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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-QSB
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For fiscal quarter ended April 30, 1998
Commission File Number: 0-24846
COLORADO CASINO RESORTS, INC.
(Exact name of Registrant as specified in its Charter)
Texas 84-1303693
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
304 South 8th Street
Suite 201
Colorado Springs, CO 80905
(719) 635-7047
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE EXCHANGE ACT:
Common Stock, $0.001 Par Value
(Title of Class)
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Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date: 38,665,632 shares of common
stock, $0.001 par value per share.
DOCUMENTS INCORPORATED BY REFERENCE:
None.
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<PAGE>
COLORADO CASINO RESORTS, INC. & SUBSIDIARIES
<TABLE>
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INDEX
<S> <C> <C>
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets - (unaudited) for April 30, 1998...... 3
Consolidated Statement of Operations - (unaudited) for
April 30, 1998 and April 30, 1997............................. 4
Consolidated Statements of Cash Flows - (unaudited) for
April 30, 1998 and April 30, 1997............................. 5
Notes to Consolidated Financial Statements........................ 6
Item 2. Management's Discussion and Analysis of Financial Condition
as well as Future Plans....................................... 7
Part II. Other Information
Item 1. Legal Proceedings................................................. 11
Item 2. Changes in Securities............................................. 11
Item 3. Defaults upon Senior Securities................................... 11
Item 4. Submission of Matters to a Vote of Security Holders............... 11
Item 5. Other Information................................................. 11
Item 6. Exhibits and Reports.............................................. 11
Signatures..................................................................... 12
</TABLE>
SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-QSB contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements
refer to events that could occur in the future or may be identified by the use
of words such as "intend," "plan," "believe," "anticipate," correlative words,
and other expressions indicating that future events are contemplated. Such
statements are subject to inherent risks and uncertainties, and actual results
could differ materially from those projected in the forward-looking statements
as a result of certain of the risk factors set forth following and elsewhere in
this Quarterly Report on Form 10-QSB.
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<PAGE>
<TABLE>
<CAPTION>
Colorado Casino Resorts, Inc.
CONSOLIDATED BALANCE SHEETS (Unaudited)
April 30, October 31,
1998 1997
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<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash & cash equivalents ............................... $ 1,378,506 $ 1,962,486
Inventory ............................................. 136,374 182,641
Advances to officers .................................. 162,417 --
Other ................................................. 476,364 567,678
------------
------------
TOTAL CURRENT ASSETS ............................... 2,153,661 2,712,805
------------ ------------
PROPERTY, PLANT & EQUIPMENT
Land .................................................. 16,106,628 16,106,628
Building and improvements ............................. 23,644,286 23,637,572
Furniture, fixtures & equipment ....................... 8,693,870 8,520,407
Accumulated depreciation & amortization ............... (4,422,394) (3,259,534)
------------ ------------
TOTAL PROPERTY, PLANT & EQUIPMENT .................. 44,022,390 45,005,073
------------ ------------
OTHER ASSETS .......................................... 768,557 657,976
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TOTAL ASSETS ....................................... $ 46,944,608 $ 48,375,854
============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued expenses ...................................... 3,183,773 1,827,187
Accrued interest payable, related party ............... 881,748 506,593
Due to officers ....................................... -- 62,745
Current portion, long-term debt ....................... 9,523,732 1,220,964
Current portion, capital lease obligations ............ 739,420 630,425
------------ ------------
TOTAL CURRENT LIABILITIES .......................... 14,328,673 4,247,914
------------ ------------
CONVERTIBLE DEBENTURES, RELATED PARTY ................. 5,516,988 5,516,988
LONG-TERM DEBT, RELATED PARTY ......................... 7,557,583 7,879,324
LONG-TERM DEBT ........................................ 12,193,058 20,851,322
OBLIGATION UNDER CAPITAL LEASE ........................ 1,995,022 2,065,010
------------ ------------
TOTAL LIABILITIES .................................. 41,591,324 40,560,558
------------ ------------
STOCKHOLDERS' EQUITY
Common stock, $0.001 par value, 100,000,000
shares authorized, 38,665,632 and 38,665,632
issued and outstanding, respectively .............. 38,666 38,666
Paid-in capital ....................................... 15,777,125 15,777,125
Retained earnings (accumulated deficit) ............... (10,462,507) (8,000,496)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY ......................... 5,353,284 7,815,296
------------ ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY ........... $ 46,944,608 $ 48,375,854
============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
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<PAGE>
<TABLE>
<CAPTION>
Colorado Casino Resorts, Inc.
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
Six Months Ended Six Months Ended
April 30, April 30,
1998 1997
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<S> <C> <C>
OPERATING REVENUE
Casino ..................................... $ 7,997,166 $ 7,872,728
Hotel & gift shop .......................... 905,905 962,835
Restaurant & bars .......................... 903,719 749,221
Other ...................................... 206,971 --
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TOTAL OPERATING REVENUE ................. 10,013,761 9,584,784
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OPERATING EXPENSES
Casino ..................................... 4,001,507 3,799,218
Hotel & gift shop .......................... 529,407 659,276
Restaurant & bars .......................... 1,290,383 1,168,308
Marketing/General and administrative ....... 3,301,530 3,358,573
Depreciation and amortization .............. 1,096,774 1,290,535
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TOTAL OPERATING EXPENSE ................. 10,219,601 10,275,910
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INCOME (LOSS) FROM OPERATIONS .............. (205,840) (691,126)
------------ ------------
NONOPERATING INCOME (EXPENSE)
Interest expense ........................... 2,256,262 2,616,663
LOSS BEFORE INCOME TAXES ................... (2,462,102) (3,307,789)
------------ ------------
INCOME TAXES ............................... -- --
NET LOSS ................................... $ (2,462,102) $ (3,307,789)
============ ============
NET LOSS PER SHARE ......................... $ (0.0637) $ (0.0932)
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WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING ................ 38,666,000 35,493,000
============ ============
</TABLE>
[THIS SECTION INTENTIONALLY LEFT BLANK]
The accompanying notes are an integral part of these consolidated financial
statements
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<PAGE>
<TABLE>
<CAPTION>
Colorado Casino Resorts, Inc.
CONSOLIDATED STATEMENT OF CASHFLOWS (Unaudited)
Six Months Ended Six Months Ended
April 30, April 30,
1998 1997
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss ................................................... $(2,462,102) $(3,307,961)
Noncash items
Depreciation and amortization ........................ 1,096,774 1,290,535
Amortization of debt issue costs ..................... 288,160 219,500
(Increase) decrease in:
Inventory ............................................ 46,267 (2,398)
Other current assets ................................. 91,314 (6,116)
Other assets ......................................... (532,565) (156,560)
(Decrease) increase in:
Accrued expenses ..................................... 1,356,586 508,252
Interest payable, related party ...................... 375,155 --
----------- -----------
Net cash provided (used) by operating activities 259,589 (1,454,748)
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CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of land, building and equipment ................... (180,177) (1,561,648)
Advances to officers ....................................... (292,662) --
----------- -----------
Net cash provided (used) by investing activities (472,839) (1,561,648)
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CASH FLOWS FROM FINANCING ACTIVITIES
Advances from officers ..................................... 267,500 513,670
Borrowings, long-term debt and capital leases .............. -- 2,617,345
Repayments, long-term debt and capital leases .............. (316,489) (725,653)
Repayments, long-term debt, related party .................. (321,741) --
----------- -----------
Net cash provided (used) by financing activities (370,730) 2,405,362
----------- -----------
INCREASE (DECREASE) IN CASH AND EQUIVALENTS ................ (583,980) (611,034)
----------- -----------
CASH AND EQUIVALENTS, BEGINNING ............................ 1,962,486 2,828,994
----------- -----------
CASH AND EQUIVALENTS, ENDING ............................... $ 1,378,506 $ 2,217,960
=========== ===========
</TABLE>
[THIS SECTION INTENTIONALLY LEFT BLANK]
The accompanying notes are an integral part of these consolidated financial
statements
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<PAGE>
COLORADO CASINO RESORTS, INC. & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A: Summary of Significant Accounting Policies
The Company's accounting policies are outlined in the audited financial
statements included with the Company's most recent 10KSB. There have been no
changes in accounting principles or practices in the current fiscal year.
Note B: Long Term Debt
During the six months ended April 30, 1998, the Company made total repayments of
$638,230, with $316,489 on long-term debt and capital leases and $321,741 on
long-term debt, related party.
Note C: Advances to/from Officers
During the six months ended April 30, 1998, the Company advanced to officers a
total of $292,662. The officers repaid a total of $267,500 to the Company
leaving balance of $162,417 remaining as a receivable to the Company at April
30, 1998.
Note D: Income Taxes
The Company has an estimated deferred tax benefit of $970,000 for the six months
ended April 30, 1998 which has been offset in full by a valuation allowance due
to the availability of a net operating loss carryforwards at April 30, 1998.
[THIS SECTION INTENTIONALLY LEFT BLANK]
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<PAGE>
COLORADO CASINO RESORTS, INC. & SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
PLANS FOR FUTURE OPERATIONS
OVERVIEW AND PLAN OF OPERATION
Colorado Casino Resorts, Inc., ("CCRI" and/or the "Company") is in the business
of developing and operating casino and hotel resort properties. Through its
wholly owned subsidiaries, Creeker's, Inc. and Double Eagle Resorts, Inc., CCRI
is the owner of Creeker's Casino ("Creeker's") and the Double Eagle Hotel &
Casino (the "Double Eagle"), both located in Cripple Creek, Colorado.
During the six months ended April 30, 1998, the Company reported net operating
revenues of $10.01 million, an increase of $429,000, or 4.9% from the $9.58
million reported during the same period in 1997. The Company reported a net loss
of $(2.46) million, or $(0.064) per share, for the six months ended April 30,
1998 compared to a net loss of $(3.31) million, or $(0.093) per share, reported
for the same period last year. Although the Company's business is not considered
to be seasonal, the highest levels of business activity in Colorado occur during
the tourist season (i.e., from May through September). Its base level (i.e.,
November through May) is fairly constant although inclement weather conditions
during this period could have an adverse effect on business levels in Colorado.
Although the Company recorded a net loss, EBITDA (earnings before interest taxes
depreciation and amortization) totaled nearly $891,000, up $292,000 or 48.6%
higher than the $599,000 reported during the same period last year. However, as
a result of the reclassification of the International Game Technology ("IGT")
capital lease to an operating lease, casino operating expenses increased by
approximately $420,000 for the six months ended April 30, 1998. After adjusting
for comparison purposes, EBITDA for the first six months of 1998 should be $1.31
million compared to $599,000 reported in 1997, representing a 118.7% increase.
Business and Marketing Strategy
The Company's business strategy is to offer casino gaming and a full range of
amenities in a friendly atmosphere that caters to middle and upper-middle income
customers. Incorporating the distinction between Creeker's Casino and the Double
Eagle Hotel & Casino in its marketing efforts, management believes it is able to
increase gaming activity at its respective casinos by attracting customers from
two market segments.
Creeker's Casino
Creeker's Casino, resembling a Victorian-style historic structure of the late
1800's, is located at the corner of 3rd Street and Bennett Avenue in the center
of town. Creeker's offers its customers a friendly, "down-to-earth" atmosphere
in which to enjoy gaming activities. Within its 19,000-square foot casino, it
offers 234 slot machines, two blackjack tables, two bars, a restaurant featuring
buffet-style meals, and entertainment areas.
Creeker's targets middle- to upper-income customers from the greater Colorado
Springs area and surrounding communities who prefer to make day trips to Cripple
Creek. Because of its smaller size and "down-to-earth" atmosphere, Creeker's
appeals to many customers who enjoy a cozier environment and the personal touch
offered by its friendly employees. A hearty buffet served in its restaurant
further heightens Creeker's attractiveness to this market segment.
Double Eagle Hotel & Casino
Through the new Double Eagle Hotel & Casino, the Company established the first
major hotel and casino serving the greater Colorado Springs area with a growing
population base, approaching one million. Unlike existing gaming facilities in
the Cripple Creek area, which offer limited or no overnight accommodations,
inconvenient parking and few non-gaming amenities, the Double Eagle features 158
hotel rooms and suites, four parking lots with a total of 650 spaces, free valet
parking and shuttle transportation, and a 45,000-square foot casino offering 657
slot machines and five blackjack tables. The facility also includes a 100-seat
restaurant, Lombard's Bar & Grill, two bars and a gift shop. Located on the
southwest corner of Bennett Avenue and 5th Street, where Route 67 and Bennett
Avenue intersect, the Double Eagle provides superior access and visibility to
motorists entering and exiting the City of Cripple Creek.
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<PAGE>
The Double Eagle appeals to higher income patrons because of its "Las
Vegas-style" casino atmosphere, quality hotel and restaurant facilities and a
variety of special events. With the largest number of rooms and elegant suites
in Cripple Creek, free valet parking under a covered car port, and an exciting
and lively atmosphere, the Double Eagle attracts customers who enjoy spending
multiple days of gaming within a facility which offers the hospitality and
convenience of first-class accommodations.
Effective Marketing and Promotion. The Company's marketing strategy has been to
aggressively promote its two properties to customers in the identified market
segments. Through the use of radio and print advertising, promotional coupons
and special events designed uniquely to address each market segment, management
attracts players to its respective properties. Promotional allowances, such as
complimentary rooms, food, beverage and entertainment are used at both casinos
to reward and retain its customers. Specifically, Creeker's promotes coupons for
free bus transportation, discounts on buffet meals, and cash and prizes while
the Double Eagle offers discounted and complimentary hotel rooms, complimentary
dinners at Lombard's Bar & Grill, and cash sweepstakes to attract respective
customers.
Management of the Double Eagle continues to reinforce its commitment to a high
growth strategy by improving its overall image and effectiveness through new and
innovative marketing programs. During the second quarter, the Company retained
ZLR & Associates, a marketing and advertising agency, to improve the Double
Eagle's advertising and marketing efforts through, among other programs, image
creation, print and broadcast advertising, and a comprehensive direct-mail
campaign. In addition, free daily slot tournaments and live music and
entertainment are expected to attract patrons to the Double Eagle.
Emphasis on Slot Play. Responding to the increased popularity of slot machines
over the past several years and recognizing that most revenues are generated by
slot machines in a limited stakes market, the Company has focused its gaming mix
toward slot, keno, and video poker machines. To maximize capacity utilization,
management chose to reduce the number of slot machines at the Double Eagle,
improving the casino floor layout while increasing payout percentages. The
Company continues to monitor payout percentages of its slot machines to ensure
that they remain competitive.
Increased slot play is also encouraged through the use of the slot club. The
"Winners Circle" slot club and the use of a computerized player tracking system,
which monitors the wagering of its members, provides the Company with
information which assists management in planning and directing its marketing
efforts to its customers. As members of the Winners Circle, patrons are
encouraged to insert their frequent player card into slot, keno, and video poker
machines while playing in the casino to earn points. Using the tracking system
to track wagering, management rewards members of the Winners Circle based on
their point totals with various cash and gift prizes. Currently, Creeker's and
the Double Eagle have a combined total of nearly 75,000 members in their
database.
Customer Service. Management is placing greater emphasis on customer service
through extensive employee training and education programs. These programs are
designed to ensure customers are provided a friendly, safe, and service-driven
environment in which gaming becomes a fun and exciting activity. The Company
plans to retain a professional firm to provide and implement customer training
programs.
Management and Key Personnel. During the second quarter, the Company recruited
Mr. Joseph M. Farruggio, 46, as Vice President of Operations and General Manager
of the Company's Colorado operations. Mr. Farruggio has over twenty years of
gaming experience with the last ten in casino general management. He is
responsible for all day-to-day operations of both the Double Eagle Hotel &
Casino and Creeker's Casino. Drawing upon his extensive experience in casino
operations, Mr. Farruggio is expected to help solidify the Company's competitive
position in the Colorado market.
In addition to improving its operations by recruiting qualified talent for its
management team, the Company seeks to enhance its strategic direction and
overall position through its Board of Directors. During the second quarter and
pending regulatory approval, Mr. Salvatore T. DiMascio, 59, was appointed to the
Company's Board of Directors. Mr. DiMascio has extensive senior level experience
in a variety of industries including finance and gaming. Formerly the Executive
Vice President and Chief Financial Officer of Anchor Gaming, Mr. DiMascio is a
valued addition to the Company's Board.
Management continues to make significant investments in key management and
personnel through benefits packages and bonus programs. Employee benefits, which
include medical, dental and vision plans, in addition to on-the-job training and
advancement opportunities are offered to attract and retain qualified
individuals.
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<PAGE>
Future Plans. Management believes that an integral component of attracting
patrons in Cripple Creek is adequate, nearby parking. During the fourth quarter
of fiscal 1997, the Company acquired control of fifteen contiguous city lots,
comprising approximately 47,000 square feet (one city block), located adjacent
to the Double Eagle in Cripple Creek. This property is currently used for guest
parking, accommodating approximately 250 automobiles. However, the Company is
proceeding with its plans to construct a multi-level parking garage, which will
accommodate approximately 400 automobiles, on this one acre parcel of land
providing convenient and nearby parking for patrons at the Double Eagle.
Although the addition of a convention facility is expected to increase revenues
by capturing meeting and small convention business for the Double Eagle,
management chose to delay its development in order to proceed with the
construction of the parking garage.
During the second quarter, the Company engaged McDonald & Company Securities,
Inc., an investment banking firm which is a member of the New York Stock
Exchange, to advise it on certain financing transactions. In addition to
providing other financial advisory services, McDonald & Co. will initially
provide advice and assistance in refinancing up to $35 million in high-interest
debt. Once complete, management expects that this refinancing will not only
reduce the Company's interest expense but also position the Company to take
advantage of other growth opportunities. Furthermore, the Company is in the
process of securing a revolving credit facility of up to $15 million which will
be used to pay off certain current debt obligations and provide general working
capital.
In keeping with its commitment to maximize shareholder value through expansion
and diversification, management continues to evaluate several opportunities in
other gaming jurisdictions, both domestic and international. During the second
quarter, the Company entered into discussions with RAV Bahamas, Ltd. for the
joint development and ownership of a 510 room hotel and casino complex on the
island of North Bimini, Bahamas. This complex is expected be part of a high
quality, family-oriented "Bimini Bay Destination Resort" currently under
development by RAV Bahamas. The island of North Bimini is part of the
Commonwealth of the Bahamas and is located 48 miles due east from Miami,
Florida. The contemplated hotel and casino is expected to attract a large
portion of the South Florida market, transported to the island by a
300-passenger fast ferry which is capable of making the crossing in
approximately one hour. This joint venture project is subject to signing a
Development Agreement on terms acceptable to the Company.
COMPANY REVENUE
The Company reported net operating revenues for the six months ended April 30,
1998 of $10.01 million, an increase of nearly $429,000, or 4.5% from the $9.58
million reported for the same period in 1997. Casino revenues increased by over
$124,000, up 1.6% from the $7.87 million recorded for the same six-month period
last year to nearly $8.00 million in fiscal 1998. Revenues from the hotel and
gift shop decreased -5.91% to $906,000 from the $963,000 reported for the first
six months ended April 30, 1997. However, restaurant and bar revenues improved
by 20.6%, up almost $155,000 to $904,000 from $749,000 during the first six
months of fiscal 1998.
During the six months, the Company reported nearly $207,000 in other revenues
primarily resulting from parking operations and amusement arcade.
Acquisitions
There were no acquisitions of any significance during this quarter.
Sale of Stock
There was no sale of stock during this quarter.
Results of Operations
The Company reported net operating revenues for the first six months of fiscal
1998 of $10.01 million, an increase of almost $429,000, or 4.5% from the $9.58
million recorded in 1997. Generating approximately 80% of the total revenues,
the Company's casino operations produced revenues of nearly $8.00 million. Total
operating expenses were $10.22 million for the six months ended April 30, 1998,
remaining relatively flat compared to $10.28 million reported for the same
fiscal six months in 1997. Total operating expenses as a percentage of total
revenues decreased to 102.1% from 107.2% recorded in the same period of fiscal
1997.
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<PAGE>
Casino. Casino revenues increased slightly over $124,000, up 1.6% from $7.87
million during the first six months in 1997 to nearly $8.00 million for the same
period in 1998. Costs and expenses of casino operations were $4.00 million for
the six months ended April 30, 1998, an increase of $202,000 or 5.3% from $3.79
million for the same period in fiscal 1997. Casino costs and expenses as a
percentage of casino revenues increased to 50.0% in 1998 from 48.3% during the
same period in 1997. The net increase in casino costs and expenses was primarily
due to the inclusion of the operating lease expense associated with the
reclassification if the IGT slot machine lease.
Hotel and Gift Shop. Revenues from the hotel and gift shop amounted to over
$906,000 for the first six months of 1998, down -5.91% from the $963,000
reported during the same period last year. Hotel and gift shop revenues
accounted for 9.0% of total consolidated revenues. Costs and expenses of hotel
and gift shop operations were over $529,000 for the first six months of 1998, a
decrease of nearly $130,000 or -19.7% from $659,000 reported in 1997. Hotel and
gift shop costs and expenses as a percentage of hotel and gift shop revenues
decreased to 58.4% from 68.5% during the same period in 1997.
Restaurant and Bar. Restaurant and bar revenues improved by 20.6%, up nearly
$155,000 to $904,000 for the six months ended April 30, 1998. Costs and expenses
of restaurant and bars were $1.29 million for the six months in 1998, an
increase of $122,000 or 10.5% from $1.17 million recorded in 1997. Restaurant
and bar costs and expenses as a percentage of restaurant and bar revenues
decreased to 142.8% from 155.9% during the same period in 1997.
Marketing/General and Administrative. Marketing and general and administrative
expenses were $3.30 million for the six months ended April 30, 1998, relatively
flat when compared to the $3.36 million reported for the same period in 1997.
However, marketing and general and administrative expenses as a percentage of
total revenues decreased to 32.9% for the six months in 1998 from 35.0% for the
same period in 1997.
Depreciation. Depreciation was $1.10 million for the six months ended April 30,
1998, a decrease of nearly $194,000 or 15.0% from $1.29 million for the same
fiscal quarter 1997. The decrease in depreciation expense is primarily due to
the to the reclassification of the IGT lease from a capital lease in fiscal 1997
to an operating lease in fiscal 1998.
Income from Operations. As a result of factors discussed above, a loss from
operations of ($206,000) was reported for the six months ended April 30, 1998,
an improvement of over $485,000 or 70.2% from a loss of $(691,000) reported
during the same period in 1997. As a percentage of total revenues, loss from
operations decreased to -2.06% during the six months in fiscal 1998 from a loss
of -7.2% during the same period in 1997.
Interest Expense. Interest expense was $2.26 million for the six months ended
April 30, 1998, an decrease of ($360,000) or -13.8% from $2.62 million recorded
for the same period in 1997. The net reduction in interest expense is primarily
due to the reclassification of the IGT lease from a capital lease in fiscal 1997
to an operating lease in fiscal 1998.
Net Loss. The net loss for the Company was $(2.46) million for the six months
ended April 30, 1998, a decrease of more than $845,000 or 25.6% from a loss of
$(3.31) million reported in the first six months of 1997.
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normally recurring accruals) considered necessary for a fair presentation
have been included.
Operating results for the six months ended April 30, 1998 are not necessarily
indicative of the results that may be expected for the fiscal year ending
October 31, 1998. For further information, refer to the consolidated statements
and footnotes included in the Registrant's annual report on Form 10-KSB for the
year ending October 31, 1997.
**********
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<PAGE>
COLORADO CASINO RESORTS, INC. & SUBSIDIARIES
OTHER INFORMATION
PART II. Other Information
Item 1. Legal Proceedings
The Company is party to various lawsuits relating to routine
matters incidental to its business. Management does not believe
that the outcome of any such litigation, in aggregate, will have
a material adverse effect on the Company.
Item 2. Changes in Securities - None.
Item 3. Defaults Upon Senior Securities - None.
Item 4. Submission of Matters to Vote of Security Holders - None.
Item 5. Other Information - None.
Item 6. Exhibits and Reports - None.
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<PAGE>
COLORADO CASINO RESORTS, INC. & SUBSIDIARIES
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized this 12th day of June,
1998.
COLORADO CASINO RESORTS, INC.
June 12, 1998 By: /s/ Rudy S. Saenz
--------------------
Rudy S. Saenz
President and Chief Executive Officer,
Director (Principal Executive Officer)
June 12, 1998 /s/ Farid E. Tannous
-----------------------
Farid E. Tannous
Treasurer and Chief Financial Officer
(Principal Financial Officer)
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-START> NOV-01-1997
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