Exhibit 99.3
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following unaudited pro forma condensed combined financial statements have been prepared to give effect to the acquisition by Ameristar East Chicago Holdings, LLC, a wholly owned subsidiary of Ameristar Casinos, Inc., of RIH Acquisitions IN, LLC, and are derived from our historical financial statements and the historical financial statements of RIH Acquisitions IN, LLC. The historical financial statements have been adjusted as described in the notes to the unaudited pro forma condensed combined financial statements.
The unaudited pro forma condensed combined financial statements are prepared in accordance with Article 11 of Regulation S-X. For purposes of the unaudited pro forma condensed combined statements of income, we assumed the acquisition occurred on January 1, 2006.
The unaudited pro forma condensed combined financial statements should not be considered representative of our future consolidated results of operations or financial position.
99.3-1
AMERISTAR CASINOS, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Per Share Data)
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Per Share Data)
For the nine months ended September 30, 2007 | ||||||||||||||||
RIH | AMERISTAR | |||||||||||||||
AMERISTAR | ACQUISITIONS | PRO FORMA | CASINOS, INC. | |||||||||||||
CASINOS, INC. | IN, LLC | ADJUSTMENTS | PRO FORMA | |||||||||||||
REVENUES: | ||||||||||||||||
Casino | $ | 776,389 | $ | 234,097 | — | $ | 1,010,486 | |||||||||
Food and beverage | 98,493 | 17,609 | — | 116,102 | ||||||||||||
Rooms | 22,049 | 6,032 | — | 28,081 | ||||||||||||
Other | 22,018 | 4,657 | — | 26,675 | ||||||||||||
918,949 | 262,395 | — | 1,181,344 | |||||||||||||
Less: Promotional allowances | 141,202 | 49,320 | — | 190,522 | ||||||||||||
Net revenues | 777,747 | 213,075 | — | 990,822 | ||||||||||||
OPERATING EXPENSES: | ||||||||||||||||
Casino | 332,353 | 128,370 | — | 460,723 | ||||||||||||
Food and beverage | 51,294 | 4,006 | — | 55,300 | ||||||||||||
Rooms | 5,836 | 384 | — | 6,220 | ||||||||||||
Other | 14,532 | 303 | — | 14,835 | ||||||||||||
Selling, general and administrative | 164,306 | 58,167 | (1,113 | )(a) | 221,360 | |||||||||||
Depreciation and amortization | 70,051 | 3,573 | 4,198 | (b) | 77,822 | |||||||||||
Impairment loss on assets held for sale | 166 | 684 | — | 850 | ||||||||||||
Total operating expenses | 638,538 | 195,487 | 3,085 | 837,110 | ||||||||||||
Income from operations | 139,209 | 17,588 | (3,085 | ) | 153,712 | |||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Interest income | 1,717 | 95 | 1,812 | |||||||||||||
Interest expense, net | (34,914 | ) | (23,843 | ) | (12,058 | )(c) | (70,815 | ) | ||||||||
Net (loss) gain on disposition of assets | (1,305 | ) | (1,305 | ) | ||||||||||||
Other | 11 | — | — | 11 | ||||||||||||
INCOME BEFORE INCOME TAX PROVISION | 104,718 | (6,160 | ) | (15,143 | ) | 83,415 | ||||||||||
Income tax provision | 43,523 | — | (8,854 | )(d) | 34,669 | |||||||||||
NET INCOME | $ | 61,195 | $ | (6,160 | ) | $ | (6,289 | ) | $ | 48,746 | ||||||
EARNINGS PER SHARE: | ||||||||||||||||
Basic | $ | 1.07 | $ | 0.85 | ||||||||||||
Diluted | $ | 1.05 | $ | 0.84 | ||||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING: | ||||||||||||||||
Basic | 57,043 | 57,043 | ||||||||||||||
Diluted | 58,303 | 58,303 | ||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma condensed combined financial statements
99.3-2
AMERISTAR CASINOS, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME
(Amounts in Thousands, Except Per Share Data)
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME
(Amounts in Thousands, Except Per Share Data)
For the year ended December 31, 2006 | ||||||||||||||||
RIH | AMERISTAR | |||||||||||||||
AMERISTAR | ACQUISITIONS | PRO FORMA | CASINOS, INC. | |||||||||||||
CASINOS, INC. | IN, LLC | ADJUSTMENTS | PRO FORMA | |||||||||||||
REVENUES: | ||||||||||||||||
Casino | $ | 1,008,311 | $ | 325,259 | — | $ | 1,333,570 | |||||||||
Food and beverage | 131,795 | 25,388 | — | 157,183 | ||||||||||||
Rooms | 27,972 | 8,048 | — | 36,020 | ||||||||||||
Other | 29,082 | 5,968 | — | 35,050 | ||||||||||||
1,197,160 | 364,663 | — | 1,561,823 | |||||||||||||
Less: Promotional allowances | 196,862 | 68,395 | — | 265,257 | ||||||||||||
Net revenues | 1,000,298 | 296,268 | — | 1,296,566 | ||||||||||||
OPERATING EXPENSES: | ||||||||||||||||
Casino | 439,101 | 182,033 | — | 621,134 | ||||||||||||
Food and beverage | 68,744 | 5,194 | — | 73,938 | ||||||||||||
Rooms | 6,780 | 540 | — | 7,320 | ||||||||||||
Other | 18,749 | 443 | — | 19,192 | ||||||||||||
Selling, general and administrative | 200,588 | 53,277 | (1,113 | )(a) | 252,752 | |||||||||||
Corporate Expense | — | 4,726 | — | 4,726 | ||||||||||||
Depreciation and amortization | 93,889 | 13,322 | (3,361 | )(b) | 103,850 | |||||||||||
Impairment loss on assets held for sale | 931 | 79 | 1,010 | |||||||||||||
Total operating expenses | 828,782 | 259,614 | (4,474 | ) | 1,083,922 | |||||||||||
Income from operations | 171,516 | 36,654 | 4,474 | 212,644 | ||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Interest income | 2,746 | 136 | — | 2,882 | ||||||||||||
Interest expense, net | (50,291 | ) | (6,527 | ) | (45,751 | )(c) | (102,569 | ) | ||||||||
Net (loss) gain on disposition of assets | 683 | — | — | 683 | ||||||||||||
Loss on early retirement of debt | (26,264 | ) | — | — | (26,264 | ) | ||||||||||
INCOME BEFORE INCOME TAX PROVISION | 98,390 | 30,263 | (41,277 | ) | 87,376 | |||||||||||
Income tax provision | 38,825 | — | (4,346 | )(d) | 34,479 | |||||||||||
NET INCOME | $ | 59,565 | $ | 30,263 | $ | (36,931 | ) | $ | 52,897 | |||||||
EARNINGS PER SHARE: | ||||||||||||||||
Basic | $ | 1.06 | $ | 0.94 | ||||||||||||
Diluted | $ | 1.04 | $ | 0.92 | ||||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING: | ||||||||||||||||
Basic | 56,155 | 56,155 | ||||||||||||||
Diluted | 57,327 | 57,327 | ||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma condensed combined financial statements
99.3-3
AMERISTAR CASINOS, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007
1. Basis of Presentation
The accompanying unaudited pro forma condensed combined financial statements present the pro forma results of operations and financial position of Ameristar Casinos, Inc. and RIH Acquisitions IN, LLC on a combined basis based on historical financial information of each company and after giving effect to the acquisition of RIH Acquisitions IN, LLC by a wholly owned subsidiary of Ameristar Casinos, Inc. The acquisition will be recorded using the purchase method of accounting, with Ameristar Casinos, Inc. as the acquirer.
For purposes of the unaudited pro forma condensed combined statements of income, we assumed the acquisition occurred on January 1, 2006.
2. Pro Forma Adjustments
The following are brief descriptions of each of the pro forma adjustments included in the unaudited pro forma condensed combined financial statements:
(a) To reflect the one time acquisition and rebranding costs that have been incurred by Ameristar Casinos, Inc. and RIH Acquisitions IN, LLC.
(b) To reflect adjustments to depreciation and amortization related to the recognition of depreciable property and equipment at fair value and the recognition of definite-lived intangible assets in the preliminary purchase price allocation.
(c) To reflect pro forma interest expense resulting from the acquisition. The pro forma interest expense reflects the interest on incremental borrowing associated with the RIH Acquisitions IN, LLC property. An increase of 100 basis points in the average LIBOR rate would increase the Company’s annual interest cost by approximately $16 million.
(d) To reflect the tax effect of the pro forma adjustments on the condensed combined statements of income.
99.3-4