EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACT:
JON S. BENNETT
VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
MAJESTIC STAR CASINO
(702) 388-2224
MAJESTIC STAR CASINO ADJUSTS
THIRD QUARTER 2003 RESULTS
NOVEMBER 18, 2003, LAS VEGAS, NV - The Majestic Star Casino, LLC ("MSC") today
announced adjusted financial results for the three- and nine-month periods ended
September 30, 2003. MSC is a multi-jurisdictional gaming company that directly
owns and operates one dockside gaming facility located in Gary, Indiana
("Majestic Star"), and indirectly owns and operates three Fitzgeralds brand
casinos located in Tunica, Mississippi ("Fitzgeralds Tunica" or with respect to
the operating subsidiary "Barden Mississippi Gaming, LLC"), Black Hawk, Colorado
("Fitzgeralds Black Hawk" or with respect to the operating subsidiary "Barden
Colorado Gaming, LLC") and downtown Las Vegas, Nevada ("Fitzgeralds Las Vegas"
or with respect to the operating subsidiary "Barden Nevada Gaming, LLC"). Unless
indicated otherwise, the "Company" refers to The Majestic Star Casino, LLC and
all of its direct and indirect subsidiaries.
In connection with the closing of the Company's internal financial statements
for the month of October 31, 2003, the Company performed a monitoring level
review of financial results for the period. During this review, it was
determined that the liability for accrued payroll at Majestic Star at September
30, 2003 (which amount is the opening accrual for the month of October 2003) was
understated by approximately $175,000 due to a computational error.
In the Company's press release dated November 12, 2003, the Company excluded
Fitzgeralds Las Vegas from it consolidated results, since Fitzgeralds Las Vegas
is now an unrestricted subsidiary of MSC and is not a guarantor to the $260.0
million 9-1/2% Senior Secured Notes issued on October 7, 2003. Our adjusted
results, as presented below and consistent with our earlier press release
regarding our third quarter 2003 results, will only present the financial
results for MSC and its restricted and guarantor subsidiaries, which includes
Majestic Investor Holdings, LLC, Fitzgeralds Tunica and Fitzgeralds Black Hawk.
Adjusted Financial Results Excluding Fitzgeralds Las Vegas
On a consolidated basis for the three-months ended September 30, 2003, the
Company previously reported net income of $267,000, operating income of $8.3
million and EBITDA of $13.3 million. Adjusted consolidated net income, operating
income and EBITDA for the three-months ended September 30, 2003 was $92,000,
$8.1 million and
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MAJESTIC STAR CASINO ANNOUNCES THIRD QUARTER EARNINGS 2
$13.2 million, respectively. Consolidated net income, operating income and
EBITDA for the three-months ended September 30, 2002 was $2.2 million, $10.3
million and $15.5 million, respectively.
For the nine-months ended September 30, 2003, the Company previously reported
consolidated net income, operating income and EBITDA of $1.8 million, $25.8
million and $40.9 million, respectively. On a consolidated basis, adjusted net
income, operating income and EBITDA was $1.6 million, $25.6 million and $40.7
million, respectively. For the nine-months ended September 30, 2002,
consolidated net income, operating income and EBITDA was $4.6 million, $29.0
million and $44.4 million, respectively. For both the three- and nine-month
periods ended September 30, 2003, the accrued payroll adjustment had no affect
on the consolidated net revenues reported by the Company.
For the three-months ended September 30, 2003, Majestic Star previously reported
net income of $791,000, operating income of $4.4 million and EBITDA of $6.3
million. Adjusted net income, operating income and EBITDA for the three-months
ended September 30, 2003 was $616,000, $4.2 million and $6.2 million,
respectively. Net income, operating income and EBITDA for the three-months ended
September 30, 2002 was $1.2 million, $4.8 million and $7.2 million,
respectively.
For the nine-months ended September 30, 2003, Majestic Star previously reported
net income, operating income and EBITDA of $2.2 million, $13.0 million and $19.0
million, respectively. Adjusted net income, operating income and EBITDA was $2.1
million, $12.9 million and $18.8 million, respectively. For the nine-months
ended September 30, 2002, net income, operating income and EBITDA
was $3.4 million, $14.2 million and $21.1 million, respectively. For both the
three- and nine-month periods ended September 30, 2003, the accrued payroll
adjustment had no affect on the net revenues reported by Majestic Star.
EBITDA is presented solely as a supplemental disclosure because management
believes that it is a widely used measure of operating performance in the gaming
industry, and a principal basis for valuation of gaming companies. Management
uses EBITDA as a measure of the Company's operating performance. Other companies
may calculate EBITDA differently. EBITDA should not be construed as an
alternative to operating income, as an indicator of the Company's operating
performance, or as an alternative to cash flow from operating activities, as a
measure of liquidity, or as any other measure determined in accordance with
generally accepted accounting principles of the United States of America. The
Company has significant uses of cash including capital expenditures, interest
payments, taxes and debt principal repayments, which are not reflected in
EBITDA. A reconciliation of net income to EBITDA is included in this press
release.
This press release includes statements that constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
adjusted, and Section 21E of the Securities Exchange Act of 1934, as adjusted,
and are subject to the safe harbor provisions of those sections and the Private
Securities Litigation Reform Act of 1995. Words such as "believes",
"anticipates", "estimates", "plans", "intends", "expects", "will" or "could"
used in the Company's press releases and reports filed with the Securities and
Exchange Commission are intended to identify forward-looking statements. All
forward-looking statements involve risks and uncertainties. Although the Company
believes its expectations are based upon reasonable assumptions within the
bounds of its current
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MAJESTIC STAR CASINO ANNOUNCES THIRD QUARTER EARNINGS 3
knowledge of its business and operations, there can be no assurances that actual
results will not materially differ from expected results. The Company cautions
that these and similar statements included in this press release and in
previously filed periodic reports are further qualified by important factors
that could cause actual results to differ materially from those in the
forward-looking statements. Such factors include, without limitation: the risk
of the Company's joint venture partner not making its lease payments when due in
connection with the parking facility at Majestic Star; the ability to fund
planned development needs and to service debt from existing operations and from
new financing; increased competition in existing markets or the opening of new
gaming jurisdictions; a decline in the public acceptance of gaming; the
limitation, conditioning or suspension of our gaming licenses; increases in or
new taxes imposed on gaming revenues, admissions and gaming devices; a finding
of unsuitability by regulatory authorities with respect to the Company or its
officers or key employees; loss and/or retirement of key employees; significant
increase in fuel or transportation prices; adverse economic conditions in the
Company's markets; severe and unusual weather in the Company's markets; adverse
results of significant litigation matters; non-renewal of the Company's gaming
licenses from the appropriate governmental authorities; and continuing effects
of terrorist attacks and any future occurrences of terrorist attacks or other
destabilizing events.
For more information on these and other factors, see The Majestic Star Casino,
LLC's and Majestic Investor Holdings, LLC's most recently filed Form 10-Ks. We
caution readers not to place undue reliance on forward-looking statements, which
speak only as of the date hereof. All subsequent written and oral
forward-looking statements attributable to us are expressly qualified in their
entirety by the cautionary statements and factors that may affect future results
contained throughout this press release. The Company undertakes no obligation to
publicly release any revisions to such forward-looking statements to reflect
events or circumstances after the date hereof.
The Majestic Star Casino, LLC and Majestic Investor Holdings, LLC make available
free of charge their annual reports on Form 10-K, quarterly reports on Form
10-Q, current reports on Form 8-K and all amendments to those reports as soon as
reasonably practicable after such material is electronically filed with or
furnished to the Securities and Exchange Commission. In addition, you may obtain
a copy of such filings at www.sec.gov or from the applicable web site,
www.majesticstar.com or www.fitzgeralds.com.
Reconciliation of Net Income to EBITDA
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
2003 2002 2003 2002
--------------- --------------- --------------- ---------------
MAJESTIC STAR (in thousands)
Net income $ 616 $ 1,226 $ 2,051 $ 3,371
Interest expense, net 3,522 3,585 10,561 10,744
Depreciation and amortization 1,983 2,330 5,991 6,892
Loss (gain) on sale of asset - - 126 (9)
Other non-operating expenses 38 38 113 104
--------------- --------------- --------------- ---------------
EBITDA $ 6,159 $ 7,179 $ 18,842 $ 21,102
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TOTAL GUARANTORS
Net income $ 92 $ 2,246 $ 1,597 $ 4,645
Interest expense, net 7,939 8,010 23,787 24,207
Depreciation and amortization 5,076 5,217 15,072 15,395
Loss on sale of asset 5 10 106 -
Other non-operating expenses 47 49 142 142
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EBITDA $ 13,159 $ 15,532 $ 40,704 $ 44,389
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