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US – Isle of Capri down slightly in first quarter

By - 31 August 2016

Isle of Capri Casinos’ first quarter ended July 24, saw a slight drop in revenue, which reached $240.9m compared to $246.9m in the prior year quarter, down 2.5 per cent.

Seven of 13 properties generated higher year-over-year Adjusted EBITDA in the first quarter, five of which generated record first quarter Adjusted EBITDA.

Eric Hausler, the Company’s chief executive officer, said: “We experienced softer year-over-year trends in May and June; however we saw a solid rebound in July. Despite the early quarter softness, we generated record first quarter Adjusted EBITDA at Pompano, Waterloo, Cape Girardeau, Caruthersville andVicksburg, which was offset by lower results in Black Hawk and Lake Charles.
“We remain focused on driving increased profitability from our existing operations and effectively managing our corporate costs. Excluding Lake Charles, Adjusted EBITDA increased $0.2 m and Adjusted EBITDA margin increased 40 bps,” he added. “We continue to reinvigorate our properties through prudent capital investments to enhance the guest experience. During the quarter, we began renovating the Kansas City buffet and expect to start renovating the Black Hawk buffet in the second quarter, among other projects.

On June 24, Isle of Capri opened a new land-based facility in Bettendorf. “It has been well received,” Mr. Hausler explained.
“The property opened on time at a cost slightly under our previously announced $60m budget. Bettendorf’s Adjusted EBITDA increased 10.5 per cent during the first quarter year over year, despite the property being closed for almost a week in June for the transition. We continued to execute on a variety of other strategic initiatives which we believe enhance shareholder value. Most notably, on August 22 we announced that we have signed a definitive agreement to sell our Lake Charles property for $134.5m. On a pro forma basis, we expect the transaction will be accretive to Adjusted EBITDA margins and deleveraging. Beginning with the fiscal 2017 second fiscal quarter, we will reflect Lake Charles in discontinued operations in the consolidated income statements and as assets held for sale in the consolidated balance sheets.

Mr. Hausler concluded: “In late August, we launched LadyLuck.com—the essence of luck, fun and gaming—our social casino and merchandise site. Both offer our customers new and exciting channels to engage with our brand. We expect to further modify and enhance these experiences in the coming quarters.”

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