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The Sands Regent Results Up

For the quarter-ended September 30, 2004, the Company reported consolidated net income of $1.6 million, or $0.29 per basic share, $0.27 diluted, as compared to consolidated net income of $1.1 million, or $0.22 per basic share, $0.20 diluted for the first quarter of 2004, ended September 30, 2003. Management attributed the year over year improvement primarily to strong performance of its Rail City property, which contributed $6.1 million to net revenues in its first full quarter of operations as a subsidiary of The Sands Regent. The net income comparison is even more favorable when a non-recurring gain of $230,000 in the first quarter of the prior fiscal year is excluded. In the first quarter ended September 30, 2004, the Company's income from operations improved 87.2% from $1.7 million in fiscal 2004 to $3.1 million in the most recent quarter. The improvement resulted from the inclusion of Rail City's results for the period, as income from operations at Gold Ranch decreased 6.2% and income from operations for the downtown Reno Sands Regency was unchanged at $1.3 million.

Net revenues improved by 37.4%, to $21.9 million from $15.9 million for the prior year period, reflecting a full quarter of strong Rail City results. EBITDAR increased 75.1% year over year, from $2.8 million in the first quarter of fiscal 2004 to $4.9 million in the first quarter of 2005.

On November 9, 2004, the Company announced that it has agreed to sell 1,120,000 shares of its common stock to institutional investors for $8.25 per share in cash in a private placement transaction. The gross proceeds of $9.24 million are expected to be used to repay outstanding debt and for general working capital purposes. Also in connection with the sale of the common stock, the Company issued warrants to the investors to purchase up to 360,000 additional shares of the Company's stock at a price of $10.66, exercisable beginning six months from the date of the closing and for a period of five years thereafter.

Ferenc B. Szony, President and CEO of The Sands Regent, commented, "The strong contributions from Rail City in its first full quarter as a Sands Regent property give us great confidence in our strategy for growth as a regional gaming and entertainment company. The financing we announced earlier this week allows us to open up credit for us to use for other applications, whether that be expansion of existing facilities or acquisitions. We like our market and where things are going these days."

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