Elsinore announces first-quarter earnings.

LAS VEGAS--(BUSINESS WIRE)--May 22, 1997--Elsinore Corp. (NASDAQ Bulletin Board:ELSO) reported net revenues of $14.9 million for the first quarter ending March 31, 1997, compared with $15.9 million for the first quarter of 1996.

The $940,000, or 5.9 percent decrease, was primarily due to the elimination of unprofitable marketing programs which had generated significant table games revenue with no profit margins in the first quarter of 1996. Despite the decrease in casino revenues, profits and profit margins in the table games department increased in the first quarter.

EBITDA (earnings before interest, taxes, depreciation and amortization) increased 5.4 percent from $2.1 million in the first quarter of 1996 to $2.2 million in the first quarter of 1997. The company attributes this improvement to the redirection of its marketing efforts from table games to slots.

While certain of its key competitors in downtown Las Vegas reported lower operating profits in the first quarter of 1997, the Four Queens has shown positive results under Riviera Gaming Management's direction.

As a result of the Chapter 11 Reorganization which became effective Feb. 28, 1997, Fresh Start Reporting was adopted by the company. Accordingly, Elsinore recognized an extraordinary gain of $36.0 million on the elimination of debt in the reorganization. Net income before the extraordinary gain increased from $344,000 in the first quarter of 1996 to $361,000 for the same period in 1997.

The reorganization also resulted in a class of pre-reorganization bondholders receiving new debt and approximately 96.3 percent of the new shares issued. The "old equity" common shareholders are required to turn in their 15.9 million shares and receive a maximum of 72,706 new shares, or 1.5 percent, of the new equity in return for their old shares.

The net effect is comparable to a 219-to-1 reverse stock split. If an "old equity" common shareholder had 1,000 shares before the reorganization, the shareholder would receive four new shares with no payment for fractions. An additional 4,720 shares of new equity were purchased by "old equity" common shareholders in a rights offering conducted as part of the Chapter 11 proceedings. Accordingly, those shareholders now own an aggregate of 77,426 shares of new equity.

Due to the above transactions and accounting, earnings per share are not comparable and therefore are not presented in a combined format for the first quarter of 1997.

On April 11, 1997, the Morgens, Waterfall, Vintiadis & Co. Inc. -related entities which own 4,646,440 shares of new common stock (94.3 percent on an undiluted basis) reported in a Schedule 13D filed with the SEC that they were willing to grant an option to Allen Paulson to acquire their equity at $3.10 per share, subject to adjustment.

More recently, Paulson has expressed an interest to commence discussions with the company to acquire all of the company's outstanding shares at the same price. Any such acquisition is subject to prior approval by the Nevada Gaming Commission and other authorities and various other conditions. There can be no assurance at this time that any such transaction will occur. -0-

                 ELSINORE CORP. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
        (Dollars in thousands, except per-share amounts)
                         (unaudited)

                                              Combined
                                             Reorganized
                                                 and
                   Reorganized  Predecessor  Predecessor   Predecessor
                   Company One  Company Two  Company Three Company Three
                   Month Ended  Months Ended Months Ended  Months Ended
                    3/31, 1997  2/28, 1997    3/31, 1997    3/31, 1996

Net revenues:
  Casino              $  3,549    $  6,922       $10,471   $ 11,174
  Hotel                    864       1,736         2,600      2,996
  Food and beverage        895       1,745         2,640      3,501
  Other                    162         153           315        171
     Gross revenue       5,470      10,556        16,026     17,842
   Less promotional
    allowances            (320)       (760)       (1,080)    (1,956)
     Revenues, net       5,150       9,796        14,946     15,886

Operating costs and expenses:
   Casino                1,164       2,710         3,874      4,862
   Hotel                   694       1,410         2,104      1,878
   Food and beverage       547       1,105         1,652      1,756
   Taxes and licenses      507         980         1,487      1,811
   Selling, general and
    administrative         789       1,808         2,597      2,450
   Rents                   335         673         1,008      1,017
     Total operating costs
      and expenses       4,036       8,686        12,722     13,774

Earnings before interest,
 taxes, depreciation and
 amortization (EBIDTA)   1,114       1,110         2,224      2,112

Depreciation and
 amortization              169         529           698        970
Interest                   393         772         1,165        264
Income (loss) before
 reorganization items
 and extraordinary gain    552        (191)          361        878
Reorganization items         -           -                     (534)
Extraordinary gain on
 elimination of debt         -      35,977                        -
Net income                 552      35,786                      344
Retained earnings (deficit)
 beginning                   -    (110,327)                       -
Fresh start adjustments      -      74,541                        -
Retained earnings (deficit)
 ending                   $552          $0                     $344
Earnings per share:
Income (loss) before
 reorganization items
 and extraordinary gain  $0.11      $(0.01)                   $0.06
Extraordinary gain on
 elimination of debt         -      $ 2.26                        -

Net income               $0.11       $2.25                    $0.02
Weighted average
 shares outstanding  4,929,313    15,891,793             15,891,783
-0-
                     CONSOLIDATED BALANCE SHEET DATA

                             March 31, 1997      March 31, 1996

Cash and cash equivalents       $    11,542            $  7,208
Other current assets                  2,326               2,346
Total assets                         51,733              42,627
Long-term debt                       37,367              73,909
Shareholders' equity (deficit)        5,552             (40,710)

CONTACT: Elsinore Corp., Las Vegas

Cynthia A. Fremont, 702/387-5115

or

The Financial Relations Board, Los Angeles

Daniel Saks, 310/442-0599