Isle of Capri Casinos, Inc. Announces Fiscal 2010 Fourth Quarter and Year End Results

Jun 02, 2010, 08:30 ET from Isle of Capri Casinos, Inc.

ST. LOUIS, June 2 /PRNewswire-FirstCall/ -- Isle of Capri Casinos, Inc. (Nasdaq: ISLE) (the "Company") today reported financial results for the fourth quarter and fiscal year ended April 25, 2010, and other Company-related news.  

In making the announcement, the Company pointed to a series of accomplishments during the quarter and past fiscal year.  Specifically, the Company:

  • Nears completion of the acquisition of Rainbow Casino in Vicksburg, Mississippi;
  • Reduced property-level operating expenses by $12 million in fiscal year 2010, totaling over $32 million in cost reductions over the past two fiscal years;
  • Increased See. Say. Smile. customer satisfaction scores to 90%; an increase of 300 bps from 60% two years ago; and
  • Amended the leverage and interest coverage covenants of its senior credit facility.

James B. Perry, the Company's chairman and chief executive officer, said, "Our results show clearly that we have remained committed to our goal of fiscal responsibility through this difficult economic cycle.  Preliminary data suggests that consumer spending may be beginning to slowly rebound and we are pleased that we have been able to re-engineer the costs associated with our business while consistently improving the guest experience across our portfolio.  In addition to these efforts, we have continued to make every effort to improve our balance sheet, and are actively exploring options for deploying capital to maximize value for our shareholders, including possible acquisitions, greenfield developments and management opportunities in a variety of jurisdictions.  As we look forward to completing the Rainbow acquisition as a component of our overall strategy, we will continue to fine-tune our operating model and evaluate potential opportunities with the clear goal of increased profitability and free cash flow."

Consolidated Results

The following table outlines the Company's financial results (dollars in millions, except per share data, unaudited):

Quarter Ended

Fiscal Year Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

Net revenues, excluding insurance recoveries

$          268.8

$          281.7

$          999.8

$       1,046.2

Net revenues

268.8

284.6

999.8

1,108.0

EBITDA(1)

53.1

34.4

173.6

257.0

Income (loss) from continuing operations

6.4

25.6

(1.5)

61.2

Net income (loss)

4.9

14.6

(3.3)

43.6

Income (loss) per share from continuing

 operations

0.20

0.80

(0.05)

1.95

Net income (loss) per share

0.15

0.46

(0.10)

1.39

During the fourth quarter of fiscal 2010, net revenues decreased 5.6% to $268.8 million, when compared to prior year, while consolidated EBITDA increased 54.4% to $53.1 from $34.4 million.  This increase in EBITDA was caused primarily by valuation charges taken in FY 2009 offset by decreases in revenue.  

For the fiscal year ended April 25, 2010, net revenues decreased 9.8% to $999.8 million, when compared to prior year, and consolidated EBITDA decreased 32.5% to $173.6 million.  The decrease in EBITDA is primarily attributable to the decrease in net revenues, insurance recoveries received in FY 2009 offset by the 2009 valuation charges as discussed above.

The following table outlines significant items impacting EBITDA and the Income (loss) from continuing operations during the fiscal quarters and years ended April 25, 2010 and April 26, 2009:

Quarter Ended

Fiscal Year Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

Items impacting EBITDA and Income (loss)

 from continuing operations:

    Insurance recoveries, net

$                -

$              3.0

$                -

$            94.1

    Valuation charges

-

(30.1)

-

(30.1)

    Expense recoveries and other

-

6.8

(6.0)

    Debt refinancing costs

(1.8)

-

(1.8)

-

    Other

-

2.3

0.4

-

Additional item impacting Income (loss)

 from continuing operations:

    Gain on early extinguishment of debt

-

57.7

-

57.7

Before considering the impact of the items detailed in the table above during the fourth quarter of fiscal 2010:

  • Net revenues decreased 4.6% to $268.8 million
  • Property-level EBITDA margins were 24.5% compared to 24.1% in the fourth quarter of fiscal year 2009
  • Consolidated EBITDA decreased 7.2% to $54.9 million, primarily as a result of increased corporate development costs of approximately $0.9 million and decreased gaming revenues

Before considering the impact of the items detailed in the table above, annual results were as follows:

  • Net revenues decreased 4.4% to $999.8 million
  • Property-level EBITDA margins were 21.2% compared to 22.9% in fiscal year 2009
  • Consolidated EBITDA decreased 15.5% to $168.2 million, primarily as a result of decreased gaming revenues

Discussing the operating results, Virginia McDowell, the Company's president and chief operating officer, remarked, "We are continuing to build a stronger business model based on fundamental operating principles and fiscal responsibility.  While we believe the economic condition of our customers improved as the fiscal year progressed, we believe the effect of an economic recovery on the gaming business will be slow and steady. As a result, we continue to trim costs where possible, improve our marketing efforts and elevate the guest experience to improve the competitive positioning of each of our properties.  Over the past two years we have made prudent changes to our cost structure, including the elimination of over $30 million in property-level operating costs relating to our gaming floors, guest amenities and hotels, other facilities and marketing and administrative costs.

"The results of our properties during the quarter varied by market, but we are generally encouraged by the change in direction we have experienced compared to prior year. In Mississippi, Missouri and Iowa, we are finding market stability and a continued positive response to the new products we have introduced, including our two Lady Luck-branded casinos. In Pompano and Lake Charles, there are clear signs of improvement based upon new marketing programs and cost containment.  In Pompano, we believe, as a result of the gaming tax rollback set to take effect on July 1, we will be able to target customers we have not been able to effectively market to in the past due to the tax rate.  

"Additionally, we believe there will continue to be opportunities to expand our gaming management and development efforts.  In addition to the Rainbow Casino transaction, we are fully engaged in a competitive bid process for the final resort license in Pennsylvania, have indicated a preliminary interest in the 13th Missouri license and are continuing to evaluate opportunities in a variety of jurisdictions that, we believe, could positively impact our future free cash flows."

Dale R. Black, the Company's senior vice president and chief financial officer, commented, "We believe we are responsibly managing through the economic downturn and are encouraged by the fact that the country has experienced six straight months of increases in consumer spending, particularly in the retail and manufacturing sectors which, we believe, bodes well for our economic outlook over time.  

"With the added flexibility of the amendment to our credit facility through 2012 and the free cash flow expected to be generated through the Rainbow transaction, we believe that our business will begin to show more clear signs of economic improvement late in this calendar year and into 2011."

Corporate and Other

Corporate and other increased $4.3 million to $13.0 million during the fourth quarter of fiscal 2010 compared to prior year, primarily due to credit amendment costs of $1.8 million, development costs of $0.9 million and increased non-cash stock compensation expense of $1.7 million.

For the fiscal year ended April 25, 2010, corporate and other increased $4.5 million, primarily due to credit amendment costs of $1.8 million, development costs of $1.5 million and increased non-cash stock compensation expense of $1.1 million.

Interest expense for the quarter was $21.7 million, an increase of $2.2 million compared to the prior fiscal year, primarily due to the increase of interest rates on the credit facility as a result of the recent amendment.  For the fiscal year ended April 25, 2010, interest expense decreased $16.6 million, primarily as a result of lower debt levels during the year, offset by the increased costs associated with the recent amendment.

As a result of the amendment to the credit facility, we incurred a charge of approximately $2.1 million related to fees and the write-off of certain unamortized deferred financing costs, of which approximately $0.3 million was non-cash and included in interest expense.

Capital Structure and FY 2011 Guidance

As of April 25, 2010, the Company had:

  • $68.1 million in cash and cash equivalents
  • $1,200.9 million in total debt
  • Over $330 million in net line of credit availability

FY 2010 capital expenditures were $27.7 million

The Company provided guidance for the following specific non-operating items for fiscal year 2011 assuming the Rainbow acquisition closes by June 30, 2010:

  • Depreciation and amortization expense is expected to be approximately $85 million to $87 million;
  • The Company expects cash income taxes pertaining to FY 2011 operations to be less than $5 million which primarily represents state income taxes.
  • Interest expense is expected to be approximately $89 million to $92 million, net of capitalized interest.
  • Total Corporate expenses for FY 2011 are expected to be approximately $46 million including approximately $8.5 million in non-cash stock compensation expense.
  • Maintenance capital expenditures for FY 2011 are expected to be approximately $45 million to $48 million, including conversion of approximately 2,500 slot machines to the Bally's slot system technology.

Conference Call Information

Isle of Capri Casinos, Inc. will host a conference call on Wednesday, June 2, 2010 at 10:00 am Central Time during which management will discuss the financial and other matters addressed in this press release.  The conference call can be accessed by interested parties via webcast through the investor relations page of the Company's website, www.islecorp.com, or, for domestic callers, by dialing (877) 917-8929.  International callers can access the conference call by dialing (630) 395-0312.  The conference call access code is 9056848.

This conference call will be recorded and available for review starting at noon central on Wednesday, June 2, 2010 on the Company's website, www.islecorp.com.  The audio of the conference call will also be available by telephone from that time until midnight central on Wednesday, June 9, 2010, by dialing (866) 498-5468 for domestic callers or (203) 369-1798 for International callers.  The access code will be 875962.

ISLE OF CAPRI CASINOS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share amounts)

(Unaudited)

Three Months Ended

Twelve Months Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

Revenues:

Casino

$     270,429

$     285,764

$  1,013,386

$  1,055,694

Rooms

10,520

10,684

43,007

46,380

Pari-mutuel, food, beverage and other

36,173

37,484

134,994

138,632

Hurricane insurance recoveries

-

2,932

-

62,932

Gross revenues

317,122

336,864

1,191,387

1,303,638

Less promotional allowances

(48,326)

(52,255)

(191,551)

(195,603)

Net revenues

268,796

284,609

999,836

1,108,035

Operating expenses:

Casino

38,487

39,291

153,838

151,610

Gaming taxes

71,185

73,108

262,241

269,928

Rooms

2,727

3,003

10,845

12,306

Pari-mutuel, food, beverage and other

12,121

14,451

44,760

51,462

Marine and facilities

15,359

16,166

61,507

64,368

Marketing and administrative

62,516

65,437

253,097

256,210

Corporate and development

13,339

8,757

46,750

41,331

Expense recoveries and other charges

-

30,125

(6,762)

36,125

Hurricane insurance recoveries

-

(98)

-

(32,277)

Depreciation and amortization

25,443

30,101

109,504

122,440

Total operating expenses

241,177

280,341

935,780

973,503

Operating income

27,619

4,268

64,056

134,532

Interest expense

(21,752)

(19,543)

(75,434)

(92,065)

Interest income

615

491

1,833

2,112

Gain (loss) on early extinguishment of debt

-

57,693

-

57,693

Other expense

(370)

-

(370)

-

Income (loss) from continuing operations before

 income taxes

6,112

42,909

(9,915)

102,272

Income tax benefit (provision)

319

(17,356)

8,374

(41,039)

Income (loss) from continuing operations

6,431

25,553

(1,541)

61,233

Income (loss) from discontinued operations,

  including loss on sale, net of income taxes

(1,546)

(10,965)

(1,732)

(17,658)

Net income (loss)

$         4,885

$       14,588

$        (3,273)

$       43,575

Income (loss) per common share-basic and dilutive:

Income (loss) from continuing operations

$           0.20

$           0.80

$          (0.05)

$           1.95

Income (loss) from discontinued operations,

       including loss on sale, net of income taxes

(0.05)

(0.34)

(0.05)

(0.56)

Net income (loss)

$           0.15

$           0.46

$          (0.10)

$           1.39

Weighted average basic shares

32,445,378

31,770,653

32,245,769

31,372,670

Weighted average diluted shares

32,515,829

31,770,653

32,245,769

31,379,016

ISLE OF CAPRI CASINOS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

April 25,

April 26,

2010

2009

ASSETS

Current assets:

Cash and cash equivalents

$          68,069

$          96,654

Marketable securities

22,926

17,548

Accounts receivable, net

8,879

11,935

Income taxes receivable

8,109

7,744

Deferred income taxes

16,826

16,295

Prepaid expenses and other assets

25,095

23,234

Assets held for sale

-

4,183

Total current assets

149,904

177,593

Property and equipment, net

1,098,942

1,177,540

Other assets:

Goodwill

313,136

313,136

Other intangible assets, net

79,675

83,588

Deferred financing costs, net

10,354

9,314

Restricted cash

2,774

2,774

Prepaid deposits and other

20,055

18,717

Total assets

$     1,674,840

$     1,782,662

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Current maturities of long-term debt

$            8,754

$            9,688

Accounts payable

24,072

15,079

Accrued liabilities:

Payroll and related

45,863

47,402

Property and other taxes

20,253

31,563

Interest

14,779

9,280

Progressive jackpots and slot club awards

14,144

13,892

Other

29,290

39,201

Liabilities related to assets held for sale

-

1,888

Total current liabilities

157,155

167,993

Long-term debt, less current maturities

1,192,135

1,291,384

Deferred income taxes

29,193

24,970

Other accrued liabilities

38,972

52,575

Other long-term liabilities

17,166

17,314

Stockholders' equity:

Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued

-

-

Common stock, $.01 par value; 45,000,000 shares authorized; shares issued:

36,771,730 at April 25, 2010 and 36,111,089 at April 26, 2009

367

361

Class B common stock, $.01 par value; 3,000,000 shares authorized; none issued

-

-

Additional paid-in capital

201,464

193,827

Retained earnings

98,555

101,828

Accumulated other comprehensive (loss) income

(8,060)

(15,191)

292,326

280,825

Treasury stock, 4,326,242 shares at April 25, 2010 and 4,340,436

 shares at April 26, 2009

(52,107)

(52,399)

Total stockholders' equity

240,219

228,426

Total liabilities and stockholders' equity

$     1,674,840

$     1,782,662

Isle of Capri Casinos, Inc.

Supplemental Data - Net Revenues

(unaudited, in thousands)

Three Months Ended

Twelve Months Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

Mississippi

Biloxi

$      19,112

$      21,868

$      72,602

$         83,880

Natchez

9,320

10,043

32,826

37,023

Lula

19,323

20,328

68,147

70,985

Mississippi Total

47,755

52,239

173,575

191,888

Louisiana

Lake Charles

35,771

40,007

139,423

152,112

Missouri

Kansas City

21,014

21,372

76,815

74,435

Boonville

20,284

21,586

77,759

78,582

Caruthersville

8,959

9,151

32,685

31,579

Missouri Total

50,257

52,109

187,259

184,596

Iowa

Bettendorf

20,373

22,963

79,527

91,661

Davenport

12,745

13,544

48,075

49,005

Marquette

6,745

7,224

27,176

29,875

Waterloo

22,344

21,863

81,261

80,544

Iowa Total

62,207

65,594

236,039

251,085

Colorado

Black Hawk

30,419

30,715

126,140

123,382

Florida

Pompano

42,007

40,900

135,998

142,672

Property Net Revenues before Other

268,416

281,564

998,434

1,045,735

Insurance Recoveries(2)

Davenport

-

758

-

758

Natchez

-

2,174

-

1,087

Biloxi

-

-

-

60,000

Other

380

113

1,402

455

Net Revenues from Continuing Operations

$    268,796

$    284,609

$    999,836

$    1,108,035

Isle of Capri Casinos, Inc.

Supplemental Data - EBITDA (1)

(unaudited, in thousands)

Three Months Ended

Twelve Months Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

Mississippi

Biloxi

$        2,444

$        2,070

$          5,721

$         9,050

Natchez

3,676

3,873

10,685

13,820

Lula

6,555

6,504

18,810

20,294

Mississippi Total

12,675

12,447

35,216

43,164

Louisiana

Lake Charles

7,222

9,705

23,579

34,521

Missouri

Kansas City

5,777

5,596

17,637

15,108

Boonville

6,805

7,606

25,603

25,526

Caruthersville

2,094

2,205

6,462

6,356

Missouri Total

14,676

15,407

49,702

46,990

Iowa

Bettendorf

5,863

6,630

21,365

29,372

Davenport

4,144

3,986

13,630

14,591

Marquette

1,445

1,167

5,164

6,324

Waterloo

7,356

6,824

23,456

22,969

Iowa Total

18,808

18,607

63,615

73,256

Colorado

Black Hawk

6,910

7,773

29,740

33,421

Florida

Pompano

5,630

3,843

9,736

8,558

Property EBITDA Before

    Corporate and Other Items

65,921

67,782

211,588

239,910

Corporate and Other

(11,025)

(8,650)

(43,415)

(40,876)

EBITDA Before Other Items

54,896

59,132

168,173

199,034

Other Items:

Insurance Recoveries(2)

Biloxi

-

-

-

92,179

Davenport

-

758

-

758

Natchez

-

2,272

-

1,136

Valuation Charges(3)

Biloxi

-

(11,856)

-

(11,856)

Black Hawk

-

(18,269)

-

(18,269)

Expense Recoveries and Other(4)

-

-

6,762

(6,000)

Debt Refinancing Costs

(1,834)

-

(1,834)

-

Other:(5)

Marquette Hotel Demolition

-

-

(475)

-

Caruthersville Property Tax Settlement

-

-

934

-

Pompano Gaming Tax Refund

-

2,332

-

1,890

Colorado Referendum Costs

-

-

-

(1,900)

EBITDA from Continuing Operations

$      53,062

$      34,369

$      173,560

$     256,972

Isle of Capri Casinos, Inc.

Supplemental Data - Reconciliation of Operating Income to EBITDA(1)

(unaudited, in thousands)

Three Months Ended April 25, 2010

Three Months Ended April 26, 2009

Depreciation

Depreciation

Operating

and

Operating

and

Income

Amortization

EBITDA

Income

Amortization

EBITDA

Mississippi

Biloxi

$      (1,024)

$             3,468

$     2,444

$      (1,859)

$             3,929

$     2,070

Natchez

3,306

370

3,676

3,243

630

3,873

Lula

4,641

1,914

6,555

4,114

2,390

6,504

Mississippi Total

6,923

5,752

12,675

5,498

6,949

12,447

Louisiana

Lake Charles

4,769

2,453

7,222

6,748

2,957

9,705

Missouri

Kansas City

4,856

921

5,777

4,448

1,148

5,596

Boonville

5,739

1,066

6,805

6,457

1,149

7,606

Caruthersville

1,192

902

2,094

980

1,225

2,205

Missouri Total

11,787

2,889

14,676

11,885

3,522

15,407

Iowa

Bettendorf

3,830

2,033

5,863

4,141

2,489

6,630

Davenport

3,507

637

4,144

2,968

1,018

3,986

Marquette

947

498

1,445

543

624

1,167

Waterloo

4,377

2,979

7,356

3,872

2,952

6,824

Iowa Total

12,661

6,147

18,808

11,524

7,083

18,607

Colorado

Black Hawk

3,346

3,564

6,910

3,797

3,976

7,773

Florida

Pompano

1,933

3,697

5,630

(434)

4,277

3,843

Total Property Before

   Corporate and Other Items

41,419

24,502

65,921

39,018

28,764

67,782

Corporate and Other

(11,966)

941

(11,025)

(9,987)

1,337

(8,650)

Total Before Other Items

29,453

25,443

54,896

29,031

30,101

59,132

Other Items:

Insurance Recoveries(2)

Davenport

-

-

-

758

-

758

Natchez

-

-

-

2,272

-

2,272

Valuation Charges(3)

Biloxi

-

-

-

(11,856)

-

(11,856)

Black Hawk

-

-

-

(18,269)

-

(18,269)

Debt Refinancing Costs

(1,834)

-

(1,834)

-

-

-

Pompano Gaming Tax Refund(5)

-

-

-

2,332

-

2,332

Total From Continuing Operations

$     27,619

$           25,443

$   53,062

$       4,268

$           30,101

$   34,369

Isle of Capri Casinos, Inc.

Supplemental Data - Reconciliation of Operating Income to EBITDA(1)

(unaudited, in thousands)

Twelve Months Ended April 25, 2010

Twelve Months Ended April 26, 2009

Depreciation

Depreciation

Operating

and

Operating

and

Income

Amortization

EBITDA

Income

Amortization

EBITDA

Mississippi

Biloxi

$    (8,306)

$         14,027

$        5,721

$      (7,952)

$           17,002

$        9,050

Natchez

8,868

1,817

10,685

10,811

3,009

13,820

Lula

10,692

8,118

18,810

11,498

8,796

20,294

Mississippi Total

11,254

23,962

35,216

14,357

28,807

43,164

Louisiana

Lake Charles

13,317

10,262

23,579

22,041

12,480

34,521

Missouri

Kansas City

13,717

3,920

17,637

10,369

4,739

15,108

Boonville

21,125

4,478

25,603

20,737

4,789

25,526

Caruthersville

2,919

3,543

6,462

1,638

4,718

6,356

Missouri Total

37,761

11,941

49,702

32,744

14,246

46,990

Iowa

Bettendorf

12,624

8,741

21,365

20,090

9,282

29,372

Davenport

10,494

3,136

13,630

10,351

4,240

14,591

Marquette

2,763

2,401

5,164

3,705

2,619

6,324

Waterloo

11,614

11,842

23,456

11,377

11,592

22,969

Iowa Total

37,495

26,120

63,615

45,523

27,733

73,256

Colorado

Black Hawk

14,891

14,849

29,740

16,588

16,833

33,421

Florida

Pompano

(6,951)

16,687

9,736

(8,324)

16,882

8,558

Property EBITDA Before

  Corporate and Other Items

107,767

103,821

211,588

122,929

116,981

239,910

Corporate and Other

(48,140)

4,725

(43,415)

(46,335)

5,459

(40,876)

EBITDA Before Other Items

59,627

108,546

168,173

76,594

122,440

199,034

Other Items:

Insurance Recoveries(2)

Biloxi

-

-

-

92,179

-

92,179

Davenport

-

-

-

758

-

758

Natchez

-

-

-

1,136

-

1,136

Valuation Charges(3)

Biloxi

-

-

-

(11,856)

-

(11,856)

Black Hawk

-

-

-

(18,269)

-

(18,269)

Expense Recoveries and Other(4)

6,762

-

6,762

(6,000)

-

(6,000)

Debt Refinancing Costs

(1,834)

-

(1,834)

-

-

-

Other:(5)

Marquette Hotel Demolition

(1,433)

958

(475)

-

-

-

Caruthersville Property Tax Settlement

934

-

934

-

-

-

Pompano Gaming Tax Refund

-

-

-

1,890

-

1,890

Colorado Referendum Costs

-

-

-

(1,900)

-

(1,900)

EBITDA From Continuing Operations

$    64,056

$       109,504

$    173,560

$   134,532

$         122,440

$    256,972

1.

EBITDA is "earnings before interest and other non-operating income (expense), income taxes, and depreciation and amortization." "Property EBITDA" is EBITDA before Corporate and development expenses and minority interest.  EBITDA is presented solely as a supplemental disclosure because management believes that it is 1) a widely used measure of operating performance in the gaming industry, 2) used as a component of calculating required leverage and minimum interest coverage ratios under our Senior Credit Facility and 3) a principal basis of valuing gaming companies. Management uses EBITDA and Property EBITDA as the primary measure of the Company's operating properties' performance, and they are important components in evaluating the performance of management and other operating personnel in the determination of certain components of employee compensation.  EBITDA should not be construed as an alternative to operating income as an indicator of the Company's operating performance, as an alternative to cash flows from operating activities as a measure of liquidity or as an alternative to any other measure determined in accordance with U.S. generally accepted accounting principles (GAAP).  The Company has significant uses of cash flows, including capital expenditures, interest payments, taxes and debt principal repayments, which are not reflected in EBITDA.  Also, other gaming companies that report EBITDA information may calculate EBITDA in a different manner than the Company.  A reconciliation of EBITDA and Property EBITDA to operating income is included in the financial schedules accompanying this release. A reconciliation of EBITDA to the Company's net income (loss) is shown below (in thousands).

Three Months Ended

Fiscal Year Ended

April 25,

April 26,

April 25,

April 26,

2010

2009

2010

2009

EBITDA

$ 53,062

$ 34,369

$ 173,560

$ 256,972

Add/(deduct):

Depreciation and amortization

(25,443)

(30,101)

(109,504)

(122,440)

Interest expense:

 Interest expense, net

(21,137)

(19,052)

(73,601)

(89,953)

 Gain on early extinguishment of debt

-

57,693

-

57,693

 Other expense

(370)

-

(370)

-

Income tax benefit (provision)

319

(17,356)

8,374

(41,039)

Income (loss) from discontinued operations,

 including loss on sale, net of income taxes

(1,546)

(10,965)

(1,732)

(17,658)

Net income (loss)

$   4,885

$ 14,588

$   (3,273)

$   43,575

Certain of our debt agreements use "Adjusted EBITDA" as a financial measure for the calculation of financial debt covenants. Adjusted EBITDA differs from EBITDA as Adjusted EBITDA includes add back of items such as gain on early extinguishment of debt, pre-opening expenses, certain write-offs and valuation expenses, and non-cash stock compensation expense. Reference can be made to the definition of Adjusted EBITDA in the applicable debt agreements on file as Exhibits to our filings with the Securities and Exchange Commission.  

2.

We have received insurance recoveries related to various claims.  The insurance recoveries for our Biloxi property in fiscal year 2009 related to Hurricane Katrina claims.  In addition, we received insurance recoveries at our Davenport and Natchez properties related to flood and other claims.  

3.

We recorded a valuation charge as a result of our impairment testing under ASC 350 at our Black Hawk properties in fiscal year 2009.  We recorded a valuation charge reducing our construction in progress following a decision to change construction plans at our Biloxi property in fiscal year 2009.

4.

Expense recoveries and other of $(6.8) million for fiscal year 2010 reflect income from the recording of a receivable for reimbursement of Pittsburgh development costs. Expense recoveries and other of $6.0 million for fiscal year 2009 reflect a charge representing the cancellation of our rights to acquire land including a $1.0 million termination fee, related to the potential development of a casino project in the Portland, Oregon area.

5.

Other:  During fiscal year 2010, the Company demolished the hotel at our Marquette property. As a result, operating income for the fiscal year 2010 includes $0.5 million in demolition costs and $1.0 million in acceleration of remaining depreciation.  Caruthersville includes the favorable impact of $0.9 million from the settlement of a property tax appeal during fiscal year 2010. In fiscal year 2009, Pompano includes the results of an agreement reached with the State of Florida regarding an interpretation of the gaming tax calculation based on taxes paid since opening.  The Colorado properties include costs associated with the gaming referendum passed during fiscal year 2009.

About Isle of Capri Casinos, Inc.

Isle of Capri Casinos, Inc., founded in 1992, is dedicated to providing its customers with an exceptional gaming and entertainment experience at each of its 14 casino properties. The Company owns and operates casinos domestically in Biloxi, Lula and Natchez, Mississippi; Lake Charles, Louisiana; Bettendorf, Davenport, Marquette and Waterloo, Iowa; Boonville, Caruthersville and Kansas City, Missouri, two casinos in Black Hawk, Colorado, and a casino and harness track in Pompano Beach, Florida. More information is available at the Company's website, www.islecorp.com.

Forward-Looking Statements

This press release may be deemed to contain forward-looking statements, which are subject to change. These forward-looking statements may be significantly impacted, either positively or negatively by various factors, including without limitation, licensing, and other regulatory approvals, financing sources, development and construction activities, costs and delays, weather, permits, competition and business conditions in the gaming industry. The forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements herein.

Additional information concerning potential factors that could affect the Company's financial condition, results of operations and expansion projects, is included in the filings of the Company with the Securities and Exchange Commission, including, but not limited to, its Form 10-K for the most recently ended fiscal year.

CONTACTS:

Isle of Capri Casinos, Inc.,

Dale Black, Chief Financial Officer-314.813.9327

Jill Haynes, Senior Director of Corporate Communication-314.813.9368

SOURCE Isle of Capri Casinos, Inc.



RELATED LINKS

http://www.islecorp.com