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Gambling Companies Dividends Increase

KANSAS CITY, Missouri – As reported by the Kansas City Star: "Gambling companies are increasingly handing out quarterly jackpots to loyal shareholders.

"But these payouts aren't derived from playing the slots. They're in the form of old-fashioned dividends.

"Two years ago, casino-stock dividends were the stuff of investors' daydreams. But that changed in 2003, thanks to new laws that lowered the tax rate on dividends.

"The parent firm of Harrah's North Kansas City Casino & Hotel jumped on the dividend bandwagon in the second half of 2003 while the Ameristar group wrote its first post-tax-cut dividend checks to shareholders during the first quarter of 2004.

"…Earlier this month Harrah's announced its fourth consecutive 33-cent quarterly dividend after four quarters at 30 cents per share. Last Monday Ameristar's board declared a quarterly dividend of 15.625 cents, its second consecutive payment at that level following four quarters at 12.5 cents.

"…The American Shareholders Association reports the dividend tax reforms of 2003 reversed a general 25-year decline in the number of companies making regular quarterly dividend payments.

"…If recent corporate earnings trends — and local casinos' spending and promotions patterns — are any guide, casinos still have plenty of post-dividend cash in the bank to pay for new bells, whistles and freebies…"

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