted share, compared with a net loss of $(12.1) million, or $(0.46) per diluted share, in 2005.

For fiscal 2006, Empire reported record net revenue of $98.1 million versus $86.8 million in the same period last year, reflecting growth in the company's racing and VGM operations. EBITDA was $0.7 million for the twelve month period, as compared with $(12.1) million last year. Empire's net loss for 2006 was $(8.6) million, or $(0.32) per diluted share, versus a net loss of $(20.1) million, or $(0.77) per diluted share, for 2005. Included in the 2005 results are $14.3 million of impairment charges for deferred development costs.

"This year was one of significant progress for Empire Resorts," commented David Hanlon, CEO and president. "In the past twelve months, we saw our Monticello operations post record revenue even as we took the final steps towards building a world-class casino in the Catskills with our partners, the St. Regis Mohawks. At the end of 2006, the Department of the Interior finally issued a Finding of No Significant Impact, or FONSI, regarding this monumental endeavor, and, more recently, Governor Spitzer gave his concurrence to move forward while also approving the Tribal-State Compact Amendment, authorizing gaming at Monticello. We now await a decision regarding putting our land into trust, and we are optimistic that this will take place in the near future.

"Empire Resorts looks forward to the day when we can announce the groundbreaking for the St. Regis Mohawk casino, a premier resort that will create 11,000 jobs and bring a competitive level of gaming to New York state. We appreciate the ongoing efforts of Governor Spitzer and other elected officials in supporting this economic growth engine for the Catskills. While we prepare for the casino development, we continue to work to improve our current Monticello operations and have undertaken new marketing initiatives to retain our standing in the region; at the same time, we look towards potential gaming opportunities outside of New York - all of which positions us for sustained growth in the years ahead."