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GRAND CASINOS REPORTS PROFITABLE FIRST QUARTER; INDIAN CASINO OPERATION PROVIDES JOBS FOR 850 AT MILLE LACS

 GRAND CASINOS REPORTS PROFITABLE FIRST QUARTER;
 INDIAN CASINO OPERATION PROVIDES JOBS FOR 850 AT MILLE LACS
 MINNEAPOLIS, Dec. 9 /PRNewswire/ -- Positive consumer reaction coupled with excellent service levels enabled Grand Casinos, Inc. (NASDAQ: GRND) which manages a Las Vegas-style casino on the Mille Lacs Indian reservation, to operate profitably in its first fiscal quarter.
 "Since its opening in April of this year, the Grand Casino Mille Lacs has exceeded our expectations in terms of its ability to provide jobs for our people and revenues for our long-term development programs," said Marge Anderson, chief executive of the Mille Lacs Band. "Among the projects that will be funded because of the casino's profitability are a new school, clinic, day care and utility upgrade, along with badly needed housing."
 Grand Casino Mille Lacs, owned by the Mille Lacs Band of Ojibwe Indians, drew almost 400,000 visitors during the fiscal quarter. The 60,000-square-foot casino employs more than 850 people, helping to reduce unemployment both on the reservation and in the surrounding area. Grand Casino Mille Lacs is the first of two casinos to be financed and managed by the company for the Mille Lacs Band.
 Under its management contract, Grand Casinos derives no revenues until the casino is operating profitability, and then shares in 40 percent of the casino's earnings, with the other 60 percent distributed to the tribe. For the period ended Oct. 27, 1991, revenues of $1.6 million resulted in pro forma earnings of $906,000, or 10 cents per share for Grand Casinos.
 The company completed its initial public offering in mid-October 1991; thus, net earnings and earnings per share are reported on a pro forma basis, reflecting 9.1 million shares outstanding. Because the casino did not open until April, comparable income statement numbers are not available for the prior year.
 "We're extremely excited by the response that the state's residents, and many out-of-staters, have accorded our facility," said Lyle Berman, chairman and chief executive officer of Grand Casinos. "It is our goal to provide an enjoyable entertainment experience for all our visitors, and by all indications, we are succeeding."
 Berman noted that the casino's Grand Advantage Players Club, a cash- back program available to the casino's slot patrons, already has enrolled more than 50,000 members.
 "While the casino is off to a very promising start, as we head into the slower winter months, none of us at Grand Casinos or within the Mille Lacs Band intends to rest on our laurels," Berman added. "We are continually analyzing the results of operations and are building our next casino, which is scheduled to open at Hinckley, Minn., in May 1992."
 Reflecting the receipt of more than $12.2 million in proceeds from Grand Casinos' initial public offering in October, the company reported a strong financial position at the close of the first quarter. Shareholders' equity stood at $12.3 million, or $1.19 per share, while total liabilities were just $889,000. The company's current ratio was 6-to-1, with more than $4 million in working capital.
 "As indicated in our prospectus, the company plans to use its capital position to finance the construction and opening of the Hinckley casino," said Thomas Brosig, chief operating officer. "We believe that our existing resources, including cash flow from the Grand Casino Mille Lacs, will be sufficient to build the new, 100,000-square-foot casino."
 Grand Casinos, Inc., develops and manages casino gaming and bingo facilities for Indian tribes on Indian land. The company's common stock is traded on the NASDAQ National Market System under the symbol GRND.
 GRAND CASINOS, INC., AND SUBSIDIARIES
 STATEMENTS OF EARNINGS (Unaudited)
 10/27/91
 Revenues:
 Distributions from
 Grand Casino Mille Lacs $1,561,005
 Costs and expenses:
 Salaries 90,103
 Rent expense 352
 Casino development expenses 33,040
 Travel and entertainment 16,575
 Other general administrative 75,374
 Total costs and expenses 215,444
 Earnings from operations 1,345,561
 Other income (expense):
 Other income 47,669
 Interest income 119,844
 Interest expense (2,746)
 Total other income 164,767
 Net earnings $1,510,328
 Net earnings distributed
 to predecessors 1,455,973
 Net earnings available
 to common shareholders 54,355
 Pro forma data(a)
 Historical net earnings 1,510,328
 Pro forma provision for
 income taxes at 40 percent (604,131)
 Pro forma net earnings $906,197
 Pro forma net earnings
 per common share $.10
 Pro forma common shares
 outstanding 9,096,553
 (a) Although a significant portion of net earnings were earned by predecessors, who are therefore responsible for payment of federal and state income taxes, the unaudited pro forma information accounts for income taxes as if the company had been subject to federal and state income taxes at a combined rate of 40 percent.
 CONSOLIDATED BALANCE SHEETS
 10/27/91 7/28/91
 (Unaudited)
 Assets
 Current assets:
 Cash and cash equivalents $3,722,149 $832,975
 Prepaid insurance 59,277 0
 Current installments of notes receivable 384,108 383,934
 Interest receivable (Hinckley note) 53,559 0
 Distribution receivable
 from casino operations 424,181 871,325
 Start-up costs 341,308 0
 Organizational costs 156,236 0
 Other receivables 21,175 295,310
 Total current assets 5,161,993 2,383,544
 Land held for development 773,136 35,000
 Notes receivable, less
 current installments 6,825,077 2,533,153
 Furniture and equipment net of
 accumulated depreciation of
 $2,712 and $511, respectively 113,765 11,560
 Mille Lacs deferred charge 350,000 0
 -- $13,223,971 $4,963,257
 Liabilities and shareholders' equity
 Current liabilities:
 Accounts payable $211,359 $30,922
 Current installments of obligations
 under capital leases 23,602 --
 Due to shareholders and related parties 596,181 511,129
 Total current liabilities 831,142 542,051
 Long-term liabilities:
 Obligations under capital leases,
 less current installments 58,215 0
 Total liabilities 889,357 542,051
 Shareholders' equity
 Common stock 104,600 15,000
 Additional paid-in capital 12,175,659 0
 Other invested capital 0 2,349,357
 Retained earnings 54,355 2,056,849
 Total shareholders' equity 12,334,614 4,421,206
 -- $13,223,971 $4,963,257
 -0- 12/09/91
 /CONTACT: Michael Rosenbaum of Financial Relations Board, 312-266- 7800, for Grand Casinos/
 (GRND) CO: Grand Casinos, Inc. ST: Minnesota IN: LEI SU: ERN


DS -- MN009 -- 0507 12/09/91 11:26 EST
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Date:Dec 9, 1991
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