Colonial Downs Corrects and Replaces Previous Third Quarter Profit Announcement.NEW KENT, Va.--(BUSINESS WIRE)--Nov. 14, 1997--Colonial Downs Holdings Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on NMS See NetWare Management System. :CDWN) which holds the only unlimited licenses to own and operate a pari-mutuel horse racing horse racing, trials of speed involving two or more horses. It includes races among harnessed horses with one of two particular gaits, among saddled Thoroughbreds (or, less frequently, quarterhorses) on a flat track, or among saddled horses over a turf course with course and satellite wagering wa·ger n. 1. a. An agreement under which each bettor pledges a certain amount to the other depending on the outcome of an unsettled matter. b. A matter bet on; a gamble. 2. facilities in Virginia, Friday reported results of operations for the third quarter of 1997. Net earnings for the third quarter ended Sept. 30, 1997 were $80,000, or $0.01 per share, compared with a net loss of $213,000, or $0.07 per share for the third quarter of 1996. Revenues for the third quarter were $7,153,000 compared with $2,062,000 in the third quarter of 1996. Net earnings for the nine months ended Sept. 30, 1997 improved by $1,390,000 to $982,000, or $0.16 per share, compared with a loss of $408,000, or a loss of $0.14 per share in 1996. Revenues for the first nine months of 1997 were $17,614,000, up from $5,704,000 in 1996. Per share calculations are based upon the weighted average of common shares outstanding as of the end of each quarter. Prior to its initial public offering, the Company had an equivalent of 3,000,000 shares. At the end of the third quarter of 1997, the Company had 7,250,000 common shares outstanding as a result of its initial public offering of 4,250,000 shares effective March 17, 1997. The increase in revenue and earnings during these periods as compared with the same periods a year ago results from the operation of two racing centers for the entire first nine months of 1997 and one month of operation of live thoroughbred horse Thoroughbred horse, breed of light horse more properly known as the English running horse. As its name implies, it was the first pedigreed, or "thoroughbred" horse. racing at the Colonial Downs Colonial Downs is a horse racing track in New Kent, Virginia adjacent to Interstate 64, halfway between Richmond, Virginia and Williamsburg, Virginia. History and information The track opened on September 1, 1997. More than 13,000 attended the track on opening day. Race Track compared to only operating the Chesapeake Racing Center, which opened on Feb. 17, 1996, during the corresponding period in 1996. Commenting on the results, Chairman and Chief Executive Officer Jeff Jacobs said: "We had several positive occurrences in the third quarter. First of all, we successfully operated our first live thoroughbred Thoroughbred Light breed of racing and jumping horse descended from three desert stallions brought to England between 1689 and 1724. Thoroughbreds have a delicate head, slim body, broad chest, and short back. Most are bay, chestnut, brown, black, or gray. meet; secondly, we made a profit after substantial initial startup and operating race meet expenses; and lastly, our attendance and fan base grew steadily throughout the meet. Our fans are becoming more sophisticated in regards to this new sport. "The last week of the meet our daily attendance averaged 4,300 with a per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals. handle of approximately $70. We look forward to a productive fourth quarter as we open two more satellite wagering centers and begin to prepare for our first live harness meet in April 1998." In 1998, the harness season will begin on April 24 and run through the July 4th weekend. Other significant matters affecting the Company are: -- Colonial Downs, in conjunction with The Virginia Tourism Council, will host the prestigious harness racing harness racing: see horse racing. harness racing Horse-racing sport. In harness racing, Standardbred horses are harnessed to lightweight, two-wheeled, bodiless (seat-only) vehicles known as sulkies. The sport's origins date to ancient chariot races. event, The Breeders Crown The Breeders Crown is an annual series of Harness races covering each of the sport's twelve traditional categories of age, gait and gender. The series was initiated by the Hambletonian Society, promoters of the Hambletonian Stakes, in 1984 to enhance the Standardbred breeding , in November 1998. This series of races is the standardbred horse Standardbred horse or trotter, American breed of light horse developed especially for harness, or sulky, racing. Of Thoroughbred ancestry, it is similar in appearance to a thoroughbred but has shorter legs. industry's equivalent to thoroughbred racing's Breeders' Cup The Breeders' Cup World Championships is an annual series of Grade I thoroughbred horse races operated by Breeders' Cup Limited, a company formed in 1982 by a consortium of North American racing organizations, led by the National Thoroughbred Racing Association. . President Jim Peterson
James Scott "Jim" Peterson, PC, BA, LL.B LL.M DCL (born July 30, 1941) is a retired Canadian politician and former Minister of International Trade. said: "This is quite significant given that we have not run a single harness race or hosted a harness meet at this facility. This is a great vote of confidence for our organization and our race track." -- Construction of the Hampton and Brunswick satellite facilities is well underway and scheduled for completion in the 4th quarter of 1997. The Hampton facility will open first and is in the inspection and acceptance phase with local officials. The Brunswick opening will follow and will be in operation in December. -- Colonial Downs plans to file on Nov. 14, 1997 a demand for arbitration arbitration Process of resolving a dispute or a grievance outside a court system by presenting it for decision to an impartial third party. Both sides in the dispute usually must agree in advance to the choice of arbitrator and certify that they will abide by the with Norglass Inc., the general contractor A general contractor is an organization or individual that contracts with another organization or individual (the owner) for the construction of a building, road or any other execution of work or facility. that managed the construction of the track and grandstand, in response to mechanic's liens A charge or claim upon the property of another individual as security for a debt that is created in order to obtain priority of payment of the price or value of work that is performed and materials that are provided in the erection or repair of a building or other structure. filed by Norglass Inc. The contract between Colonial Downs and Norglass is a fixed price contract for $29.5 million, and Norglass' claim exceeds the amount remaining to be paid under the contract. Colonial Downs disputes the amounts claimed under the liens. The contract with Norglass provides for disputes to be resolved by arbitration by the American Arbitration Association The American Arbitration Association (AAA) is a private enterprise in the business of arbitration, and one of several arbitration organizations that administers arbitration proceedings. The AAA also administers mediation and other forms of alternative dispute resolution. (AAA AAA: see American Automobile Association. (Triple A) A common single-cell battery used in a myriad of electronic devices of all variety. Like its double A (AA) cousin, it provides 1.5 volts of DC power. When used in series, the voltage is multiplied. ). Efforts to expand the satellite wagering network suffered a setback setback In architecture, a steplike recession in the profile of a high-rise building. Usually dictated by building codes to allow sunlight to reach streets and lower floors, the building must take another step back from the street for every specified added height interval. as a result of the November referendums in Roanoke, Fredericksburg, and Martinsville. Voters in these cities rejected the Company's request to build facilities in these localities. President Jim Peterson said: "This is a setback in locating our remaining facilities. We will evaluate our efforts in these localities, regroup re·group v. re·grouped, re·group·ing, re·groups v.tr. To arrange in a new grouping. v.intr. 1. To come back together in a tactical formation, as after a dispersal in a retreat. , and explore the options in 1998. We have a great company and several cities and counties throughout the state have contacted us and expressed strong interest in having a satellite wagering center in their locality 1. locality - In sequential architectures programs tend to access data that has been accessed recently (temporal locality) or that is at an address near recently referenced data (spatial locality). This is the basis for the speed-up obtained with a cache memory. 2. ." -0- Statements regarding additional satellite wagering facilities' opening dates, referendums and certain other statements contained in this news release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results of the company to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such potential risks, uncertainties and factors include but are not limited to the risk of construction delays including unforeseen environmental, engineering or geological ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. problems, permitting, governmental regulations, including licensing of additional satellite wagering centers and, approvals by the Virginia Racing Commission, competition from other sporting events and forms of entertainment, and the success of planned marketing and promotional efforts. Investors are also directed to consider other risks and uncertainties discussed in documents filed by the company with the Securities and Exchange Commission. Colonial Downs Holdings, Inc. is a Virginia corporation organized in November 1996 to pursue opportunities for horse racing wagering in Virginia. The company holds the only unlimited licenses to own and operate a pari-mutuel horse racing course and satellite wagering facilities/racing centers in Virginia. Colonial Downs Holdings, Inc. became a publicly-held company in March 1997 and trades on the NASDAQ National Market System under the symbol CDWN. -0-
COLONIAL DOWNS HOLDINGS INC.
Dollars in Thousands, Except Per Share Data
Consolidated Statements of Earnings
Quarter Ended
Sept. 30,
1997 1996
Revenues $ 7,153 $ 2,062
Expenses
Operating 6,643 1,758
General and administrative 625 456
Total expenses 7,268 2,214
Earning (loss) from operations (115) (152)
Other income (expense):
Interest expense (32) (63)
Interest income 268 2
Total other income (expense) 236 (61)
Earnings (loss) before income taxes 121 (213)
Taxes on income (41) -
Net earnings (loss) $ 80 $ (213)
Earnings (loss) per common share $0.01 $(0.07)
Weighted average number of
shares outstanding 7,250 3,000
-0-
Nine Months Ended
Sept. 30,
1997 1996
Revenues $17,614 $5,704
Expenses
Operating 15,506 4,801
General and administrative 1,350 1,223
Total expenses 16,856 6,024
Earning (loss) from operations 758 (320)
Other income (expense):
Interest expense (116) (94)
Interest income 707 6
Total other income (expense) 591 (88)
Earnings (loss) before income taxes 1,349 (408)
Taxes on income (367) -
Net earnings (loss) $ 982 $ (408)
Earnings (loss) per common share $0.16 $(0.14)
Weighted average number of
shares outstanding 6,051 3,000
-0-
Colonial Downs Holdings, Inc.
Consolidated Balance Sheets
Sept. 30, December 31,
1997 1996
Assets:
Current:
Cash and cash equivalents $ 9,036 $ 1,380
Other Assets 6,501 386
Total Current Assets 15,537 1,766
Property and equipment, net 57,741 9,238
Other assets, net 876 1,172
Total Assets $ 74,154 $ 12,176
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $13,372 $ 3,566
Notes Payable - stockholders -- 1,638
Accrued liabilities 1,221 480
Current maturities of long-term
debt 1,407 48
Purses due horsemen 5,205 1,957
Income taxes payable 367 -
Total Current Liabilities 21,572 7,689
Long term liabilities
Long-term debt 4,244 42
Refundable advance - land 5,000 -
Notes payable - stockholders 5,500 3,449
----- -----
Total Long-term Liabilities 14,744 3,491
Total Liabilities 36,316 11,180
Stockholders Equity 37,838 996
Total Liabilities and
Stockholders' Equity $ 74,154 $ 12,176
CONTACT: Colonial Downs Holdings Inc. Herb Jones, 804/966-7223 |
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