UNION PLAZA HOTEL AND CASINO, INC.
1 Main Street
Las Vegas, NV 89101
August 13, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
Pursuant to the requirements of the Securities Exchange Act of 1934, we are
transmitting herewith the attached Form 10-Q.
Sincerely,
UNION PLAZA HOTEL AND CASINO, INC.
Larry Dolesh, Vice President
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
Commission file number 0-8133
UNION PLAZA HOTEL AND CASINO INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0110085
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
No. 1 Main Street 89125
Las Vegas, Nevada (Zip Code)
(Address of principal
executive offices)
(702) 386-2110
(Registrant's telephone number, including area code)
Indicate by check mark 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
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 close of the period covered by
this report:
Outstanding at
Class of Common Stock June 30, 1999
$.50 par value 757,419 shares
<PAGE>
The Securities and Exchange Commission
Washington D.C.
The financial information included herein is unaudited. In
addition, the financial information does not include all
disclosures required under generally accepted accounting
principles because certain note information included in the
Company's annual report has been omitted; however, such
information reflects all adjustments (consisting entirely of normal
recurring adjustments) which are, in the opinion of Management,
necessary to a fair statement of the results for the interim
period.
/s/ LARRY DOLESH
Larry Dolesh, Vice President of Finance
Las Vegas, Nevada
August 13, 1999
<PAGE>
PART 1. - Financial Information
Item 1. Financial Statements
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
JUNE 30, 1999 AND DECEMBER 31, 1998
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
[CAPTION]
JUNE 30, 1999 AND DECEMBER 31, 1998
ASSETS
JUNE 30, DECEMBER 31,
1999 1998
[S] [C] [C]
Current Assets:
Cash $ 2,542,000 $ 3,228,000
Accounts receivable 817,000 809,000
Inventories of food, beverage
and supplies 369,000 283,000
Prepaid expense 1,010,000 999,000
Total current assets 4,738,000 5,319,000
Property and equipment:
Land 7,012,000 7,012,000
Buildings 56,968,000 56,854,000
Leasehold improvements 3,514,000 3,514,000
Furniture and equipment 36,263,000 33,950,000
103,757,000 101,330,000
Less accumulated depreciation
and amortization 67,661,000 66,064,000
Net property and equipment 36,096,000 35,266,000
Other assets 760,000 954,000
$ 41,594,000 $ 41,539,000
The accompanying notes are an integral
part of these financial statements.
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
JUNE 30, DECEMBER 31,
1999 1998
[S] [C] [C]
Current liabilites:
Accounts payable $ 3,855,000 $ 2,472,000
Accrued liabilities 1,777,000 2,162,000
Current portion of long-term debt 7,106,000 7,106,000
Current portion of obligations under
capital leases 937,000 937,000
Total current liabilities 13,675,000 12,677,000
Long-term debt, less current portion 19,294,000 18,394,000
Obligations under capital leases, less
current portion 1,318,000 1,770,000
Deferred income taxes 394,000 394,000
34,681,000 33,235,000
Commitments and contingencies
Stockholders' equity:
Common stock, $.50 par value; authorized
20,000,000 shares; issued 1,500,000
shares; Outstanding 757,419 shares at
December 31, 1998 and 757,419 shares
at June 30, 1999. 750,000 750,000
Additional paid-in capital 5,462,000 5,462,000
Retained earnings 14,598,000 15,989,000
20,810,000 22,201,000
Less treasury stock, at cost, 742,581
shares at December 31, 1998 and 742,581
shares at June 30, 1999. 13,897,000 13,897,000
Total stockholders' equity 6,913,000 8,304,000
$41,594,000 $41,539,000
The accompanying notes are an integral
part of these financial statements.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
[CAPTION]
SIX AND THREE MONTHS ENDED JUNE 30, 1999 AND 1998
Amounts in thousands except per share data
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
1999 1998 1999 1998
[S] [C] [C] [C] [C]
Revenues:
Casino $ 17,361 $16,700 $ 8,822 $ 7,719
Food and Beverage 5,115 4,991 2,459 2,394
Rooms 5,684 5,464 2,651 2,612
Other 1,129 1,049 502 509
Gross revenues 29,289 28,204 14,434 13,234
Less promotional complimentaries 3,840 4,045 1,702 1,900
Net revenues 25,449 24,159 12,732 11,334
Operating expenses:
Casino 7,492 7,399 3,850 3,738
Food and Beverage 7,594 7,333 3,842 3,640
Rooms 2,972 2,861 1,551 1,425
General & Administrative 2,064 1,927 1,001 869
Entertainment 232 247 113 126
Advertising & Promotion 96 109 66 104
Utilities & Maintenance 2,886 2,660 1,542 1,406
Depreciation & Amortization 1,598 1,911 799 951
Provisions for Doubtful Accts. 21 21 7 11
Other Costs and Expenses 721 663 369 326
Total operating expenses 25,676 25,131 13,140 12,596
Operating income/(loss) (227) (972) (408) (1,262)
Other income (expense):
Interest Income 1 4 0 3
Interest Expense (1,165) (1,112) (583) (556)
Total other income (expense) (1,164) (1,108) (583) (553)
Income before income taxes (1,391) (2,080) (991) (1,815)
Income taxes 0 (213) 0 (123)
Net income/(loss) (1,391) (1,867) (991) (1,692)
Earnings/(loss) per common share ($1.84) ($2.46) ($1.31) ($2.23)
The accompanying notes are an integral
part of these financial statements.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THREE MONTHS ENDED JUNE 30, 1999 AND 1998
INCREASE IN CASH AND CASH EQUIVALENTS
1999 1998
[S] [C] [C]
Cash flows from operating activities:
Cash received from customers $ 25,409,000 $ 24,609,000
Cash paid to suppliers and employees (22,952,000) (24,589,000)
Interest received 1,000 4,000
Interest paid (1,165,000) (1,112,000)
Net cash provided by operating activities 1,293,000 (1,088,000
Cash flows from investing activities:
Proceeds from sale of property & equipment 15,000 2,000
Purchase of property and equipment (2,442,000) (203,000)
Net cash used in investing activities (2,427,000) (201,000)
Cash flows from financing activities:
Proceeds from note payable to Stockholder 900,000 500,000
Principal payments on capital lease (452,000) (394,000)
Principal payments on long-term debt 0 (40,000)
Purchase of Treasury Stock 0 (25,000)
Net cash used in financing activities 448,000 41,000
Net increase (decrease) in cash and
cash equivalents (686,000) (1,248,000)
Cash and cash equivalents
at 12/31/98 & 12/31/97 3,228,000 3,135,000
Cash and cash equivalents,
at 06/30/99 & 06/30/98 2,542,000 1,887,000
RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY OPERATING
ACTIVITIES
Net income(loss) for period ended
06/30/99 and 06/30/98 $ (1,391,000) $ (1,867,000)
Adjustments to reconcile net income to
Net cash provided by operating activities:
Depreciation and amortization 1,616,000 1,929,000
Gain on sale of assets 15,000 (7,000)
(Increase) decrease in assets:
Accounts receivable (8,000) 648,000
Inventories (86,000) (146,000)
Prepaid expenses (11,000) (126,000)
Other assets 160,000 (109,000)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses 998,000 (1,197,000)
Deferred Income Tax 0 (213,000)
Total adjustments 2,684,000 779,000
Net cash provided (used) by operating
activities $ 1,293,000 $ (1,088,000)
The accompanying notes are an integral
part of these financial statements.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The accompanying consolidated financial statements include
the accounts of Union Plaza Hotel and Casino, Inc. (the Company)
and its wholly-owned subsidiaries. All material inter-company
balances and transactions have been eliminated in consolidation.
Nature of the Operations and Basis of Accounting
The Company's wholly-owned subsidiary, Union Plaza Operating
Company, operates hotel and gaming operations in downtown Las
Vegas, Nevada. A substantial portion of the operating revenues
of the Company's subsidiary is derived from gaming operations
which are subject to extensive regulations in the State of Nevada
by the Gaming Commission, the Gaming Control Board and local
regulatory agencies. The Company does not anticipate any material
changes in which the financial results are reported due to the
adoption of new or proposed accounting pronouncements.
In 1994, the Company organized Union Plaza Experience, Inc.
as a wholly owned subsidiary to participate with other downtown
Las Vegas casino enterprises and the City of Las Vegas
Redevelopment Agency, in a redevelopment project known as the
Fremont Street Experience. Investment at December 31, 1998 was
zero as the Company withdrew from the Fremont Street Experience
and has been released of all liability. The Company has
no other materially important subsidiaries or operations.
Management believes that the Company's procedures for
supervising casino operations, recording casino and other
revenues and for granting credit comply in all material respects
with applicable regulations.
Casino Receivables and Revenue
Credit is extended to certain casino customers and the
Company records all unpaid advances as casino receivables on the
date credit was granted. Allowances for estimated uncollectable
casino receivables are provided to reduce the receivables to
amounts anticipated to be collected. The Company recognizes as
casino revenue the net win (which is the difference between
amounts wagered and amounts paid to winning patrons) from gaming
activities.
Promotional Allowances
Gross revenues include the retail value of complimentary
food and beverage and hotel services furnished to customers. The
retail value of these promotional allowances is deducted to
arrive at net revenues.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Property and Equipment
Property and equipment are stated at cost. Expenditures for
additions, renewals and betterments are capitalized; expenditures
for maintenance and repairs are charged to expenses as incurred.
Upon retirement or disposal of assets, the cost and accumulated
depreciation are eliminated from the accounts and the resulting
gain or loss is included in income. Depreciation, including
amortization of a capitalized lease, is computed using the
straight-line method. Leasehold improvements (distinguished from
unamortized leasehold costs) are amortized over the lives of the
leases.
Property and equipment, including capitalized leases, are
depreciated over their estimated useful lives of 3 to 20 years
for land improvements, 20 to 40 years for buildings, 5 to 30
years for leasehold improvements and 3 to 10 years for furniture
and equipment.
Other Assets
Leasehold costs are being amortized on a straight-line basis
over the initial 30-year term of the lease. Expansion of gaming
rights is being amortized on a straight line basis over 20 years.
Subordination of security interest in lease is being amortized on
a straight-line basis over 15 years.
Progressive Slot Liability
The Company has installed a number of progressive slot
machines. As coins are played the amount available to win
increases and will be paid out when the appropriate jackpot is
hit. In accordance with common industry practice, the Company
has recorded the liability and has charged this amount against
casino revenue.
Earnings Per Common Share
Earnings per common share was computed by dividing net
income by the weighted average number of shares of common stock
outstanding during each period.
Inventories
Inventories are valued at the lower of cost, (first-in,
first-out) or market. Maintenance and other operating supplies
are stated at estimated amounts considered by management to be
necessary to conduct full operations. Subsequent replacements
are charged to expense.
Income Taxes
The Company and its subsidiaries file a consolidated Federal
Income Tax return. Deferred income taxes are provided to reflect
the tax effect of timing differences between financial and tax
reporting, principally related to depreciation, slot machine
revenue, interest costs, accrued expenses, capitalization of
leases, capitalization of property costs and write-down of
facilities and other investments to estimated recoverable value.
The Company accounts for the investment tax credit as a
reduction of income tax expense in the year in which such credits
are utilized. Carryforwards of this credit, as well as the tax
effect of net operating loss carryforwards, are shown as a
reduction to deferred income taxes.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Statement of Cash Flows
The Statements of Cash Flows classify changes in cash and
cash equivalents according to operating, investing and financing
activities. For purposes of the statement of cash flows, the
Company considers all highly liquid debt instruments purchased
with a maturity of three months or less to be cash equivalents.
NOTE 2 - ACCOUNTS RECEIVABLE
Accounts receivable consists of the following:
June 30, December 31,
1999 1998
Casino $ 218,000 $ 516,000
Hotel 110,000 225,000
Other 519,000 83,000
847,000 824,000
Less allowance for
doubtful accounts 30,000 15,000
$ 817,000 $ 809,000
NOTE 3 - OTHER ASSETS
Other assets consist of the following:
June 30, December 31,
1999 1998
Expansion of gaming rights, less
accumulated amortization of
$729,000 and $709,000 $ 81,000 $ 101,000
Net investment in direct financing
lease, net of current portion (Note 7) 70,000 94,000
Leasehold costs, less accumulated
amortization of $412,000 and
$404,000 27,000 35,000
Deposits and other 582,000 724,000
$ 760,000 $ 954,000
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
NOTE 4 - ACCRUED LIABILITIES
Accrued liabilities consist of the following:
June 30, December 31,
1999 1998
Salaries and Wages $ 728,000 $1,267,000
Union back wages 33,000 40,000
Taxes, other than tax on income 291,000 343,000
Other 729,000 512,000
$1,781,000 $2,162,000
NOTE 5 - INCOME TAXES
The Internal Revenue Service has examined the Company's
Federal income tax returns through 1991. Management is of the
opinion that all taxes have been paid or provided for through
June 30, 1999.
NOTE 6 - LONG-TERM DEBT
Long-term debt consists of the following:
June 30, December 31,
1999 1998
Note Payable to Exber, Inc. at the Prime
Interest Rate payable in monthly
installments of $158,265 including
principal and interest, until July 6,
2004 at which time the balance is due.
The note is secured by a first deed of
trust in land and building (See Note 9). 26,400,000 25,500,000
Less current portion 7,106,000 7,106,000
$19,294,000 $18,394,000
Principal payments on long-term debt during the succeeding
five years are as follows:
1999 (Remaining six months) 7,106,000
2000 491,000
2001 530,000
2002 573,000
2003 619,000
Thereafter 17,081,000
$26,400,000
Maturities were calculated based upon interest rates in
effect at June 30, 1999.
<PAGE>
UNION PLAZA HOTEL AND CASINO INC., AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
NOTE 7 - LEASES
The Company leases equipment and hotel and bus depot
property under long-term lease agreements which are classified as
capital leases. The lease with Exber, Inc. (See Note 9) covering
the hotel and bus depot property expires in 2001 with renewals.
The hotel and bus depot property lease contains one renewal
option of twenty-five years and four renewal options of ten
years. The bus depot property is sublet to Greyhound Lines Inc.
under a lease expiring in 2001, with two ten-year renewal
options available. The value of the lease with Exber, Inc. is as
follows:
June 30, December 31,
1999 1998
Land and Buildings $ 9,242,000 $9,242,000
Less accumulated amortization 8,881,000 8,793,000
$ 361,000 $ 449,000
The following is a schedule of future minimum lease payments
as of June 30, 1999.
1999 (Remaining six months) $ 625,000
2000 1,250,000
2001 729,000
Total minimum lease payments 2,604,000
Less amount representing interest 349,000
Present value of net minimum
lease pmts under capital leases 2,255,000
Less current portion 937,000
Long-term obligations under
capital leases $ 1,318,000
SUBLEASES
The bus depot property under a capital lease is sublet as
follows:
June 30, December 31,
1999 1998
Minimum future rents receivable $ 137,000 $ 170,000
Less amount representing interest 18,000 27,000
Minimum future rents receivable 119,000 143,000
Less current portion (included in
accounts receivable) 49,000 49,000
Net investment in direct
financing lease (See Note 3)$ 70,000 $ 94,000
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
NOTE 8 - EMPLOYEE BENEFIT PLANS
The Company contributes to a discretionary executive bonus
plan. During the first six months of 1999 the Company issued
total bonuses of $22,000 compared to the same period last year
when $32,000 were distributed.
The Company also has a qualified profit sharing plan for
eligible employees. Contributions to this plan are made at the
discretion of the Board of Directors and benefits are limited to
the allocated interests in fund assets. During 1999 there have
have been no profit sharing plan contributions and it is
anticipated that there will be none. Last year, there was
$25,000 which was accrued in the first six months but was never
contributed.
NOTE 9 - RELATED PARTIES
On December 18, 1991, Exber, Inc., a 46.08% stockholder as
of June 30, 1999, loaned the Company $1,800,000, payable
interest only in monthly installments at 10% per annum, with
principal due in full December 19, 1996. During February 1992
this loan was increased to $3,000,000 subject to the same terms
and maturity date of the original borrowing. During February
1993 this loan was refinanced to $18,000,000, interest only
at the prime rate published in the Wall Street Journal until
February 14, 1999. On February 14, 1994 an additional $1,500,000
was added to this loan bringing the loan balance to $19,500,000
with the same terms and maturity date. On June 3, 1994 an
additional $3,700,000 was borrowed and the balance refinanced
payable in monthly installments of $158,265 including principal
and interest, until July 6, 2004. The majority of the proceeds
of the note were used to retire the outstanding debt to Bank of
America. At varying intervals during 1997, the Company borrowed
an additional $1,483,000 from Exber, Inc. to supplement cash flows
to meet normal operating requirements and during 1998 did the same,
increasing the note to $25,500,000. During the first six months
of 1999, the Company has borrowed an additional $900,000 from
Exber, Inc., to supplement its cash flows. The outstanding
Balance of the note at June 30, 1999 was $26,400,000.
Exber, Inc. also leases to the Company land and buildings in
Las Vegas, Nevada. Annual payments by the Company and its
subsidiaries are approximately $1,250,000. The leases extend
through 2001 with renewal options.
NOTE 10 - CONTINGENCIES
The Company has contingent liabilities with respect to
lawsuits and other matters arising in the ordinary course of
business. In the opinion of management, no material liability
exists with respect to these contingencies.
<PAGE>
PART 1. - FINANCIAL INFORMATION
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
ANALYSIS OF FINANCIAL CONDITION
The Company had total cash assets of $2,542,000(6.1% of total
assets) at June 30, 1999 and $3,228,000 (7.8% of total assets)
at December 31, 1998. The ratio of current assets to current
liabilities was .35 to 1 at June 30, 1999 and .4 to 1 at
December 31, 1998. Cash and cash equivalents declined compared
to the year-end amounts, however, the Company had $655,000
more cash than was held at the end of the second quarter of 1998.
The fluctuation in cash levels is relative to the irregular
nature of the gaming business along with additional borrowing
and increased capital expenditures during the second quarter of
1999.
Long-term debt obligations, including current maturities were
$26,400,000 at June 30, 1999 and $25,500,000 at December 31, 1998.
Long-term debt obligations increased by $900,000 during the
two quarters of 1999 in order to meet normal operating demands.
The proceeds were borrowed from Exber, Inc., the Company's majority
shareholder. Exber, Inc. continues to provide the Company with
operating cash as needed to meet normal obligations. Due to the
additional borrowing over the past several years it is apparent
that the Company will not be able to meet its current obligations
to Exber, Inc. Therefore, the Company plans to renegotiate the
terms of the note before the end of 1999. Due to the relationship
the Company has with Exber, Inc. it does not have any difficulties
in negotiating new terms to the loan agreement with them.
As if June 30, 1999, outstanding receivables were $817,000
compared to $809,000 at December 31, 1998. Inventories of food,
beverage and shop items rose $86,000 from $283,000 to $369,000
which is below the inventories held on June 30, 1998. Total
accounts payable were $3,855,000 at the end of June 1999 compared
to $2,472,000 at the end of June 1998. The $1.383 million increase
in accounts payable is attributed to equipment purchases made
during the second quarter. Total accrued liabilities declined
to $1.777 million from $2.162 million at the end of 1998. Compared
to June of 1998, accrued liabilities increased $141,000 due to
higher group insurance claims expected in the third quarter along
with increased jackpot liabilities in the card room.
RESULTS OF OPERATIONS
The results of the second quarter of 1999 were encouraging
for the Company as revenues rose 9.1% compared to the same period
one year ago. Gaming revenues rose $1,103,000 in the quarter as
slot win increased by $954,000 over the same period last year.
The slot department benefited from the purchase of over 500 new
video and slot gaming machines during the quarter which have been
received well by the Company's guests. The race and sports book
also showed some improvement over last year as the hold percentage
increased over last years levels. The card room reversed the first
quarter revenue decline and rose $45,000 in the second quarter.
Both keno and casino table games revenue declined in the second
quarter due to a lower hold percentage on the table games and
a decline in keno drop.
<PAGE>
PART 1. - FINANCIAL INFORMATION
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Food and beverage revenues rose $65,000 and room revenues rose
$39,000 during the quarter as a result of higher average room,
food and beverage prices. The Company implemented an overall
price increase to bring its prices in line with the prices of
its competitors. Additionally, the Company has recently
embarked on a strategy to upgrade its hotel, casino and
restaurants and feels the product and services that are offered
to its guests are still a bargain. Although food covers are
down and recent hotel occupancy levels have been declining,
the overall impact of the pricing decision may not be known
for some time. Management will continue to monitor these
key operating statistics and make adjustments where it feels
is needed.
Total operating expenses rose $544,000 or 4.3% during the
Second quarter due to higher costs in basically all areas. One
major contributor to the higher costs was the payment of
back-pay to employees who are members of the Culinary Union.
The back-pay was a result of the final contract negotiations
with the Union. Slot related expense rose in the quarter
reflecting the revenue sharing agreements with slot machine
manufacturers whose games are among the most popular. Repair
and maintenance also increased as part of the Company's new
attention to detail at the property.
Overall, the Company reported a net operating loss of $408,000
in the quarter versus a $1,262,000 loss reported in the
second quarter of 1998. Interest expense rose $27,000 to
$583,000 compared to last year causing the Company's net loss
to expand to $991,000 compared with a loss of $1,692,000
reported a year ago. On a per share basis, the loss was
$1.31 in 1999 versus a loss of $2.23 in 1998.
Although business activity at the hotel and casino did
improve during the second quarter, the Company is concerned
about the prospects of its gaming business. Competition is
at an all-time high as the new resorts that have been built
in Las Vegas continue to affect the entire industry. Resort
operators on the strip and in the outlying areas of the
City are aggressively marketing their casinos to our
Customer(s) with bigger and better offerings. Management
believes that the recent slot purchases and building
improvements are a must to ensure the property remains a
viable entity. Management also understands that prompt and
courteous service is a must in this industry and they are
implementing steps to improve the overall level of service
at this property. Management realizes that a rapid return
to profitability will be difficult and will require
significant capital expenditures to become competitive in
this market. The improvements that have been made during
the second quarter in the first step to making this property
a first class operation downtown.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934 the registrant had duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
UNION PLAZA HOTEL AND CASINO, INC.
(REGISTRANT)
Date: August 13, 1999 /SS/ JOHN D. GAUGHAN
JOHN D. GAUGHAN, President
Date: August 13, 1999 /SS/ LARRY DOLESH
LARRY DOLESH, Vice President
of Finance
Date: August 13, 1999 /SS/ JOHN P. JONES
JOHN P. JONES, Vice President &
Treasurer
16
[TEXT]
[ARTICLE] 5
<TABLE>
<S> <C>
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] DEC-31-1999
[PERIOD-END] JUN-30-1999
[CASH] 2542000
[SECURITIES] 0
[RECEIVABLES] 817000
[ALLOWANCES] 0
[INVENTORY] 369000
[CURRENT-ASSETS] 4738000
[PP&E] 103757000
[DEPRECIATION] 67661000
[TOTAL-ASSETS] 41594000
[CURRENT-LIABILITIES] 13675000
[BONDS] 19294000
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 750000
[OTHER-SE] 6913000
[TOTAL-LIABILITY-AND-EQUITY] 41594000
[SALES] 5115000
[TOTAL-REVENUES] 17361000
[CGS] 2514000
[TOTAL-COSTS] 40081000
[OTHER-EXPENSES] 5205000
[LOSS-PROVISION] 21000
[INTEREST-EXPENSE] 1165000
[INCOME-PRETAX] (1391000)
[INCOME-TAX] 0
[INCOME-CONTINUING] (1391000)
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (1391000)
[EPS-BASIC] ( 1.84)
[EPS-DILUTED] ( 1.84)
</TABLE>
