CAESARS WORLD REPORTS FY92 FIRST QUARTER RESULTS
EARNINGS PER SHARE RISE TO RECORD LEVEL
LOS ANGELES, Nov. 19 /PRNewswire/ -- Caesars World Inc. (NYSE: CAW) today announced net income for its fiscal 1992 first quarter was $22,902,000, or $.95 per share, compared with $14,017,000, or $.60 per share, in the fiscal 1991 first quarter. The fiscal 1992 earnings-per-share results established a record for any quarter in the company's history and represented a 58 percent increase over the comparable prior-year period.
Revenue for the quarter ended Oct. 31, 1991, totaled $233,092,000, compared with $235,598,000 in the first quarter of the previous fiscal year.
Henry Gluck, Caesars World's chairman and chief executive officer, said the primary factor in the earnings improvement came from New Jersey where both revenue and operating income surpassed Caesars Atlantic City's own previous highs for any quarter.
When comparing the fiscal first quarters, the New Jersey resort achieved a 123 percent increase in its contribution to Caesars World's operating income. The main contributors to this improvement were table-game win percentages higher than the 1991 quarter's low percentages, improved slot activity and lower expenses resulting from more cost-effective marketing programs.
For the second consecutive quarter, slot revenue reached a record level at Caesars Atlantic City, rising 16 percent over the same prior-year quarter. This compared with an eight percent increase in the overall Atlantic City slot market during the same period.
In Nevada, contributions to operating income were down slightly when comparing the fiscal 1992 and 1991 first quarters. The decline was attributable to lower operating income at Caesars Tahoe in northern Nevada which offset improved operating income results at Caesars Palace in Las Vegas. Table-game activity was down at both Nevada properties and the Caesars Tahoe results were also affected by significantly lower win percentages. Improved collections and less credit activity resulting in a substantially lower provision for bad debt, lower marketing expenses, higher win percentages and an increase in slot activity were positive factors in Caesars Palace's performance.
The company pointed out that it is common practice for customers to plan trips around special events and that November results indicate many Caesars Palace guests deferred visits during the fiscal 1992 first quarter in anticipation of the previously scheduled November heavyweight championship fight between Evander Holyfield and Mike Tyson. These visitation deferrals, plus the world economic climate, apparently slowed down international and other high-level play in the company's Nevada operations and reduced the average level of activity per customer during the quarter. Although the Holyfield- Tyson fight, scheduled for Nov. 8, was postponed following an injury to Tyson, a number of customers made their previously planned visits to Caesars Palace at that time. Discussions are continuing to determine the new date for the Holyfield-Tyson fight at Caesars Palace.
The company's increase in other expenses, when comparing the fiscal 1992 and 1991 quarters, was primarily the result of higher costs associated with stock appreciation rights. Other expenses were partially offset by improved results from merchandising operations.
Minority interest charges were eliminated when Caesars New Jersey became a wholly owned subsidiary of Caesars World in December 1990.
CAESARS WORLD INC.
Summary of Earnings
(In thousands, except net income per share)
For the periods ended Oct. 31,
Nevada $121,180 $137,784
New Jersey 93,371 79,039
operations 214,551 216,823
Pocono resorts 13,568 13,715
Other(a) 4,973 5,060
Total revenue $233,092 $235,598
Nevada $22,966 $23,377
New Jersey 24,429 10,936
operations 47,395 34,313
Pocono resorts 4,609 4,690
Other expenses(a) (3,566) (3,040)
Operating income 48,438 35,963
Interest and dividend
income 383 143
Interest expense (11,643) (12,519)
Income before income
taxes and minority
interest 37,178 23,587
Income taxes 14,276 8,798
Minority interest --- 772
Net income $22,902 $14,017
Net income per share $ .95 $ .60
Average number of common
and common equivalent
shares outstanding 24,062 23,409
(a) Other revenue is primarily from merchandising operations. Other expenses include the contribution from merchandising operations and corporate expenses.
/CONTACT: Jack Leone of Caesars World Inc., 213-552-2711, ext. 263/
(CAW) CO: Caesars World Inc. ST: California IN: CNO SU: ERN SE-EH -- LA009 -- 4786 11/19/91 08:54 EST