EXHIBIT 99.2
NEWS RELEASE
[LAKES ENTERTAINMENT, INC. LOGO] LAKES ENTERTAINMENT, INC.
130 CHESHIRE LANE
MINNETONKA, MN 55305
952-449-9092
952-449-9353 (fax)
WWW.LAKESENTERTAINMENT.COM
TRADED: NASDAQ "LACO"
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FOR FURTHER INFORMATION CONTACT:
Timothy J. Cope 952-449-7030
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FOR IMMEDIATE RELEASE:
Friday, October 24, 2003
LAKES ENTERTAINMENT, INC. ANNOUNCES RESULTS FOR
THIRD QUARTER 2003
MINNEAPOLIS, OCTOBER 24, 2003 -- LAKES ENTERTAINMENT, INC. (NASDAQ "LACO") today
announced results for the third quarter ended September 28, 2003. Net loss for
the quarter was $1.3 million and basic and diluted losses were $0.12 per share.
This compares with a net loss of $1.7 million and basic and diluted losses of
$0.16 per share for the quarter ended September 29, 2002. Revenue for the
quarter totaled $0.4 million. No revenues were recognized during the prior year
period.
Revenues for the current year quarter were derived from license fees related to
the 2003 World Poker Tour (WPT) series which has now completed its first full
season on the Travel Channel, LLC, (TRV). In August of 2003, WPT, a subsidiary
company of Lakes, made an agreement with TRV granting TRV the exclusive right to
broadcast the second season of the WPT series within the United States. The new
agreement also provides TRV with consecutive, exclusive options to broadcast
five additional seasons of the program. WPT will receive a series of fixed
license payments from TRV for the second season. These payments will commence in
2004 and are subject to satisfaction of production milestones and other
conditions. No revenue related to WPT is expected to be recognized during the
remainder of 2003. Revenue from the second season, along with related production
costs, will be recognized in 2004.
Selling, general and administrative expenses remained nearly constant at $2.5
million for the three months ended September 28, 2003 compared to $2.7 million
for the three months ended September 29, 2002.
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Lyle Berman, Chairman and CEO of Lakes, stated, "We are extremely pleased with
the agreement with TRV for a second season of the World Poker Tour series which
was reached during the third quarter. We are also very excited about the
continued and growing popularity of the World Poker Tour Series. We anticipate
that this new arrangement with the TRV along with other potential revenue
opportunities puts the project in a position to be self-sufficient and
profitable in future years." Berman continued, "Our cash balance increased
significantly during the third quarter of 2003 as we received cash in the amount
of $16.0 million at the time of the sale of the Shark Club property in Las
Vegas, Nevada. This cash will be used to continue funding development of our
Native American-owned casino projects. Our focus continues to be on the
successful development of our Native American-owned casino projects and we are
hopeful that construction on one or more of the projects can begin as soon as
early 2004."
Lakes Entertainment, Inc. currently has development and management agreements
with four separate Tribes for four new casino operations, one in Michigan, two
in California and one with the Nipmuc Nation on the East Coast. Lakes
Entertainment also has agreements for the development of one additional casino
on Indian-owned land in California through a joint venture with MRD Gaming,
which is currently being disputed by the Tribe. Additionally, the Company owns
approximately 80% of World Poker Tour, LLC, a joint venture formed to film and
produce poker tournaments for television broadcast.
Lakes Entertainment, Inc. common shares are traded on the Nasdaq National Market
under the trading symbol "LACO".
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The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Certain information included in this press
release (as well as information included in oral statements or other written
statements made or to be made by Lakes Entertainment, Inc.) contains statements
that are forward-looking, such as statements relating to plans for future
expansion and other business development activities as well as other capital
spending, financing sources and the effects of regulation (including gaming and
tax regulation) and competition. Such forward-looking information involves
important risks and uncertainties that could significantly affect anticipated
results in the future and, accordingly, such results may differ from those
expressed in any forward-looking statements made by or on behalf of the Company.
These risks and uncertainties include, but are not limited to, possible delays
in completion of Lakes' casino projects, including various regulatory approvals
and numerous other conditions which must be satisfied before completion of these
projects; possible termination or adverse modification of management contracts;
continued indemnification obligations to Grand Casinos; highly competitive
industry; possible changes in regulations; reliance on continued positive
relationships with Indian tribes and repayment of amounts owned to Lakes by
Indian tribes; possible need for future financing to meet Lakes' expansion
goals; risks of entry into new businesses; and reliance on Lakes' management.
For more information, review the Company's filings with the Securities and
Exchange Commission.
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LAKES ENTERTAINMENT, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(UNAUDITED)
SEPTEMBER 28, 2003 DECEMBER 29, 2002
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Assets
Current Assets:
Cash and cash equivalents $31,292 $14,106
Accounts receivable, net 610 116
Deferred tax asset 2,640 6,771
Other current assets 961 547
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Total Current Assets 35,503 21,540
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Property and Equipment-Net 6,598 6,962
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Other Assets:
Land held under contract for sale 4,967 28,832
Land held for development 14,375 27,791
Notes receivable-less current installments 80,360 70,955
Cash and cash equivalents-restricted - 8,300
Investments in and notes from unconsolidated affiliates 8,597 1,013
Deferred tax asset 6,125 3,835
Other long-term assets 8,927 6,657
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Total Other Assets 123,351 147,383
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TOTAL ASSETS $165,452 $175,885
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $178 $226
Income taxes payable 2,941 5,564
Litigation and claims accrual 148 5,847
Accrued payroll and related 603 252
Other accrued expenses 2,895 3,486
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Total Current Liabilities 6,765 15,375
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TOTAL LIABILITIES 6,765 15,375
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COMMITMENTS AND CONTINGENCIES
Shareholders' Equity:
Capital stock, $.01 par value; authorized 100,000 shares; 10,640 and 10,638
common shares issued and outstanding
at September 28, 2003, and December 29, 2002, respectively 106 106
Additional paid-in-capital 131,542 131,525
Retained Earnings 27,039 28,879
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Total Shareholders' Equity 158,687 160,510
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $165,452 $175,885
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LAKES ENTERTAINMENT, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF LOSSES
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
(UNAUDITED)
THREE MONTHS ENDED
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SEPTEMBER 28, 2003 SEPTEMBER 29, 2002
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Revenues:
License fee income $377 $ -
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Total Revenues 377 -
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COSTS AND EXPENSES:
Selling, general and administrative 2,504 2,700
Depreciation and amortization 135 130
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Total Costs and Expenses 2,639 2,830
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LOSS FROM OPERATIONS (2,262) (2,830)
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OTHER INCOME (EXPENSE):
Interest income 98 134
Interest expense - (23)
Equity in loss of unconsolidated affiliates (50) (85)
Other - -
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Total other income, net 48 26
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Loss before income taxes (2,214) (2,804)
Benefit for income taxes (912) (1,150)
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NET LOSS ($1,302) ($1,654)
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BASIC LOSS PER SHARE ($0.12) ($0.16)
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Diluted Loss per Share ($0.12) ($0.16)
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Weighted Average Common Shares Outstanding 10,639 10,638
Dilutive Effect of Stock Compensation Programs - -
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Weighted Average Common and Diluted
Shares Outstanding 10,639 10,638
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LAKES ENTERTAINMENT, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF LOSSES
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
(UNAUDITED)
NINE MONTHS ENDED
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SEPTEMBER 28, 2003 SEPTEMBER 29, 2002
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Revenues:
Management fee income $ - $1,502
License fee income 3,881 -
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Total Revenues 3,881 1,502
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COSTS AND EXPENSES:
Selling, general and administrative 7,221 14,371
Depreciation and amortization 394 349
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Total Costs and Expenses 7,615 14,720
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LOSS FROM OPERATIONS (3,734) (13,218)
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OTHER INCOME (EXPENSE):
Interest income 649 1,306
Interest expense - (70)
Equity in loss of unconsolidated affiliates (197) (316)
Other 158 -
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Total other income, net 610 920
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Loss before income taxes (3,124) (12,298)
Benefit for income taxes (1,284) (3,401)
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NET LOSS ($1,840) ($8,897)
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BASIC LOSS PER SHARE ($0.17) ($0.84)
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Diluted Loss per Share ($0.17) ($0.84)
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Weighted Average Common Shares Outstanding 10,639 10,638
Dilutive Effect of Stock Compensation Programs - -
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Weighted Average Common and Diluted
Shares Outstanding 10,639 10,638
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