Station Casinos Announces Record Fourth Quarter Results and New Native American Contract.Business Editors LAS VEGAS--(BUSINESS WIRE)--Jan. 29, 2004 Station Casinos Station Casinos Inc. NYSE: STN is a Las Vegas, Nevada based gaming company. The company purchased several sites that were gaming-entitled meaning that major casinos can be built at that location without additional approvals. , Inc. (NYSE NYSE See: New York Stock Exchange :STN (SuperTwisted Nematic) A passive matrix LCD technology that provides better contrast than twisted nematic (TN) by twisting the molecules from 180 to 270 degrees. See DSTN. ) today announced the results of its operations for the fourth quarter ended December December: see month. 31, 2003. Highlights include: -- Adjusted for non-recurring items, 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. earnings were $0.42 per share compared to $0.18 in the prior year, a 133% increase. -- 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 (1) of $84.6 million, an increase of 40% over the prior year's quarter. -- Same-store revenues from the 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. operations increased 6% over the prior year's quarter, while same-store EBITDA margins were 34.3% compared to 32.9% last year. Excluding Green Valley Ranch ranch, large farm devoted chiefly to raising and breeding cattle, horses, sheep, and goats. The cattle ranch was introduced from Latin America to Texas and the plains of the W United States and Canada. Station, revenues from the Major Las Vegas properties increased 4% while EBITDA margins increased to 32.9% from 32.1% in the prior year. -- Same-store EBITDA from the Las Vegas operations increased 11% over the prior year. Excluding Green Valley Ranch Station, EBITDA increased 6% year over year. -- The company initiates guidance for the first quarter of 2004 of $87 million to $91 million of EBITDA and $0.44 to $0.48 of earnings per share. -- Entering into management and development agreements with the Mechoopda The Mechoopda is a Native American tribe located in northern California. The tribe speaks a language related to Maidu. The tribe was formerly centered in a village located about 3 1/2 miles (6 km) south of contemporary Chico, California. Indian Tribe 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 of Chico Chico (chē`kō), city (1990 pop. 40,079), Butte co., N Calif., in a region noted for its almond and walnut production; inc. 1872. Olives, kiwi fruit, grain, and nursery stock are also grown, and cattle are raised. , California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). to develop and manage the tribe's 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. project in Chico, California. -- The Company will pay its next quarterly dividend of $0.125 per share on March 4, 2004. Results of Operations The Company's net revenues for the fourth quarter ended December 31, 2003 were approximately $229.9 million, an increase of 14% compared to the prior year's quarter. EBITDA for the quarter was $84.6 million, an increase of 40% compared to the prior year's quarter. During the quarter, Adjusted Earnings (2) applicable to common stock were $27.1 million, or $0.42 per share, an increase of 133% over the prior year's $0.18 per share on a comparable basis. For the quarter ended December 31, 2003, the Company reported earnings from its Green Valley Ranch Station joint venture of $6.6 million, which represents a combination of Station's management fee ($1.6 million) plus 50% of Green Valley Ranch Station's operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. ($5.0 million). Green Valley Ranch Station generated EBITDA before management fees of $15.7 million, an increase of 33% compared to the prior year's quarter. Included in Station's interest expense is $1.2 million of interest related to this joint venture. The non-recurring items for the quarter consist of an $11.4 million after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. 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 for the goodwill related to the acquisition of Fiesta Rancho ran·cho n. pl. ran·chos Southwestern U.S. 1. A hut or group of huts for housing ranch workers. 2. A ranch. , a $24.7 million after-tax charge for the settlement of a lawsuit lawsuit: see procedure; tort. , $1.5 million in costs to develop new gaming opportunities, primarily in Native American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of gaming, $0.6 million in costs related to the cancellation of certain insurance policies, $0.8 million for the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of debt issuance costs at Green Valley Ranch Station, all of which were partially offset by a $2.2 million reduction in federal income taxes. Including these items, the Company reported net loss of $8.6 million and loss applicable to common stock of $0.14 per share. Las Vegas Market Results Same-store (Major Las Vegas Operations and Green Valley Ranch Station) net revenues for the quarter increased to $241.0 million, a 6% increase compared to the prior year, while EBITDA at those operations increased 11% to $82.7 million. "At the beginning of the year we projected revenue would grow at approximately 4% for the year, with the second half of the year stronger than the first half and that is exactly what occurred. Our Jumbo jum·bo n. pl. jum·bos An unusually large person, animal, or thing. adj. Unusually large: jumbo shrimp; a jumbo jet. brand product offerings and the continuing population growth in Las Vegas are driving increased revenues," stated Glenn C. Christenson, executive vice president and chief financial officer. Same-store EBITDA margins increased to 34.3% compared to 32.9% during the fourth quarter of last year. For the quarter and year ended December 31, 2003, revenues at Fiesta Rancho were essentially flat with the prior year partially due to prolonged pro·long tr.v. pro·longed, pro·long·ing, pro·longs 1. To lengthen in duration; protract. 2. To lengthen in extent. road construction around the property. The Company has however reduced its growth assumptions for the property and, as a result, the accounting rules mandated the company record an $11.4 million after tax charge in the fourth quarter related to the value of the goodwill. EBITDA and Adjusted Earnings are not generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") measurements and are presented solely as a supplemental disclosure because the Company believes that they are widely used measures of operating performance in the gaming industry and as a principal basis for valuation of gaming companies. EBITDA and Adjusted Earnings are further defined in footnotes 1 and 2, respectively. United Auburn Indian Community The United Auburn Indian Community (UAIC) is a Native American tribe comprised mostly of Miwok and Maidu Indians indigenous to the Sacramento Valley region. The historic Auburn Rancheria is located in the Sierra Nevada foothills near Auburn, California. Thunder Valley Thunder Valley is the sixteenth novel in World of Adventure series by Gary Paulsen. The story is about Jeremy and Jason Parsons who are left to take care of their grandparents Thunder Valley Ski Lodge while their grandma goes to visit their grandfather in hospital Casino, which opened on June June: see month. 9, 2003 and is managed by Station for the United Auburn Indian Community, generated management fees to Station of $17.2 million during the quarter. Lawsuit Settlement The Company has reached an agreement in principle to settle a lawsuit brought by Fitzgerald's Fitzgerald's is one of the oldest and widely recognized live music venues in the Greater Houston area. The club has been at the top of the live music scene in Houston since it opened in 1977. Sugar Creek Sugar Creek may refer to: Cities and towns:
Sugar Creek is located at (39.118014, -94.435630)GR1. and Phillip Phillip is a variant of the name Philip. It may refer to: Given name:
Missouri (mĭz  r`ē, –ə), one of the midwestern states of the United States. legal counsel, Michael Michael, archangelMichael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. Lazaroff. The Company has asserted a claim against Mr. Lazaroff and his former law firm to recover all damages caused by Mr. Lazaroff's conduct. As part of that claim, the Company intends to seek reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. for, among other things, the amount it was required to pay to settle the Fitzgerald's 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. , as well as the attorney's fees attorney's fee n. the payment for legal services. It can take several forms: 1) hourly charge, 2) flat fee for the performance of a particular service (like $250 to write a will), 3) contingent fee (such as one-third of the gross recovery, and nothing if there is no and costs incurred by the Company in defending that litigation. Balance Sheet Items and Capital Expenditures Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. was $1.16 billion as of December 31, 2003. Total capital expenditures totaled $38.1 million for the quarter ended December 31, 2003 and consisted of $10.5 million of maintenance capital expenditures, $14.1 million of expansion capital expenditures and $13.5 million for the accelerated replacement of slot machines to take advantage of ticket-in ticket-out technology. The long-term debt balance at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. is approximately $17 million higher than our previous guidance. The difference is due primarily to entering into an agreement to purchase an additional piece of land adjacent to the Wild Wild West site for $6.3 million and advances to and consolidating MPM MPM Multi-Processing Module (Apache) MPM Manufacturing Process Management MPM Milwaukee Public Museum MPM MMW (Millimeter Wave) Power Module MPM Master of Project Management (degree) Enterprises LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , our 50% owned joint venture that will manage the Gun Lake project, which resulted in approximately $11 million of additional debt as of December 31, 2003, which is offset by a receivable from the Gun Lake 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 . See the Company's press release dated January January: see month. 15, 2004 for more detail on the projected 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. for the next three years. As of December 31, 2003, the Company's debt to cash flow ratio as defined in its bank credit facility was 3.6 to 1, which reflects annualizing Annualizing See: Annual basis. the management fees from Thunder Valley Casino. The Company plans to issue $400 million of 6 1/2% senior subordinated notes due in 2014. The proceeds from the offering will be used to redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. $199.9 million senior subordinated notes due in December of 2008, to reduce the Company's revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility and for general corporate purposes. Mechoopda Indian Tribe Management Agreement The Company also announced today that it has entered into Development and Management Agreements with the Mechoopda Indian Tribe of Chico Rancheria rancheria (ränchā`rēä), type of communal settlement formerly characteristic of the Yaqui Indians of Sonora, Mexico, and of various small Native American groups of the SW United States, especially in California. , California (the "Tribe"), a federally recognized Indian tribe. Station will assist the Tribe in developing and operating a gaming and entertainment project to be located in Butte County, California Butte County is a county located in the Central Valley of the U.S. state of California, north of state capital Sacramento. As of the 2000 census, it had a population of 203,171. 2005 estimates place this at 214,185. The county seat is Oroville. (the "Project"), at the intersection intersection /in·ter·sec·tion/ (-sek´shun) a site at which one structure crosses another. intersection a site at which one structure crosses another. of State Route 149 and Highway 99, approximately 10 miles southeast of Chico, California and 80 miles north of 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. . Under the terms of the Development Agreement, Station has agreed to arrange the financing for the ongoing development costs and construction of the Project. Prior to obtaining financing for the Project, the Company expects to advance $5 million to $10 million to the Tribe for the acquisition of land and other development costs. Although no firm construction budget has been established, the Company expects the total cost of the development and construction of the Project will be less than $80 million. Funds advanced by Station are expected to be repaid from the proceeds of the project financing Project financing A form of asset-based financing in which a firm finances a discrete set of assets on a stand-alone basis. or from the Tribe's gaming revenues. The Management Agreement has a term of seven years and provides for a management fee of 24% of the Project's net income. The proposed Project will be located on approximately 650 acres on State Route 149, at the intersection with Highway 99. As currently contemplated, the Project will include approximately 500 slot machines, 10 table games and dining and entertainment amenities. Station anticipates the gaming and entertainment facility will be open some time during 2005. Steve v. t. 1. To pack or stow, as cargo in a ship's hold. See Steeve. C. Santos Santos (sän`t  s), city (1996 pop. 412,288), São Paulo state, SE Brazil, on the island of São Vicente in the Atlantic just off the mainland. , Tribal Chairman commented,
"Station's excellent reputation and extensive experience in
the gaming industry will help make our dream of economic sufficiency a
reality. With Station's help, we look forward to building a
first-class gaming facility that will generate hundreds of jobs and spur
interest in our local economy." "We are excited about the
opportunity to work with the Tribe in developing a quality gaming
facility. The property is in a very underserved area of the Northern
California Northern California, sometimes referred to as NorCal, is the northern portion of the U.S. state of California. The region contains the San Francisco Bay Area, the state capital, Sacramento; as well as the substantial natural beauty of the redwood forests, the northern market and we look forward to adding another project to our
Native American franchise," stated Christenson.First Quarter 2004 and Year 2004 Guidance The Company expects EBITDA of approximately $87 million to $91 million for the first quarter of 2004 (excluding development expense, costs related to the early retirement of the $199.9 million 8 7/8% senior subordinated notes and other non-recurring items). This would result in earnings per share ("EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ") of $0.44 to $0.48 for the first quarter of 2004. Our general guidance has been to grow revenues in the 4% to 5% range. To date in January, our revenue growth from our Las Vegas operations excluding Green Valley Ranch Station is approximately 7%. While it is too soon to change our guidance for the year, and there are no guarantees, we are cautiously optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op with what we are seeing thus far in the market. For 2004, the Company expects EBITDA of approximately $340 million to $350 million (excluding development expense and non-recurring items) and EPS of approximately $1.68 to $1.78 assuming 65 million fully diluted shares. Development costs are expected to be approximately $5 million, which does not include non-reimbursable project costs related to certain management contracts as certain milestones are met on each development project. This guidance assumes revenue growth of 4% to 5% in Las Vegas with an approximate 50% flow through and an effective tax rate of 36.5%. Dividend The Board of Directors has declared a quarterly cash dividend of $0.125 per share. The dividend is payable on March 4, 2004 to shareholders of record on February February: see month. 12, 2004. "Our dividend policy is consistent with the balanced approach to the allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as of our free cash flow. We think it makes sense to return cash to our shareholders as part of our overall strategy to enhance shareholder value while still taking advantage of the substantial growth opportunities the Company controls," stated Christenson. Conference Call Information The Company will host a conference call today, Thursday, January 29, 2004, at 9:00 AM (PT) to discuss its fourth quarter financial results and provide guidance for 2004. Interested participants may access the call by dialing in to the conference operator at 888- 722-1081. A live audio webcast of the call, as well as supplemental tables and charts, will also be available at the Company's website, www.stationcasinos.com. (3) A replay of the call will be available from 11:00 AM (PT) on January 29, 2004, until 11:00 AM (PT) on February 5, 2004 at 800-633-8284. The reservation number is 21180703. Company Information and Forward Looking Statements Station Casinos, Inc. is the leading provider of gaming and entertainment to the residents of Las Vegas, Nevada. Station's properties are regional entertainment destinations and include various amenities, including numerous restaurants, entertainment venues, movie theaters, bowling and convention/banquet space, as well as traditional casino gaming offerings such as video poker Video poker is a casino game based on five-card draw poker. It is played on a computerized console which is a similar size to a slot machine. History Video poker first became commercially viable when it became economical to combine a television-like monitor with a , slot machines, table games, bingo bingo Game of chance played with cards having a grid of numbered squares corresponding to numbered balls drawn at random. When a number on the card is drawn, the players cover that number (should they have it); the game is won by covering a certain number of squares in a row and race and sports 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. . Station owns and operates Palace Station Hotel & Casino, Boulder Boulder, city, United States Boulder, city (1990 pop. 83,312), seat of Boulder co., N central Colo.; inc. 1871. A Rocky Mountain resort and a suburb of Denver, it is the seat of the Univ. of Colorado (1876). Station Hotel & Casino, Santa Fe Santa Fe, city, Argentina Santa Fe, city (1991 pop. 341,000), capital of Santa Fe prov., NE Argentina, a river port near the Paraná, with which it is connected by canal. Station Hotel & Casino, Wildfire Casino and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Nevada is a city in Collin County, Texas, United States. The population was 563 at the 2000 census. First settled in 1835 by John McMinn Stambaugh and named McMinn Chapel Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada North Las Vegas is a city in Clark County, Nevada, United States. As of the 2000 census, the city had a total population of 115,488, with a Census Bureau estimate of 197,567 as of 2006, and a Clark County estimate of 202,520 as of July 1, 2006 [2]. , and Sunset Station Hotel & Casino and Fiesta Henderson Casino Hotel in Henderson, Nevada Henderson is a city in Clark County, Nevada, United States, seven miles southeast of Las Vegas. As of the 2000 census, the city had a total population of 175,381, with a 2006 Census estimate placing the population at 240,614. . Station also owns a 50% interest in both Barley's Casino & Brewing brewing: see beer. Company and Green Valley Ranch Station Casino in Henderson, Nevada and a 6.7% interest in the Palms Casino Resort in Las Vegas, Nevada. In addition, Station manages the Thunder Valley Casino in Sacramento, California on behalf of the United Auburn Indian Community. This press release contains certain 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. with respect to the business, financial condition, results of operations, dispositions, acquisitions and expansion projects of the Company and its subsidiaries which involve risks and uncertainties that cannot be predicted or quantified, and consequently, actual results may differ materially from those expressed or implied herein. Such risks and uncertainties include, but are not limited to, financial market risks, the ability to maintain existing management, integration of acquisitions, competition within the gaming industry, the cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. nature of the hotel business and gaming business, economic conditions, regulatory matters and litigation and other risks described in the filings of the Company with the Securities and Exchange Commission, including, but not limited to, the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2002, and its Registration Statement on Form S-4 File No. 333-66140. All forward-looking statements are based on the Company's current expectations and projections about future events. All forward-looking statements speak only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" and the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Additional financial information, including presentations from recent investor conferences, is available in the "Investors" section of the Company's website at www.stationcasinos.com.(3) Construction projects such as the Green Valley Ranch Station expansion entail entail, in law, restriction of inheritance to a limited class of descendants for at least several generations. The object of entail is to preserve large estates in land from the disintegration that is caused by equal inheritance by all the heirs and by the ordinary significant risks, including shortages of materials or skilled labor, unforeseen regulatory problems, work stoppages, weather interference, floods and unanticipated cost increases. The anticipated costs and construction periods are based on budgets, conceptual design documents and construction schedule estimates. There can be no assurance that the budgeted costs or construction period will be met. In September 2002, the United States District Court for the District of Columbia The United States District Court for the District of Columbia is the United States District Court that hears cases originating in the District of Columbia over which federal courts have original jurisdiction. ruled in favor of upon the side of; favorable to; for the advantage of. See also: favor the Department of the Interior and the UAIC UAIC United Auburn Indian Community UAIC University of Alabama Ichthyological Collection UAIC Union of Associations of Industry and Commerce UAIC United Arab Investors Company (Amman, Jordan) UAIC United American Insurance Company and granted the Department of the Interior's and the UAIC's motions for summary judgment, resulting in the dismissal of the claims challenging the Department of the Interior's decision to accept land into trust for the benefit of the UAIC. In November 2003, the United States Court of Appeals The United States courts of appeals (or circuit courts) are the intermediate appellate courts of the United States federal court system. A court of appeals decides appeals from the district courts within its federal judicial circuit, and in some instances from other for the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). Circuit 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. the lower Court's decision. The case may be further appealed to the United States Supreme Court United States Supreme Court: see Supreme Court, United States. . There can be no assurance as to the ultimate outcome of any such appeal. The agreement in principle to settle the lawsuit between the Company and Fitzgerald's Sugar Creek Inc., the City of Sugar Creek, Missouri (the "City") and Phillip Griffith is subject to the approval of the City (through its city council or other governing body Noun 1. governing body - the persons (or committees or departments etc.) who make up a body for the purpose of administering something; "he claims that the present administration is corrupt"; "the governance of an association is responsible to its members"; "he ) of the settlement agreement. The parties have agreed to use their best efforts to cause the City to obtain such approval and to execute a definitive agreement within 10 days. (1) EBITDA consists of net income plus change in accounting principle, income tax provision, interest and other expense, loss on early retirement of debt, litigation settlement, impairment loss, depreciation, amortization, development expense, cancellation of certain insurance policies, employer taxes on stock exercises, Regulation 6A investigative costs, Harrah's patent litigation costs, write-off of our 50% investment in a restaurant at Green Valley Ranch Station, asset reserves and restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. , less Thunder Valley development fee and insurance proceeds. EBITDA is presented solely as a supplemental disclosure because the Company believes that it is a widely used measure of operating performance in the gaming industry and as a principal basis for valuation of gaming companies. The Company believes that in addition to cash flows and net income, EBITDA is a useful financial performance measurement for assessing the operating performance of the Company. Together with net income and cash flows, EBITDA provides investors with an additional basis to evaluate the ability of the Company to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. and service debt and incur capital expenditures. To evaluate EBITDA and the trends it depicts, the components should be considered. The impact of change in accounting principle, income tax provision, interest and other expense, loss on early retirement of debt, litigation settlement, impairment loss, depreciation, amortization, development expense, cancellation of certain insurance policies, employer taxes on stock exercises, Regulation 6A investigative costs, Harrah's patent litigation costs, write-off of our 50% investment in a restaurant at Green Valley Ranch Station, insurance proceeds, Thunder Valley development fee, asset reserves and restructuring charges, each of which can significantly affect the Company's results of operations and liquidity and should be considered in evaluating the Company's operating performance, cannot be determined from EBITDA. Further, EBITDA does not represent net income or cash flows from operating, financing and investing activities as defined by generally accepted accounting principles ("GAAP") and does not necessarily indicate cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income, as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. In addition, it should be noted that not all gaming companies that report EBITDA or adjustments to such measures may calculate EBITDA or such adjustments in the same manner as the Company, and therefore, the Company's measure of EBITDA may not be comparable to similarly titled measures used by other gaming companies. A reconciliation of EBITDA to net income is included in the financial schedules accompanying this release. (2) Adjusted Earnings excludes development fee and interest income related to Thunder Valley, income tax adjustment, development expense, employer taxes on stock exercises, Regulation 6A investigative costs, Harrah's patent litigation costs, impairment loss, litigation settlement, loss on early retirement of debt, cancellation of certain insurance policies, write-off of our 50% investment in a restaurant at Green Valley Ranch Station, change in accounting principle, insurance proceeds, asset reserves and restructuring charges. Adjusted Earnings is presented solely as a supplemental disclosure because the Company believes that it is a widely used measure of operating performance in the gaming industry and as a principal basis for valuation of gaming companies, as this measure is considered by the Company to be a better measure on which to base expectations of future results than GAAP net income. A reconciliation of Adjusted Earnings and EPS to GAAP net income and EPS is included in the financial schedules accompanying this release. (3) The hyperlink A predefined linkage between one object and another. See hypertext. hyperlink - anchor to the Company's URL URL in full Uniform Resource Locator Address of a resource on the Internet. The resource can be any type of file stored on a server, such as a Web page, a text file, a graphics file, or an application program. is included herein solely for the convenience of investors in accessing the audio webcast of the fourth quarter conference call. All other references herein to the Company's URL are inactive in·ac·tive adj. 1. Not active or tending to be active. 2. a. Not functioning or operating; out of use: inactive machinery. b. textual tex·tu·al adj. Of, relating to, or conforming to a text. tex  tu·al·ly adv. references. None of the
information contained on the Company's website shall be deemed
incorporated by reference or otherwise included herein.
Station Casinos Inc.
Condensed Consolidated Balance Sheets
(amounts in thousands)
(unaudited)
December 31,
-----------------------
2003 2002
----------- -----------
Assets:
Cash and cash equivalents $62,272 $59,339
Receivables, net 28,224 15,423
Other current assets 43,968 27,747
----------- -----------
Total current assets 134,464 102,509
Property and equipment, net 1,158,299 1,046,051
Other long-term assets 453,209 449,787
----------- -----------
Total assets $1,745,972 $1,598,347
=========== ===========
Liabilities and stockholders' equity:
Current portion of long-term debt $22 $122
Other current liabilities 142,294 88,677
----------- -----------
Total current liabilities 142,316 88,799
Revolving credit facility 177,000 177,200
Senior and senior subordinated notes 973,786 973,669
Other debt 6,060 -
Interest rate swaps, mark-to-market 12,089 14,731
Other long-term liabilities 94,782 73,270
----------- -----------
Total liabilities 1,406,033 1,327,669
Stockholders' equity 339,939 270,678
----------- -----------
Total liabilities and stockholders' equity $1,745,972 $1,598,347
=========== ===========
Station Casinos Inc.
Condensed Consolidated Statements of Operations
(amounts in thousands, except per share data)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
2003 2002 2003 2002
--------- --------- --------- ---------
Operating revenues:
Casino $168,774 $161,944 $648,664 $638,113
Food and beverage 35,134 35,823 133,676 133,811
Room 12,960 12,285 50,460 48,579
Other 10,908 10,102 45,943 40,790
Management fees 18,942 1,320 46,711 4,853
--------- --------- --------- ---------
Gross revenues 246,718 221,474 925,454 866,146
Promotional allowances (16,865) (19,867) (67,365) (73,281)
--------- --------- --------- ---------
Net revenues 229,853 201,607 858,089 792,865
--------- --------- --------- ---------
Operating costs and expenses:
Casino 68,591 67,573 265,203 258,383
Food and beverage 24,882 20,573 87,783 78,738
Room 4,952 4,750 19,580 19,000
Other 3,802 4,329 15,452 16,276
Selling, general and
administrative 41,111 39,796 161,643 161,038
Corporate expense 8,386 8,119 33,039 31,946
Development expense 1,447 - 4,306 -
Depreciation and amortization 18,569 17,933 73,144 72,783
Impairment loss 17,474 4,915 18,868 8,791
Litigation settlement 38,000 - 38,000 -
--------- --------- --------- ---------
227,214 167,988 717,018 646,955
--------- --------- --------- ---------
Operating income 2,639 33,619 141,071 145,910
Earnings from joint ventures 5,816 3,461 20,604 11,293
--------- --------- --------- ---------
Operating income and earnings
from joint ventures 8,455 37,080 161,675 157,203
--------- --------- --------- ---------
Other income (expense):
Interest expense (22,182) (23,974) (92,940) (96,795)
Interest and other expense
from joint ventures (1,993) (1,533) (6,409) (6,272)
Interest income 6 9 4,873 106
Loss on early retirement of
debt (824) (4,381) (824) (5,808)
Other 603 162 1,802 1,322
--------- --------- --------- ---------
(24,390) (29,717) (93,498) (107,447)
--------- --------- --------- ---------
Income (loss) before income
taxes and cumulative effect
of change in accounting
principle (15,935) 7,363 68,177 49,756
Income tax benefit (provision) 7,287 (2,823) (23,834) (18,508)
--------- --------- --------- ---------
Income (loss) before
cumulative effect of change
in accounting principle (8,648) 4,540 44,343 31,248
Cumulative effect of change in
accounting principle, net
of applicable income
tax benefit of $7,170 - - - (13,316)
--------- --------- --------- ---------
Net income (loss) $(8,648) $4,540 $44,343 $17,932
========= ========= ========= =========
Basic and diluted earnings per
common share:
Income (loss) before cumulative
effect of change in accounting
principle
Basic $(0.14) $0.08 $0.76 $0.54
Diluted $(0.14) $0.07 $0.72 $0.51
Net income (loss)
Basic $(0.14) $0.08 $0.76 $0.31
Diluted $(0.14) $0.07 $0.72 $0.30
Weighted average common shares
outstanding
Basic 60,176 57,912 58,371 57,845
Diluted 60,176 61,388 61,850 60,730
Dividends paid per common
share $0.125 $- $0.250 $-
Station Casinos Inc.
Summary Information and
Reconciliation of Net Income (Loss) to EBITDA
(amounts in thousands, except occupancy percentage and ADR)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
2003 2002 2003 2002
--------- --------- --------- ---------
Major Las Vegas Operations (a):
------------------------------
Net revenues $203,268 $195,734 $781,061 $768,813
Net income $11,038 $18,763 $69,782 $59,823
Change in accounting
principle, net of applicable
income tax benefit - - - 13,069
Income tax provision 6,481 11,019 40,980 42,810
Interest and other expense,
net 14,377 15,918 59,804 69,468
Impairment loss 17,474 - 17,474 -
Depreciation and amortization 17,561 17,190 69,535 69,814
Regulation 6A investigative
costs - - 520 -
--------- --------- --------- ---------
EBITDA $66,931 $62,890 $258,095 $254,984
========= ========= ========= =========
Green Valley Ranch Station
(50% owned):
------------------------------
Net revenues $37,690 $31,442 $139,128 $118,541
Net income $4,377 $3,564 $21,203 $8,665
Interest and other expense,
net 5,595 4,319 18,950 17,093
Preopening expenses - - - 285
Write off of a restaurant
investment - - - 1,402
Loss on early retirement of
debt 1,648 - 1,648 -
Depreciation and amortization 4,101 3,901 16,390 15,511
--------- --------- --------- ---------
EBITDA $15,721 $11,784 $58,191 $42,956
========= ========= ========= =========
Same-Store Operations (b):
------------------------------
Net revenues $240,958 $227,176 $920,189 $887,354
Net income $15,415 $22,327 $90,985 $68,488
Change in accounting
principle, net of applicable
income tax benefit - - - 13,069
Income tax provision 6,481 11,019 40,980 42,810
Interest and other expense,
net 19,972 20,237 78,754 86,561
Preopening expenses - - - 285
Write off of a restaurant
investment - - - 1,402
Loss on early retirement of
debt 1,648 - 1,648 -
Impairment loss 17,474 - 17,474 -
Depreciation and amortization 21,662 21,091 85,925 85,325
Regulation 6A investigative
costs - - 520 -
--------- --------- --------- ---------
EBITDA $82,652 $74,674 $316,286 $297,940
========= ========= ========= =========
Station Casinos Inc.
Summary Information and
Reconciliation of Net Income (Loss) to EBITDA
(amounts in thousands, except occupancy percentage and ADR)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
2003 2002 2003 2002
--------- --------- --------- ---------
Total Station Casinos Inc. (c):
------------------------------
Net revenues $229,853 $201,607 $858,089 $792,865
Thunder Valley development
fee - - (4,407) -
Thunder Valley management fee (17,191) - (40,268) -
--------- --------- --------- ---------
Net revenues excluding Thunder
Valley $212,662 $201,607 $813,414 $792,865
Net income (loss) $(8,648) $4,540 $44,343 $17,932
Change in accounting
principle, net of applicable
income tax benefit - - - 13,316
Income tax provision (benefit) (7,287) 2,823 23,834 18,508
Interest and other expense,
net 23,566 25,336 92,674 101,639
Loss on early retirement of
debt 824 4,381 824 5,808
Litigation settlement 38,000 - 38,000 -
Impairment loss 17,474 4,915 18,868 8,791
Depreciation and amortization 18,569 17,933 73,144 72,783
Development expense 1,447 - 4,306 -
Corporate expense less
employer taxes on stock
exercises, Harrah's patent
litigation costs and
cancellation of certain
insurance policies 7,768 7,469 29,947 30,174
Employer taxes on stock
exercises - - 681 -
Harrah's patent litigation
costs - 1,521 1,793 2,643
Cancellation of certain
insurance policies 618 - 618 -
Regulation 6A investigative
costs - - 520 -
Asset reserves and
restructuring charges, net - (871) - 5
Write off of a restaurant
investment at Green Valley
Ranch Station (50%) - - - 701
Thunder Valley development
fee - - (4,407) -
Thunder Valley management fee (17,191) - (40,268) -
Insurance proceeds - - - (1,580)
--------- --------- --------- ---------
EBITDA from Las Vegas
operations 75,140 68,047 284,877 270,720
Thunder Valley management fee 17,191 - 40,268 -
--------- --------- --------- ---------
EBITDA before corporate
expense 92,331 68,047 325,145 270,720
Less corporate expense (7,768) (7,469) (29,947) (30,174)
--------- --------- --------- ---------
EBITDA $84,563 $60,578 $295,198 $240,546
========= ========= ========= =========
Occupancy percentage 91% 92% 94% 91%
ADR $52 $50 $50 $50
(a) The Major Las Vegas Operations include the wholly owned properties
of Palace Station, Boulder Station, Texas Station, Sunset Station,
Santa Fe Station, Fiesta Rancho and Fiesta Henderson.
(b) Same-Store Operations include the Major Las Vegas Operations plus
the total operations of Green Valley Ranch Station.
(c) Total Station Casinos Inc. includes the Major Las Vegas
Operations, Wild Wild West, Wildfire (since Jan. 27, 2003), the
company's earnings from joint ventures and corporate expense.
Station Casinos Inc.
Reconciliation of GAAP Net Income (Loss) and EPS
to Adjusted Earnings and EPS
(amounts in thousands, except per share data)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
----------------- -----------------
2003 2002 2003 2002
-------- -------- -------- --------
Adjusted Earnings
Net income (loss) $(8,648) $4,540 $44,343 $17,932
Thunder Valley development fee,
net - - (2,865) -
Thunder Valley interest income,
net - - (3,149) -
Development expense, net 941 - 2,799 -
Employer taxes on stock
exercises, net - - 443 -
Harrah's patent litigation
costs, net - 958 1,165 1,665
Cancellation of certain
insurance policies 402 - 402 -
Regulation 6A investigative
costs, net - - 338 -
Impairment loss, net 11,358 3,096 12,264 5,538
Litigation settlement 24,700 - 24,700 -
Loss on early retirement of
debt, net 536 2,760 536 3,659
Reduction in federal income
taxes (2,152) - (2,152) -
Write off of investment in
restaurant at Green Valley
Ranch Station, net (50%) - - - 442
Change in accounting principle,
net - - - 13,316
Insurance proceeds, net - - - (995)
Asset reserves and restructuring
charges, net - (549) - 2
-------- -------- -------- --------
Adjusted Earnings $27,137 $10,805 $78,824 $41,559
======== ======== ======== ========
Adjusted basic earnings (loss)
per common share:
Net income (loss) $(0.14) $0.08 $0.76 $0.31
Thunder Valley development fee,
net - - (0.05) -
Thunder Valley interest income,
net - - (0.05) -
Development expense, net 0.01 - 0.05 -
Employer taxes on stock
exercises, net - - 0.01 -
Harrah's patent litigation
costs, net - 0.02 0.02 0.03
Cancellation of certain
insurance policies 0.01 - 0.01 -
Regulation 6A investigative
costs, net - - 0.01 -
Impairment loss, net 0.19 0.05 0.21 0.10
Litigation settlement 0.41 - 0.41 -
Loss on early retirement of
debt, net 0.01 0.05 0.01 0.06
Reduction in federal income
taxes (0.04) - (0.04) -
Write off of investment in
restaurant at Green Valley
Ranch Station, net (50%) - - - 0.01
Change in accounting principle,
net - - - 0.23
Insurance proceeds, net - - - (0.02)
Asset reserves and restructuring
charges, net - (0.01) - -
-------- -------- -------- --------
Adjusted basic earnings per
common share $0.45 $0.19 $1.35 $0.72
======== ======== ======== ========
Weighted average common shares
outstanding - basic 60,176 57,912 58,371 57,845
Adjusted diluted earnings per
common share:
Net income (loss) $(0.14) $0.07 $0.72 $0.30
Thunder Valley development fee,
net - - (0.05) -
Thunder Valley interest income,
net - - (0.05) -
Development expense, net 0.01 - 0.04 -
Employer taxes on stock
exercises, net - - 0.01 -
Harrah's patent litigation
costs, net - 0.02 0.02 0.03
Cancellation of certain
insurance policies - - - -
Regulation 6A investigative
costs, net - - - -
Impairment loss, net 0.18 0.05 0.20 0.09
Litigation settlement 0.39 - 0.40 -
Loss on early retirement of
debt, net 0.01 0.05 0.01 0.06
Reduction in federal income
taxes (0.03) - (0.03) -
Write off of investment in
restaurant at Green Valley
Ranch Station, net (50%) - - - -
Change in accounting principle,
net - - - 0.22
Insurance proceeds, net - - - (0.02)
Asset reserves and restructuring
charges, net - (0.01) - -
-------- -------- -------- --------
Adjusted diluted earnings per
common share $0.42 $0.18 $1.27 $0.68
======== ======== ======== ========
Weighted average common shares
outstanding - diluted 64,144 61,388 61,850 60,730
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