Exhibit 99.1
FOR IMMEDIATE RELEASE | | For further information, call: |
| | Timothy R. Horne, Sr. Vice President-Finance |
Dover, Delaware, April 29, 2004 | | (302) 857-3292 |
DOVER DOWNS GAMING & ENTERTAINMENT, INC. REPORTS RESULTS
FOR THE FIRST QUARTER ENDED MARCH 31, 2004
Dover Downs Gaming & Entertainment, Inc. (NYSE-Symbol: DDE) today reported results for the three months ended March 31, 2004.
The Company’s gross revenues increased 15.0% to $55,597,000 compared with $48,355,000 for the first quarter of 2003. Gaming revenues, which include video lottery win and harness racing commissions, increased 13.8% or $5,752,000 entirely as a result of increased video lottery win compared with the first quarter of 2003.
The Company noted that the 15.4% growth in slot win is the largest quarterly increase since the first quarter of 2000.
Other operating revenues increased to $8,288,000 in the quarter. Occupancy levels in the Dover Downs Hotel and Conference Center remained strong, averaging almost 93% for the first quarter.
Net earnings were $4,434,000 or $.17 per diluted share compared with $4,007,000 or $.15 per diluted share for the first quarter of 2003.
The Company’s previously announced construction and renovation projects were recently completed. During the quarter, the casino floor was expanded to 91,000 square feet to allow for the addition of 500 slot machines, bringing the total number of machines to 2,500 at March 31, 2004. In April of 2004, several climate controlled smoking areas were completed, and the Company’s new slot data system was installed.
Denis McGlynn, President and CEO of Dover Downs Gaming & Entertainment, Inc. stated, “ We are very happy about the return to growth we experienced in the first quarter. We hope to continue this trend as we should benefit more fully from the 500-slot machine expansion and our new slot data system, both of which were added throughout the first quarter.”
The Company’s financial position remained strong, as amounts outstanding pursuant to the Company’s revolving credit facility were reduced to $29,775,000 at March 31, 2004.
The Company announced yesterday that it has increased its quarterly dividend by 20% to $.06 per share. The dividend is payable on June 10, 2004 to shareholders of record at the close of business on May 10, 2004.
* * *
This release contains or may contain forward-looking statements based on management’s beliefs and assumptions. Such statements are subject to various risks and uncertainties that could cause results to vary materially. Please refer to the Company’s SEC filings for a discussion of such factors.
Dover Downs Gaming & Entertainment, Inc. is a diversified gaming and entertainment company whose operations consist of Dover Downs Slots – a 91,000-square foot video lottery (slots) casino complex; the Dover Downs Hotel and Conference Center – featuring luxury accommodations with conference, banquet, fine dining, ballroom and concert hall facilities; and Dover Downs Raceway – a harness racing track with pari-mutuel wagering on live and simulcast horse races.
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DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENT OF EARNINGS
In Thousands, Except Per Share Amounts
(Unaudited)
| | Three Months Ended
March 31, | |
| | 2004 | | 2003 | |
Revenues: | | | | | |
Gaming(1) | | $ | 47,309 | | $ | 41,557 | |
Other operating | | 8,288 | | 6,798 | |
Gross revenues | | 55,597 | | 48,355 | |
Less - promotional allowances | | 5,037 | | 4,156 | |
| | 50,560 | | 44,199 | |
| | | | | |
Expenses: | | | | | |
Gaming | | 37,652 | | 32,521 | |
Other operating | | 2,441 | | 2,254 | |
General and administrative | | 1,147 | | 954 | |
Depreciation | | 1,691 | | 1,502 | |
| | 42,931 | | 37,231 | |
| | | | | |
Operating earnings | | 7,629 | | 6,968 | |
| | | | | |
Interest expense | | 153 | | 214 | |
| | | | | |
Earnings before income taxes | | 7,476 | | 6,754 | |
| | | | | |
Income taxes | | 3,042 | | 2,747 | |
| | | | | |
Net earnings | | $ | 4,434 | | $ | 4,007 | |
| | | | | |
Net earnings per common share: | | | | | |
- Basic | | $ | 0.17 | | $ | 0.15 | |
- Diluted | | $ | 0.17 | | $ | 0.15 | |
| | | | | |
Average shares outstanding: | | | | | |
- Basic | | 26,478 | | 26,579 | |
- Diluted | | 26,545 | | 26,605 | |
(1) | Gaming revenues from the Company’s video lottery (slot) machine operations include the total win from such operations. The Delaware State Lottery Office collects the win and remits a portion thereof to the Company as its commission for acting as a Licensed Agent. The difference between total win and the amount remitted to the Company is reflected in gaming expenses. |
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DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED BALANCE SHEET
In Thousands
(Unaudited)
| | March 31, | | December 31, | |
| | 2004 | | 2003 | |
ASSETS | | | | | |
| | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 15,859 | | $ | 14,138 | |
Accounts receivable | | 3,696 | | 1,914 | |
Due from State of Delaware | | 3,328 | | 8,670 | |
Inventories | | 1,875 | | 1,801 | |
Prepaid expenses and other | | 1,335 | | 2,414 | |
Receivable from Dover Motorsports, Inc. | | 3 | | - | |
Deferred income taxes | | 786 | | 878 | |
Total current assets | | 26,882 | | 29,815 | |
| | | | | |
Property and equipment, net | | 123,553 | | 122,344 | |
Total assets | | $ | 150,435 | | $ | 152,159 | |
| | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | |
| | | | | |
Current liabilities: | | | | | |
Accounts payable | | $ | 6,105 | | $ | 6,516 | |
Purses due horsemen | | 3,213 | | 7,957 | |
Accrued liabilities | | 5,332 | | 6,015 | |
Payable to Dover Motorsports, Inc. | | - | | 96 | |
Income taxes payable | | 2,194 | | 53 | |
Deferred revenue | | 240 | | 261 | |
Total current liabilities | | 17,084 | | 20,898 | |
| | | | | |
Notes payable to banks | | 29,775 | | 31,225 | |
Deferred income taxes | | 5,492 | | 5,061 | |
| | | | | |
Stockholders’ equity: | | | | | |
Common stock | | 1,033 | | 1,033 | |
Class A common stock | | 1,615 | | 1,615 | |
Additional paid-in capital | | 67,454 | | 67,454 | |
Retained earnings | | 27,982 | | 24,873 | |
Total stockholders’ equity | | 98,084 | | 94,975 | |
Total liabilities and stockholders’ equity | | $ | 150,435 | | $ | 152,159 | |
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DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
In Thousands
(Unaudited)
| | Three Months Ended
March 31, | |
| | 2004 | | 2003 | |
| | | | | |
Operating activities: | | | | | |
Net earnings | | $ | 4,434 | | $ | 4,007 | |
Adjustments to reconcile net earnings to net cash provided by operating activities: | | | | | |
Depreciation | | 1,691 | | 1,502 | |
Amortization of credit facility origination fees | | 13 | | - | |
Deferred income taxes | | 193 | | 192 | |
Changes in assets and liabilities: | | | | | |
Accounts receivable | | (1,782 | ) | (677 | ) |
Due from State of Delaware | | 5,342 | | 5,502 | |
Inventories | | (74 | ) | (23 | ) |
Prepaid expenses and other | | 1,066 | | 623 | |
Receivable from/payable to Dover Motorsports, Inc. | | (99 | ) | (697 | ) |
Accounts payable | | (411 | ) | 1,427 | |
Purses due horsemen | | (4,744 | ) | (4,922 | ) |
Accrued liabilities | | (683 | ) | (698 | ) |
Income taxes payable | | 2,471 | | 3,242 | |
Deferred revenue | | (21 | ) | 58 | |
Net cash provided by operating activities | | 7,396 | | 9,536 | |
| | | | | |
Investing activities: | | | | | |
Capital expenditures | | (2,900 | ) | (892 | ) |
Net cash used in investing activities | | (2,900 | ) | (892 | ) |
| | | | | |
Financing activities: | | | | | |
Repayments of revolving debt, net | | (1,450 | ) | (3,190 | ) |
Dividends paid | | (1,325 | ) | (1,330 | ) |
Repurchase of common stock | | - | | (1,174 | ) |
Net cash used in financing activities | | (2,775 | ) | (5,694 | ) |
| | | | | |
Net increase in cash and cash equivalents | | 1,721 | | 2,950 | |
Cash and cash equivalents, beginning of period | | 14,138 | | 12,836 | |
Cash and cash equivalents, end of period | | $ | 15,859 | | $ | 15,786 | |
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