Argosy Gaming Co.'s Outlook Revised to Negative By S&P.NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 11/5/97--Standard & Poor's today revised its rating outlook on Argosy Gaming Co. to negative from stable, following third quarter operating results which showed greater than expected declines at its Alton, Ill., Baton Rouge Baton Rouge (băt`ən r  zh) [Fr.,=red stick], city (1990 pop. 219,531), state capital and seat of East Baton Rouge parish, SE La. , La., and Riverside, Mo. properties. Additionally, Standard & Poor's affirmed its single-'B'-plus corporate credit and first mortgage bonds ratings and single-'B'-minus convertible subordinated notes rating on Argosy. Argosy currently operates riverboats in Alton, Ill., Riverside, Mo., Baton Rouge, La., and Sioux City, Iowa <noinclude></noinclude> Sioux City (IPA: [su: 'sɪti]) is a city located in northwest Iowa in the United States. As of the 2000 census, the city had a total population of 85,013. and a temporary facility in Lawrenceburg, Ind. The temporary casino has performed well since opening in late 1996, generating over $24.5 million in earnings before interest, taxes, depreciation, and amortization Earnings before interest, taxes, depreciation, and amortization (EBITDA) A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) during the first nine months of 1997. This despite the casino's small size, lack of amenities, and inconvenient parking situation. Standard & Poor's continues to believe that the much larger permanent casino will be a strong cash flow contributor in 1998, given the limited competition in the Cincinnati, Ohio “Cincinnati” redirects here. For other uses, see Cincinnati (disambiguation). Cincinnati is a city in the U.S. state of Ohio and the county seat of Hamilton County. area. Standard & Poor's ratings assumed strong performance at the temporary Lawrenceburg site, as well as stabilization of performance at the company's other properties. However, deterioration in cash flow in the Baton Rouge, Alton, and Riverside facilities has been greater than expected, making the level of cash flow needed from Lawrenceburg that much greater. During the third quarter, Baton Rouge was cash flow negative, while Alton and Riverside were down 58% and 32% from the second quarter. While no new capacity is expected in any of these markets, competition is intense, and Argosy's market share continues to decline. Management changes at the various properties could help improve operating results going forward. Liquidity remains adequate with cash balances of about $40 million at Sept. 30, 1997. OUTLOOK: NEGATIVE Standard & Poor's still expects the permanent Lawrenceburg project to be very successful, generating cash flow levels among the highest of any riverboat riv·er·boat n. A boat suitable for use on a river. in the country. Still, EBITDA coverage of interest expense will have to be at least 1.5 times (x) in 1998 to maintain the current ratings, which will require either superior performance at Lawrenceburg or improvement at existing properties. -- CreditWire CONTACT: Greg Zappin, CFA (Computer Fraud and Abuse Act of 1986) Signed into law in 1986, the CFA was a significant step forward in criminalizing unauthorized access to computer systems and networks. The Act applies to "federal interest computers" that include any system used by the U.S. , New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (1) 212-208-8615 For more information on criteria or subscriptions: http://www.ratings.standardpoor.com |
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