Greektown Superholdings 8-K Greektown Superholdings, Inc. Reports Second Quarter 2012 Financial Results

Greektown Superholdings, Inc. 8-K

Exhibit 99.1

FOR IMMEDIATE RELEASE

August 14, 2012

Greektown Superholdings, Inc. Reports Second Quarter 2012 Financial Results

DETROIT, August 14, 2012– Greektown Superholdings, Inc. (“Greektown” or the “company”) today reported financial results for its second quarter ended June 30, 2012. Financial highlights for the second quarter include:

· Net revenues for the three months ended June 30, 2012 were $83.5 million compared to $84.0 million for the same quarter of 2011, a decrease of 0.5%.

· Income from operations for the second quarter increased to $9.9 million compared to $9.3 million a year ago.

· Net loss increased to $6.3 million compared to $3.3 million a year ago. Net loss for the second quarter of 2011 included $3.8 million of deferred income tax benefit related to the repeal of the Michigan Business Tax.

· EBITDA(1) decreased by 5.4%, to $18.4 million in the second quarter of 2012 from $19.5 million in the same quarter of 2011.

“Although we were affected by the softness of the Detroit gaming market in the second quarter, we increased net revenues in both April and May compared to the same periods a year ago,” said Michael Puggi, Greektown’s president and chief executive officer. “In addition, while we believe the opening of casinos in Ohio has negatively affected the Detroit gaming market, the impact has been consistent with our expectations.”

“We will continue to focus on managing expenses and increasing operating efficiencies,” continued Puggi. “At the same time, we are continuing our efforts to improve the guest experience. Construction of our new 850-space valet garage continues on schedule, and is expected to open in the first quarter of 2013. In addition, we are in the process of enhancing our dining offerings, including the addition of a fine-dining restaurant within the casino and a fresh market-style dining venue. Our guests are excited about the changes, and we expect that the property enhancements we’re making will draw new customers to Greektown Casino-Hotel as well.”

Year-To-Date Results

Net revenues for the six months ended June 30, 2012 were $175.4 million compared to $169.4 million for the same period ended of 2011, an increase of 3.5%. Income from operations for the six months ended June 30, 2012 increased to $24.9 million compared to $18.2 million a year ago, and net loss decreased to $7.5 million compared to $11.8 million a year ago. EBITDA(1) increased by 11.7%, to $42.1 million for the six months ended 2012 from $37.7 million in the same period of 2011. Net loss for the six months ended June 30, 2011 included $1.1 million of expense related to Chapter 11 reorganization items.

Cash and cash equivalents were $58.4 million at June 30, 2012, compared to $45.1 million at June 30, 2011, and the company did not borrow against its revolving loan agreement during the first half of 2012. The company paid semiannual interest of approximately $25.0 million on its senior secured notes on July 2, 2012 and July 1, 2011.

(1) EBITDA (earnings before interest, taxes, depreciation and amortization) is a measurement not in accordance with U.S. Generally Accepted Accounting Principles (GAAP) but is commonly used in the gaming industry as a measure of performance and as a basis for valuation of gaming companies. Reconciliation of net loss to EBITDA is attached to this release. EBITDA is a supplemental financial measure used by management, as well as industry analysts, to evaluate our operations. However, EBITDA should not be construed as an alternative to income from operations (as an indicator of our operating performance) or to cash flows from operating activities (as a measure of liquidity) as determined in accordance with GAAP. All companies do not calculate EBITDA in the same manner. As a result, the Company’s EBITDA may not be comparable to similarly titled measures presented by other companies.

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About Greektown Superholdings, Inc.

Greektown Superholdings, Inc. operates, through its subsidiaries, the Greektown Casino-Hotel. Located in the heart of Detroit’s Greektown Dining and Entertainment District, Greektown Casino-Hotel opened on November 10, 2000. Greektown Casino-Hotel offers such amenities as the Eclipz Lounge, Asteria, The Fringe, Shotz Sports Bar & Grill, Bistro 555 and a VIP lounge for players. Greektown Casino-Hotel opened its 400-room hotel tower in February 2009 and recently became the first Michigan casino to debut a smartphone application. For more information, visit greektowncasinohotel.com.

Safe Harbor Statement

Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and may include, but are not limited to, statements about capitalization and performance of Greektown. All forward-looking statements involve risks and uncertainties. All statements contained herein that are not clearly historical in nature are forward-looking, and words such as “anticipate,” “expect,” “will,” “continue,” or other similar words or phrases are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in other press releases, written statements or documents filed with the Securities and Exchange Commission are subject to known and unknown risks, uncertainties and contingencies, including competitive factors (such as the impact of existing and planned casinos in Ohio), as well as the potential ballot initiative to expand the number of commercial casinos within the state of Michigan, and the successful execution of potential financing transactions, and there can be no assurance that the expected benefits of our new projects will be realized. Many of these risks, uncertainties and contingencies are beyond Greektown’s control, and may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Any forward-looking statements in this release speak only as of the date of this release, and Greektown undertakes no obligation to update any forward-looking statement to reflect events or circumstances after that date or to reflect the occurrence of unanticipated events.

Media Contact:

Greektown Superholdings, Inc.

Denise Nasierowski

313-223-2999, ext. 5484

dnasierowski@greektowncasino.com

Investor Contact:

Greektown Superholdings, Inc.

Glen Tomaszewski

Senior Vice President and Chief Financial Officer

313-223-2999, ext. 5467

gtomaszewski@greektowncasino.com

Greektown Superholdings, Inc.

Consolidated Statements of Operations (unaudited)

(In thousands, except share and per share data)

	Three months ended June 30,						Six months ended June 30,
	2012			2011			2012			2011
Revenues
Casino	$	87,861		$	89,616		$	183,229		$	177,919
Food and beverage		5,845			5,782			12,265			11,916
Hotel		3,110			2,740			6,060			5,392
Other		1,361			1,194			2,698			2,494
Gross revenues		98,177			99,332			204,252			197,721
Less promotional allowances		14,646			15,365			28,884			28,277
Net revenues		83,531			83,967			175,368			169,444
Operating expenses
Casino		20,189			19,823			41,430			40,093
Gaming taxes		18,880			19,263			39,444			38,339
Food and beverage		4,007			4,635			8,765			10,250
Hotel		2,493			2,192			5,110			4,630
Marketing, advertising, and entertainment		2,459			1,976			3,794			3,697
Facilities		4,838			4,891			10,107			10,248
Depreciation and amortization		8,548			10,317			17,180			20,587
General and administrative expenses		12,050			11,495			24,390			23,169
Other		166			105			309			186
Operating expenses		73,630			74,697			150,529			151,199
Income from operations		9,901			9,270			24,839			18,245
Other expenses
Interest expense		(12,598	)		(12,631	)		(25,251	)		(25,221	)
Amortization of finance fees		(1,844	)		(1,703	)		(3,681	)		(3,391	)
Other income (expense), net		2			3			57			(9	)
Chapter 11 related reorganization items	—				(95	)	—				(1,149	)
Total other expense, net		(14,440	)		(14,426	)		(28,875	)		(29,770	)
Loss before provisions for state income taxes		(4,539	)		(5,156	)		(4,036	)		(11,525	)
Income tax expense - current		(73	)		(313	)		(146	)		(864	)
Income tax (expense) benefit - deferred		(1,682	)		2,151			(3,364	)		551
Net loss	$	(6,294	)	$	(3,318	)	$	(7,546	)	$	(11,838	)
Loss per share:
Basic	$	(72.49	)	$	(53.90	)	$	(110.64	)	$	(144.88	)
Diluted	$	(72.49	)	$	(53.90	)	$	(110.64	)	$	(144.88	)
Weighted average common shares outstanding		146,028			141,179			145,786			140,957
Weighted average common and common equivalent shares outstanding		146,028			141,179			145,786			140,957

Greektown Superholdings, Inc.

Consolidated Balance Sheets

(In thousands, except share and per share data)

	June 30,			December 31,
	2012			2011
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	58,437		$	50,754
Accounts receivable – gaming, net		695			734
Accounts receivable – other, net		1,169			1,216
Inventories		353			398
Prepaid expenses		6,151			5,605
Prepaid Michigan Gaming Control Board annual fee		3,695			8,823
Prepaid municipal services fees		1,026			3,346
Deposits		1,631			1,631
Total current assets		73,157			72,507
Property, building, and equipment, net		320,996			317,085
Other assets:
Financing fees - net of accumulated amortization		9,972			11,571
Deposits and other assets		30			30
Casino development rights		117,800			117,800
Trade names		26,300			26,300
Rated player relationships - net of accumulated amortization		41,400			48,300
Goodwill		110,252			110,252
Total assets	$	699,907		$	703,845
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable		12,416			15,128
Accrued interest		25,082			25,063
Accrued expenses and other liabilities		10,132			9,631
Total current liabilities		47,630			49,822
Long-term liabilities:
Other accrued income taxes		9,018			8,871
Senior secured notes - net		369,723			367,748
Obligation under capital lease		2,480			2,489
Deferred income taxes		13,458			10,094
Total long-term liabilities		394,679			389,202
Total liabilities		442,309			439,024
Shareholders’ equity (members’ deficit):
Series A-1 preferred stock at $0.01 par value; 1,688,268 shares authorized, 1,463,535 shares issued and outstanding at June 30, 2012 and December 31, 2011		185,396			185,396
Series A-2 preferred stock at $0.01 par value; 645,065 shares authorized, 162,255 shares issued and outstanding at June 30, 2012 and December 31, 2011		20,551			20,551
Series A-1 preferred warrants at $0.01 par value; 202,511 shares issued and outstanding at June 30, 2012 and December 31, 2011		25,651			25,651
Series A-2 preferred warrants at $0.01 par value; 460,587 shares issued and outstanding at June 30, 2012 and December 31, 2011		58,342			58,342
Series A-1 common stock at $0.01 par value; 4,354,935 shares authorized, 146,028 and 142,423 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively		1			1
Series A-2 common stock at $0.01 par value; 645,065 shares authorized, no shares issued		—			—
Additional paid-in capital		13,975			13,652
Accumulated deficit		(46,318	)		(38,772	)
Total shareholders’ equity		257,598			264,821
Total liabilities and shareholders’ equity	$	699,907		$	703,845

Greektown Superholdings, Inc.

Consolidated Statements of Cash Flows (unaudited)

(In thousands)

	Six Months Ended June 30,
	2012			2011
Operating activities
Net loss	$	(7,546	)	$	(11,838	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		17,180			20,587
Amortization of finance fees and accretion of discount on senior notes		3,681			3,391
Chapter 11 related reorganization items		—			1,149
Deferred income taxes		3,364			(551	)
Stock based compensation		323			203
Changes in current assets and liabilities:
Accounts receivable - gaming		39			(78	)
Accounts receivable - other		47			499
Property tax refund receivable		—			3,451
Inventories		45			9
Prepaid expenses		6,902			8,346
Accounts payable		(2,712	)		1,208
Unsecured distribution liability		—			(10,000	)
Accrued interest		19			(101	)
Accrued expenses and other liabilities		945			(975	)
Net cash provided by operating activities before reorganization costs		22,287			15,300
Operating cash flows for reorganization costs		—			(799	)
Net cash provided by operating activities		22,287			14,501
Investing activities
Decrease in restricted cash		—			5,000
Capital expenditures		(14,496	)		(5,051	)
Redemption of certificate of deposit		—			534
Net cash (provided by) used in  investing activities		(14,496	)		483
Financing activities
Financing fees paid		(108	)		(84	)
Net cash used in financing activities		(108	)		(84	)
Net increase in cash and cash equivalents		7,683			14,900
Cash and cash equivalents at beginning of period		50,754			30,195
Cash and cash equivalents at end of period	$	58,437		$	45,095
Supplemental disclosure of cash flow information
Cash paid during the period for interest	$	25,101		$	25,438
Cash paid during the period for income taxes	$	—		$	451

Greektown Superholdings, Inc.

Reconciliation of Net Loss to EBITDA (1)

(In thousands)

	Three months ended June 30,						Six months ended June 30,
	2012			2011			2012			2011
Net loss	$	(6,294	)	$	(3,318	)	$	(7,546	)	$	(11,838	)
Interest expense		14,439			14,331			28,932			28,612
Tax expense (benefit) tax		1,755			(1,838	)		3,510			313
Depreciation and amortization		8,548			10,317			17,180			20,587
EBITDA (1)	$	18,448		$	19,492		$	42,076		$	37,674

(1) EBITDA (earnings before interest, taxes, depreciation and amortization) is a measurement not in accordance with U.S. Generally Accepted Accounting Principles (GAAP) but is commonly used in the gaming industry as a measure of performance and as a basis for valuation of gaming companies. EBITDA is a supplemental financial measure used by management, as well as industry analysts, to evaluate our operations. However, EBITDA should not be construed as an alternative to income from operations (as an indicator of our operating performance) or to cash flows from operating activities (as a measure of liquidity) as determined in accordance with GAAP. All companies do not calculate EBITDA in the same manner. As a result, the Company’s EBITDA may not be comparable to similarly titled measures presented by other companies.