Lakes Entertainment, Inc. Announces Results for Year 2002.Business Editors MINNEAPOLIS--(BUSINESS WIRE)--Feb. 11, 2003 Lakes Entertainment, Inc. (Nasdaq:LACO) today announced results for the fiscal year ended December 29, 2002. Revenue for the year totaled $1.5 million. The net loss for the year was $11.5 million and basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. losses were $1.08 per share. This compares with a net loss of $2.9 million, and basic and diluted losses of $.27 per share in 2001. The loss for 2002 includes an impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge of $4.0 million after-tax taken on a note receivable note receivable A debt due from borrowers and evidenced by a written promise of payment. Note receivable, an entry on the asset side of many corporate balance sheets, indicates the dollar amount of loans due to be repaid by borrowers. from Living Benefits Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. . This impairment was the result of increased competition in the viatical vi·at·i·cal adj. 1. or vi·at·ic Of or relating to traveling, a road, or a way. 2. Of or relating to a contractual arrangement in which a business buys life insurance policies from terminally ill patients for a percentage business and restrictions on ability to make further policy acquisitions. The current year loss also includes an impairment charge of $1.8 million after-tax relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc revised terms for the transfer of title and rights to the Polo Plaza Shopping Center shopping center, a concentration of retail, service, and entertainment enterprises designed to serve the surrounding region. The modern shopping center differs from its antecedents—bazaars and marketplaces—in that the shops are usually amalgamated into property and adjacent Travelodge property in Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. , Nevada, respectively. During 2002, the Shark Club parcel in Las Vegas, Nevada was also adjusted to its estimated market value of $15.0 million, resulting in an impairment charge of approximately $0.6 million after-tax. By comparison, net loss in the previous year also reflected the negative effects of several one-time charges, including a $17.2 million after-tax charge related to the Polo Plaza Shopping Center, Travelodge, Shark Club and Cable properties in Las Vegas, Nevada. Revenue for the year decreased by $33.4 million from 2001, principally because 2001 revenues included management fees for the management of Grand Casino casino or cassino (both: kəsē`nō). 1 Card game played with a full deck by two to four players. Its origins are obscure though it probably traces back to the Italian game of Scopa. Coushatta for the entire year. Since this management contract expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. on January 16, 2002, current year revenues include management fees for only 17 days. Due to the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of this management agreement with the Coushatta Tribe tribe [Lat., tribus: the tripartite division of Romans into Latins, Sabines, and Etruscans], a social group bound by common ancestry and ties of consanguinity and affinity; a common language and territory; and characterized by a political and economic of Louisiana CODE, OF LOUISIANA. In 1822, Peter Derbigny, Edward Livingston, and Moreau Lislet, were selected by the legislature to revise and amend the civil code, and to add to it such laws still in force as were not included therein. , the company's revenues and earnings have not included contributions from the Coushatta operation since January 16, 2002. The Company currently has no other management contracts from which it will derive revenues in 2003. Lakes' balance sheet at December 29, 2002 included approximately $176 million in assets and $15 million in liabilities for a book value of approximately $15.09 per share. Lakes' assets included $14 million in unrestricted cash, $8 million in restricted cash, notes receivable from loans related to new Indian casino projects of $71 million, Las Vegas land held under contract for sale of approximately $29 million, land held for development consisting of the Shark Club parcel of $15 million and land purchases at the various casino development sites of approximately $13 million, deferred tax assets of approximately $11 million and various other items of approximately $15 million. Lyle Berman Lyle Berman (born August 6, 1941 in Minneapolis, Minnesota) is a professional poker player and business executive. Business Berman grew up in Minnesota and attended the University of Minnesota where he graduated in 1964 with a degree in business administration. , Chairman, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and President of Lakes, stated, "2002 was a year of progress in several areas. A new joint venture was formed during 2002 called the World Poker Tour For the PBS network with the same abbreviation, see . The World Poker Tour (Abbreviated WPT) is a series of international poker tournaments featuring most of the world's professional players. . The World Poker Tour has started filming poker tournaments A poker tournament is a tournament in which the winners are decided by playing poker, usually a particular style of poker. Contrast this to a ring game, where the game is ongoing with no formal structure to determine a single winner in a certain length of time. throughout the world for viewing on television. The Travel Channel recently announced that they would soon begin broadcasting the World Poker Tour events. In conjunction with this new business opportunity, the company was renamed Lakes Entertainment, Inc. to better describe our business model. Regarding the land we sold in Las Vegas at the end of last year, we have resolved all of the post-closing conditions to the sale and now expect to receive a substantial amount of the payment by the end of March of this year. In addition, Lakes entered into a joint-venture for the purpose of developing the Shark Club parcel in Las Vegas, Nevada as an upscale time-share project and continue to review other potential opportunities for this land. During 2002, the dismissal of the Stratosphere stratosphere (străt`əsfēr), second lowest layer of the earth's atmosphere. The level from which it extends outward varies with latitude; it begins c.5 1-2 mi (9 km) above the poles, c.6 or 7 mi (c. litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. previously referred to as the "Standby standby Medtalk adjective Referring to the immediate availability of a certain specialist–anesthesiologist, surgeon, who can be deployed in a medical emergency. Cf Concurrent. Equity Commitment Litigation", was affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. by the Appeals Court. Since Lakes would have been required to indemnify To compensate for loss or damage; to provide security for financial reimbursement to an individual in case of a specified loss incurred by the person. Insurance companies indemnify their policyholders against damage caused by such things as fire, theft, and flooding, which Grand for the amount of any judgment, we are pleased that this major uncertainly which has previously surrounded sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. our company has now been definitively removed. In addition, during January 2002, we completed the purchase of our corporate office building eliminating the risk of a long-term lease commitment." Mr. Berman also stated, "We have development and management contracts for what we feel are the best potential new Native American Casino American Casino is a current American reality television series. The show originally aired on the Discovery Channel, but in June 2005, it was moved to The Travel Channel. sites in the country. Although the regulatory and development approvals are moving more slowly than expected and no construction was started in 2002, we continue to proceed with our development and architecture plans so that we may start building as soon as all necessary approvals are received. We are very pleased that approval of the new interchange An interchange is a location where two things meet, usually perform some kind of exchange, and possibly go on their ways again. It is most commonly used in four contexts:
Thin piece of building material made of wood, asphaltic material, slate, metal, or concrete, laid in overlapping rows to shed water. Shingles are widely used as roof covering on residential buildings and sometimes also for siding (see Shingle style). Springs Band of Miwok Indians was received during 2002. This approval represented a major step forward in the regulatory approval process for the project. The neighboring neigh·bor n. 1. One who lives near or next to another. 2. A person, place, or thing adjacent to or located near another. 3. A fellow human. 4. Used as a form of familiar address. v. county has commenced litigation against the California regulatory agencies regulatory agency Independent government commission charged by the legislature with setting and enforcing standards for specific industries in the private sector. The concept was invented by the U.S. , attempting to block the approval of the interchange. We are assisting the agencies in vigorously defending their position and we hope the litigation will not result in a significant delay before construction can begin." Mr. Berman continued, "We remain focused on the successful development of our five potential new gaming locations as well as successful development of our new business opportunities to enhance shareholder value." The fourth quarter financial performance resulted in a loss of approximately $2.6 million or $.25 per share which included the $0.6 million after-tax charge relating to impairment of the Shark Club parcel. There were no revenues during the quarter as described above. Lakes Entertainment, Inc. currently has development and management agreements with four separate Tribes for four new casino operations, one in Michigan with the Pokagon Band of Potawatomi, one in the San Diego, California “San Diego” redirects here. For other uses, see San Diego (disambiguation). San Diego is a coastal Southern California city located in the southwestern corner of the continental United States. As of 2006, the city has a population of 1,256,951. area with the Jamul Indian Village, one in the Sacramento, California “Sacramento” redirects here. For other uses, see Sacramento (disambiguation). Sacramento is the capital of the State of California and the county seat of Sacramento County. area with the Shingle Springs Band of Miwok, and one with the Nipmuc Nation on the East Coast. Lakes Entertainment also has agreements for the development of one additional casino on Indian-owned land in California through a joint venture with MRD MRD or mrd abbr. minimal reacting dose Gaming. Additionally, the Company owns approximately 80% of World Poker Tour, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , a joint venture formed to film and produce poker tournaments for television broadcast. Lakes Entertainment, Inc. common shares are traded on the Nasdaq National Market under the trading symbol Trading symbol See: Ticker symbol "LACO". The Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 provides a "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " for 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. . Certain information included in this press release (as well as information included in oral statements or other written statements made or to be made by Lakes Entertainment, Inc.) contains statements that are forward-looking, such as statements relating to plan for future expansion and other business development activities as well as other capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. , financing sources and the effects of regulation (including gaming and tax regulation) and competition. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of the Company. These risks and uncertainties include, but are not limited to, possible delays in completion of Lakes' casino projects, including various regulatory approvals and numerous other conditions which must be satisfied before completion of these projects; possible termination or adverse modification of management contracts; continued indemnification Indemnification Used in insurance policy agreements as to compensation for damage or loss. In the context of corporate governance, Director Indemnification uses the bylaws and/or charter to indemnify officers and directors from certain legal expenses and judgements resulting from obligations to Grand Casinos Grand Casinos NYSE: GND was a casino operator that started out managing several casinos in Minnesota in 1990. The company ceased to exist when it was purchased by Hilton Hotels which then merged it with its other gaming properties to form Park Place Entertainment in ; highly competitive industry; possible changes in regulations; reliance on continued positive relationships with Indian tribes INDIAN TRIBE. A separate and distinct community or body of the aboriginal Indian race of men found in the United States. 2. Such a tribe, situated within the boundaries of a state, and exercising the powers of government and, sovereignty, under the national and repayment of amounts owned to Lakes by Indian tribes; possible need for future financing to meet Lakes' expansion goals; risks of entry into new businesses; and reliance on Lakes' management. For more information, review the Company's filings with the Securities and Exchange Commission.
LAKES GAMING, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands)
Dec. 29, Dec. 30,
2002 2001
----------------------------------------------------------------------
Assets
Current Assets:
Cash and cash equivalents $14,106 $42,638
Short-term investments - 2,027
Current installments of notes receivable - 67
Related party receivables - 4,000
Accounts receivable, net 116 3,601
Deferred tax asset 6,771 4,549
Other current assets 547 1,079
----------------------------------------------------------------------
Total Current Assets 21,540 57,961
----------------------------------------------------------------------
Property and Equipment-Net 6,962 6,300
----------------------------------------------------------------------
Other Assets:
Land held under contract for sale 28,832 30,826
Land held for development 27,791 24,965
Notes receivable-less current installments 70,955 53,201
Cash and cash equivalents-restricted 8,300 9,175
Investments in and notes from
unconsolidated affiliates 1,013 839
Deferred tax asset 3,835 3,870
Other long-term assets 6,657 6,042
----------------------------------------------------------------------
Total Other Assets 147,383 128,918
----------------------------------------------------------------------
Total Assets $175,885 $193,179
======================================================================
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $226 $105
Current maturities of long-term debt - 1,325
Current installments of capital lease
obligations - 123
Income taxes payable 5,564 3,906
Litigation and claims accrual 5,847 6,572
Accrued payroll and related 252 671
Other accrued expenses 3,486 2,670
----------------------------------------------------------------------
Total Current Liabilities 15,375 15,372
----------------------------------------------------------------------
Long-term Liabilities:
Capital lease obligations-less current
installments - 5,591
Other long-term liabilities - 225
----------------------------------------------------------------------
Total Long-Term Liabilities - 5,816
----------------------------------------------------------------------
Total Liabilities 15,375 21,188
----------------------------------------------------------------------
Commitments and Contingencies
Shareholders' Equity:
Capital stock, $.01 par value; authorized
100,000 shares; 10,638 common shares
issued and outstanding at December
29, 2002, and December 30,
2001 106 106
Additional paid-in-capital 131,525 131,525
Retained Earnings 28,879 40,420
Accumulated other comprehensive loss - (60)
----------------------------------------------------------------------
Total Shareholders' Equity 160,510 171,991
----------------------------------------------------------------------
Total Liabilities and Shareholders' Equity $175,885 $193,179
======================================================================
LAKES GAMING, INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(In thousands, except earnings per share)
Three Months Ended
----------------------------
Dec. 29, 2002 Dec. 30, 2001
------------- --------------
Revenues:
Management fee income $- $7,368
Costs and Expenses:
Selling, general and administrative 3,521 26,588
Depreciation and amortization 132 346
----------------------------------------------------------------------
Total Costs and Expenses 3,653 26,934
----------------------------------------------------------------------
Loss From Operations (3,653) (19,566)
----------------------------------------------------------------------
Other income (expense):
Interest income 118 279
Interest expense (20) (97)
Equity in loss of unconsolidated
affiliates (143) (100)
Loss on sale of land held for
development - (3,731)
Other - (684)
----------------------------------------------------------------------
Total other expense, net (45) (4,333)
----------------------------------------------------------------------
Loss before income taxes (3,698) (23,899)
Benefit for income taxes (1,054) (9,798)
----------------------------------------------------------------------
Net Loss ($2,644) ($14,101)
======================================================================
Basic Loss per Share ($0.24) ($1.33)
======================================================================
Diluted Loss per Share ($0.24) ($1.33)
======================================================================
Weighted Average Common Shares Outstanding 10,638 10,638
Dilutive Effect of Stock Compensation
Programs - -
----------------------------------------------------------------------
Weighted Average Common and Diluted
Shares Outstanding 10,638 10,638
======================================================================
LAKES GAMING, INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(In thousands, except earnings per share)
Twelve Months Ended
------------------------------
Dec. 29, 2002 Dec. 30, 2001
-------------- --------------
Revenues:
Management fee income $1,502 $34,854
Costs and Expenses:
Selling, general and administrative 17,892 34,649
Depreciation and amortization 481 1,329
----------------------------------------------------------------------
Total Costs and Expenses 18,373 35,978
----------------------------------------------------------------------
Loss From Operations (16,871) (1,124)
----------------------------------------------------------------------
Other income (expense):
Interest income 1,424 1,983
Interest expense (90) (170)
Equity in loss of unconsolidated
affiliates (459) (465)
Loss on land held for development - (3,731)
Write-down of unconsolidated
affiliates - (666)
Other - (684)
----------------------------------------------------------------------
Total other income (expense), net 875 (3,733)
----------------------------------------------------------------------
Loss before income taxes (15,996) (4,857)
Benefit for income taxes (4,455) (1,991)
----------------------------------------------------------------------
Net Loss ($11,541) ($2,866)
======================================================================
Basic Loss per Share ($1.08) ($0.27)
======================================================================
Diluted Loss per Share ($1.08) ($0.27)
======================================================================
Weighted Average Common Shares
Outstanding 10,638 10,638
Dilutive Effect of Stock Compensation
Programs - -
----------------------------------------------------------------------
Weighted Average Common and Diluted
Shares Outstanding 10,638 10,638
======================================================================
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