UNION PLAZA HOTEL AND CASINO, INC.
1 Main Street
Las Vegas, NV 89101
March 31, 2000
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-K along with
Exhibit 13 (Annual Report) and the 1999 financial data statement.
Sincerely,
UNION PLAZA HOTEL AND CASINO, INC.
Larry Dolesh, Vice President
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
1999
ANNUAL REPORT
<PAGE>
TABLE OF CONTENTS
Page
Letter to Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . .1
Selected financial data. . . . . . . . . . . . . . . . . . . . . . . . . .2
Management's discussion and analysis of
financial condition and results of
operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3-5
Independent Auditors' Reports . . . . . . . . . . . . . . . . . . . . .6-7
Financial Statements:
Consolidated balance sheets. . . . . . . . . . . . . . . . . . . . . .8-9
Consolidated statements of loss . . . . . . . . . . . . . . . . . . . 10
Consolidated statements of stockholders' equity. . . . . . . . . . . . 11
Consolidated statements of cash flows. . . . . . . . . . . . . . . .12-13
Notes to consolidated financial statements. . . . . .. . . . . . . .14-26
Directors and executive officers . . . . . . . . . . . . . . . . . . . . 27
Special information. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
<PAGE>
To Our Shareholders,
Given the competitive nature of our industry and the continuing expansion of
hotel rooms in Las Vegas, we are encouraged by the results of 1999. Net
revenues at our casino were the highest in three years while operating and
promotional expenses were the lowest in as many years. While these results
are an improvement over the past few years, there is much to be done to bring
our property back to profitability.
During this last year we have been addressing several fundamental issues that
need improvement in order to deliver the operating and financial performance
that our hotel and casino is capable of. The improvements that have been made
and the continued modernization of the property will allow the Company to
expand its marketing efforts beyond the existing customer base.
We began a strategic shift in the operation of our casino near the end of the
first quarter of 1999 which includes the process of upgrading all segments of
our operation. The improvements made to our slot floor and the overall look
of our casino have been well received by our customers as shown by the growth
in gaming revenue during 1999. Our hotel rooms are also receiving a high
degree of attention along with upgraded menus in each of our restaurants.
There were also several measures that were put in place to increase the
efficiency of our operation during the year. Revising the manner in which
we do business in certain areas has improved the level of customer service
for our guests and has reduced personnel costs in the process.
While 1999 was a transition year at the Plaza, and the improvements have been
welcomed by our existing customers, we feel the year 2000 will be crucial to
the future of our Company. We plan to continue to refurbish the hotel and to
upgrade the gaming equipment and computer systems to become more competitive
in the marketplace. As expected, these upgrades and improvements are
expensive and will require us to use existing cash, future cash flows and
debt financing to fund the improvements. We are pleased with the response
so far from our customers and feel that this capital spending is necessary
to bring this property back to profitability.
In closing, I would like to thank each of you for your continued support as
we close out another year and look forward to the future. Please make plans
to join us on May 19, 2000 at 10:00am in the Center Stage Restaurant for the
annual meeting of shareholders.
Sincerely,
/s/ JOHN D. GAUGHAN
John D. Gaughan
Chairman of the Board
<PAGE>
<TABLE>
SELECTED FINANCIAL DATA
Amounts in thousands, except per share data
<CAPTION>
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net revenues $ 48,052 $ 45,847 $ 48,015 $ 53,332 $ 51,999
Casino operating
revenue 32,091 30,886 32,135 36,292 36,558
Net income (loss) (3,167) (5,002) (3,644) (736) 104
Total assets 43,278 41,539 45,192 49,317 53,163
Long-term
obligations 29,887 20,558 26,079 26,510 29,845
Stockholders'
equity 5,137 8,304 13,331 16,977 17,794
Earnings (loss)
per common
share $ (4.18) $ (6.60) $ (4.80) $ (.97) $ .14
Cash dividends
declared
common share $ -0- $ -0- $ -0- $ -0- $ -0-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the
Company's Consolidated Financial Statements and accompanying notes. Certain
statements in this report are forward-looking statements that involve risks
and uncertainties, which could cause the Company's future results to differ
from the expectations described herein. Forward-looking statements should
be evaluated in the context of risk factors and uncertainties.
RESULTS OF OPERATIONS
1999 COMPARED TO 1998
For 1999, the Company's net revenues increased 4.8% over 1998 to $48,052,000.
Revenue growth was led by higher slot gaming win and lower
promotional allowances. During the year, the Company has invested
substantial resources to improve the appearance of the property and to
improve the level of customer service throughout the property. While this
process is far from complete, the results of these changes have reversed
the negative trend in revenue growth and reduced the Company's operating
losses by 74.8% compared to 1998.
The Company's operating loss was $1,159,000 in 1999 compared to $4,592,000
in 1998. Net losses were $3,167,000 and $5,002,000 in 1999 and 1998
respectively.
Revenue from the Company's casino operations rose 3.9% in 1999 after
declining 3.9% in 1998. During the year, the Company purchased and leased
a significant number of new electronic gaming machines to offer its customers
a wider selection of gaming options during their stay. The Company has also
increased its mix of participating games, where revenue is shared with the
slot machine manufacturers who provide the games. These new games and the
signage on the floor have improved the look of the casino floor and have
helped drive slot revenues.
The Company has also redefined its promotional policy during the year to
ensure that qualified players are rewarded adequately for their play while
excessive and unqualified complimentaries have been largely eliminated.
This change in policy resulted in over $550,000 in savings during the year.
As explained above, the Company's revenue increase in 1999 was primarily
attributable to increased slot revenue, that represented 40.0% of gross
revenue. The modernization and ever changing layout of the slot floor
have dramatically increased the revenue despite an average of 190 fewer
games on the casino floor. Revenue for the remainder of the casino
declined by approximately $520,000 as table game revenue fell $527,000.
The table games win percentage fell one full percent during the year and
overall handle was down $480,000. The decline in handle in mostly
<PAGE>
attributed to a decision to close certain areas of the casino pit during
slow periods. The overall impact of this decision helped to significantly
reduce casino payroll expenses. Revenues from the card room and from
counter games were basically unchanged from a year ago.
Operating expenses for 1999 were $49,211,000 compared to $50,439,000
in 1998. The reduction of payroll expense in virtually all departments
had the largest single impact on departmental costs. Casino payroll
fell $684,000 despite $327,000 paid on behalf of the slot department
for the settlement of a Culinary Union Arbitration and Culinary back-pay
related to a new Culinary contract signed in 1999.
Food and beverage cost of sales declined more than $280,000 during 1999
as the Company increased prices to levels comparable to the competition.
While food revenue increased $233,000, covers declined by 73,000.
Beverage sales fell $190,000 although cash sales rose 7.6% or $70,000.
Complimentary beverage sales fell nearly 10.0% or $260,000.
Advertising and promotion expense increased nearly 100% or $295,000
for the year which is reflective of the increase in promotional efforts
at the Company's casino. During the year, newspaper advertising was
up $122,000 while radio/television advertising and related artwork
was up $60,000. Holiday giveaways and a recently started paycheck
promotion accounted for $61,000 in additional expense. Unredeemed group
package items declined by $48,000 due to fewer group bookings and
postage and general supply costs increased $4,000.
Utility and maintenance expenses were up more than $300,000 during the
year. Electricity costs were 11.6% or $170,000 higher than the previous
year which the Company attributes to more exterior lighting on the
property. Water, sewer and rubbish removal and other related costs were
also higher during the year by a combined total of $49,000. Maintenance
expenses related to upgrading floor coverings, furnishings, and the building
itself, were up over 22% compared to last year.
Depreciation and amortization expenses were lower by $176,000 during
1999 which is attributed to the first half of the year. Capital
investments in slot machines, remodeling, and other improvements, in
the middle and latter stages of the year, have increased the depreciation
expenses in the last quarter.
Interest expense increased $225,000 over last year as a result of the
additional debt incurred by the Company during the year compounded by
rising interest rates.
The Company's loss before the benefit of deferred income taxes declined
to $3,561,000 in 1999 from $7,621,000 in 1998. The net loss declined to
$3,167,000 in 1999 from $5,002,000 in 1998. The Company's effective tax
rate was (12.4%) and (34.4%) for the years 1999 and 1998 respectively.
The actual tax benefit from net operating loss carry-forwards at
December 31, 1999 was $394,000 and $2,619,000 at December 31, 1998.
The loss per common share decreased to $4.18 in 1999 from $6.60 in 1998.
<PAGE>
1998 COMPARED TO 1997
Gross revenues for 1998 fell to $53,500,000 from $55,400,000 in 1997, a
decrease of $1,900,000(3.5%). This decrease was largely due to a $1,200,000
decrease in casino win and a decrease of $657,000 in room revenue. An increase
in food and beverage revenue of $172,000(1.8%) was offset by a decrease in
other income of $152,000(6.7%).
The Company's operating loss for 1998 was $4,600,000 while the operating
loss for 1997 was $2,200,000, an increase of $2,400,000(109%).
The increased loss is due almost entirely to a decline in revenue as
operating expenses increased slightly during 1998. Casino revenue fell
$1,200,000(3.9%) as all departments win percentages fell during 1998.
Room revenue was down $657,000 as 24,000 fewer guests stayed at the
hotel in 1998. Promotional allowances increased $279,000(3.8%)in 1998.
Operating expenses increased by $200,000(.4%) due primarily to higher
payroll expense.
Operating expenses for 1998 were $50,400,000 and for 1997 were
$50,200,000, an increase of $200,000(.4%). Total payroll costs
for table games increased $217,402(4.4%) to go along with an
increased payroll for keno of $92,252(19.7%). Table games added
employees as did keno with the addition of a satellite station.
Utilities and maintenance cost increased $160,000 as power rates
and air conditioning increased during hotter summer months.
Operating expense for rooms decreased as 24,000 fewer guests
stayed at the hotel during 1998. Advertising expenses declined
$81,000 (21.0%) due in part to the 1997 write-down of $53,000
in old promotional giveaways and personnel costs that were
$17,000 lower that those in the year prior.
Interest expense increased $82,000(3.8%) during 1998 due to additional
borrowing from major shareholder Exber, Inc. Also, the loss from the
Fremont Street Experience(Note 13) was $792,000 in 1998 and $471,000
in 1997, a 68.2% increase in costs.
LIQUIDITY AND CAPITAL RESOURCES
At December 31, 1999, the Company's primary source of liquidity was
3,250,000 in cash and marketable securities and a $1,000,000 letter of
credit secured by the Company's majority shareholder. The Company's cash
assets accounted for 7.5% of total assets at December 31, 1999 and 8.5% or
$3,527,000 of the total assets at December 31, 1998. The ratio of
current assets to current liabilities was .6 to 1 for 1999 and .4 to 1
for 1998. The improvement in the current ratio is attributable to the
reduction in the current portion of the long-term debt. While the current
portion of the long-term debt was not paid by the Company, the note was
refinanced and the current portion was properly reclassified as long-term
debt.
Long-term debt and obligations under capital leases (including current term
portions) was $32,593,000 at December 31, 1999 compared to $28,207,000 at
December 31, 1998. The increase in obligations is attributable to additional
financing for equipment of $3,355,000, less repayments of $932,000 and
$2,925,000 in additional borrowings from Exber, Inc., less repayments of
$962,000.
<PAGE>
Management expects the cash generated by operations to improve based on
recent trends in its business. Cash flows from operations was a negligible
minus $22,000 in 1999 which was a significant improvement over 1998 when
the Company recorded negative cash flow of $2,400,000. The Company also
considers the financial stability of its majority shareholder to be a
source of capital for future investment in equipment and funding for
operations if needed. These factors considered, management believes that
its capital resources and those available to it should be adequate to meet
its anticipated requirements.
PRIVATE SECURITIES LITIGATION REFORM ACT
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward looking statements. Certain information included in the 10-K and
other materials filed by the Company with the Securities and Exchange
Commission contains statements that are forward-looking, such as statements
relating to plans for capital spending , financing sources and effects of
regulation and competition. Such forward-looking statements involve important
risks and uncertainties that could significantly affect anticipated results in
the future, and accordingly, actual results may differ materially from those
expressed in any forward-looking statements made by or on behalf of the
Company.
Due to the fact that shares in the Company are closely held and there is
virtually no trading in the common shares, the performance graph has been
omitted from this filing.
<PAGE>
INDEPENDENT AUDITOR'S REPORT
The Stockholders and
Board of Directors
Union Plaza Hotel and Casino, Inc.
We have audited the accompanying consolidated balance sheet of Union Plaza
Hotel and Casino, Inc. and subsidiaries (a Nevada Corporation) as of December
31, 1999, and the related consolidated statement of loss, stockholders' equity
and cash flows for the year then ended. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Union Plaza Hotel and
Casino, Inc. and subsidiaries as of December 31, 1999, and the results of
their operations and their cash flows for the year then ended in conformity
with generally accepted accounting principles.
Conway, Stuart & Woodbury
Las Vegas, Nevada
March 1, 2000
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Stockholders and
Board of Directors
Union Plaza Hotel and Casino, Inc.
We have audited the accompanying consolidated balance sheets of Union Plaza
Hotel and Casino, Inc. and subsidiaries as of December 31, 1998, and
the related consolidated statements of loss, stockholders' equity
and cash flows for the years ended December 31, 1998 and 1997. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Union Plaza Hotel and
Casino, Inc. and subsidiaries as of December 31, 1998, and results of
their operations and their cash flows for the years ended December 31,
1998 and 1997 in conformity with generally accepted accounting principles.
GARY V. CAMPBELL, CPA, LTD
Las Vegas, Nevada,
February 22, 1999
<PAGE>
</TABLE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1999 AND 1998
Amounts in thousands, except per share data
<CAPTION>
ASSETS
1999 1998
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,250 $ 3,527
Accounts receivable, net 519 510
Inventories of food, beverage
and supplies 348 283
Prepaid expenses 810 999
TOTAL CURRENT ASSETS 4,927 5,319
PROPERTY AND EQUIPMENT:
Land 7,012 7,012
Buildings 56,887 56,854
Leasehold improvements 3,530 3,514
Furniture and equipment 39,607 33,950
107,036 101,330
Less accumulated depreciation
and amortization 69,526 66,064
NET PROPERTY AND EQUIPMENT 37,510 35,266
OTHER ASSETS 841 954
$ 43,278 $ 41,539
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 31, 1999 AND 1998
LIABILITIES AND STOCKHOLDERS' EQUITY
Amounts in thousands, except per share data
<CAPTION>
1999 1998
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 3,709 $ 2,472
Accrued liabilities 1,839 2,162
Current portion of long-term debt 1,368 7,106
Current portion of obligations under
capital leases 1,338 937
TOTAL CURRENT LIABILITIES 8,254 12,677
LONG-TERM DEBT,
less current portion 28,754 18,394
OBLIGATIONS UNDER CAPITAL LEASES,
less current portion 1,133 1,770
DEFERRED INCOME TAXES - 394
TOTAL LIABILITIES 38,141 33,235
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, 1999 and 1998 750 750
Additional paid-in capital 5,462 5,462
Retained earnings 12,822 15,989
19,034 22,201
Less: treasury stock at cost, 742,581 shares
at December 31, 1999 and 1998 13,897 13,897
TOTAL STOCKHOLDERS' EQUITY 5,137 8,304
$ 43,278 $ 41,539
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF LOSS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
Amounts in thousands, except per share data
<CAPTION>
1999 1998 1997
<S> <C> <C> <C>
REVENUES:
Casino $ 32,091 $ 30,886 $ 32,135
Food and beverage 9,709 9,687 9,515
Rooms 11,077 10,815 11,472
Other 2,268 2,106 2,258
GROSS REVENUES 55,145 53,494 55,380
Less promotional allowances 7,093 7,647 7,368
NET REVENUES 48,052 45,847 48,012
OPERATING EXPENSES:
Casino 13,276 14,469 14,089
Food and beverage 14,387 14,646 14,674
Rooms 5,624 5,685 5,771
General and administrative 3,983 4,072 3,876
Entertainment 597 629 619
Advertising and promotion 599 304 385
Utilities and maintenance 5,944 5,640 5,480
Depreciation and amortization 3,566 3,742 4,094
Provision for doubtful accounts 24 37 33
Other costs and expenses 1,211 1,215 1,218
TOTAL OPERATING EXPENSES 49,211 50,439 50,239
OPERATING LOSS (1,159) (4,592) (2,227)
OTHER INCOME (EXPENSE):
Interest income 19 28 39
Gain on sale of assets 72 3 3
Interest expense (2,493) (2,268) (2,186)
Investment in Fremont Street
Experience - (792) (471)
TOTAL OTHER INCOME (EXPENSE) (2,402) (3,029) (2,615)
LOSS BEFORE INCOME TAX (3,561) (7,621) (4,842)
INCOME TAX BENEFIT:
Current - - 196
Deferred 394 2,619 1,002
TOTAL INCOME TAX BENEFIT 394 2,619 1,198
NET LOSS $(3,167) $(5,002) $ (3,644)
LOSS PER COMMON SHARE $( 4.18) $( 6.60) $ ( 4.80)
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
Amounts in thousands, except per share data
<CAPTION>
Additional
Common paid-in Retained Treasury
stock capital earnings stock Total
<S> <C> <C> <C> <C> <C>
BALANCE:
December 31, 1996 $750 $ 5,462 $ 24,635 $(13,870) $ 16,977
Purchase of 50
shares of
treasury stock - - - ( 2) ( 2)
Net loss for 1997 - - (3,644) - (3,644)
BALANCE:
December 31, 1997 $750 $ 5,462 $ 20,991 $(13,872) $ 13,331
Purchase of 1,000
shares of
treasury stock - - - ( 25) ( 25)
Net loss for 1998 - - (5,002) - (5,002)
BALANCE:
December 31, 1998 $750 $5,462 $15,989 $(13,897) $ 8,304
Net loss for 1999 - - (3,167) - (3,167)
BALANCE:
December 31, 1999 $750 $5,462 $12,822 $(13,897) $ 5,137
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
Amounts in thousands, except per share data
<CAPTION>
1999 1998 1997
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $ 47,853 $ 45,736 $ 48,056
Cash paid to suppliers and
employees (45,958) (47,255) (46,025)
Interest received 19 28 59
Interest paid ( 1,936) ( 1,121) ( 2,186)
Income taxes received - 197 144
NET CASH PROVIDED BY
(USED IN)OPERATING
ACTIVITIES ( 22) (2,415) 48
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property
and equipment 72 3 21
Proceeds from sale of bonds - - 25
Purchase of property and equipment ( 1,006) ( 412) ( 461)
NET CASH USED IN
INVESTING ACTIVITIES ( 934) ( 409) ( 415)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt 2,500 3,500 1,483
Principal payments on capital leases ( 999) ( 396) ( 714)
Principal payments on long-term debt ( 822) ( 89) ( 253)
Purchase of treasury stock - ( 25) ( 2)
NET CASH PROVIDED BY
FINANCING ACTIVITIES 679 2,990 514
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS ( 277) 166 147
CASH AND CASH EQUIVALENTS,
at beginning of the year 3,527 3,361 3,214
CASH AND CASH EQUIVALENTS,
At end of the year $ 3,250 $ 3,527 $ 3,361
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
Amounts in thousands, except per share data
<CAPTION>
1999 1998 1997
<S> <C> <C> <C>
RECONCILIATION OF NET LOSS TO NET
CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Net loss $(3,167) $(5,002) $(3,644)
ADJUSTMENTS TO RECONCILE NET LOSS
TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Depreciation and amortization 3,566 3,742 4,094
Gain on sale of property
equipment and
improvements ( 72) ( 3) ( 3)
Interest expense 352 1,147 -
Equity investment loss - 387 471
Provision for doubtful accounts 24 ( 13) ( 15)
(Increase) decrease in assets:
Accounts receivable ( 33) 98 51
Interest receivable - - 20
Inventories ( 65) ( 16) 67
Prepaid expenses 182 ( 20) 18
Other assets 72 53 ( 16)
Increase (decrease) in liabilities:
Accounts payable ( 164) ( 273) 422
Checks issued against future deposits - - ( 330)
Accrued salaries ( 469) 43 140
Other accrued liabilities 146 61 ( 225)
Deferred income tax ( 394) (2,619) (1,002)
TOTAL ADJUSTMENTS 3,145 2,587 3,692
NET CASH PROVIDED BY
(USED IN) OPERATING
ACTIVITIES $( 22) $(2,415) $ 48
<FN>
The accompanying notes to consolidated financial statements
are an integral part of these financial statements.
</TABLE>
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
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.
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements for 1999, 1998 and
1997 include the accounts of Union Plaza Hotel and Casino, Inc. (the
Company) and its wholly-owned subsidiaries. All material intercompany
balances and transactions have been eliminated in consolidation.
CASINO REVENUE AND RECEIVABLES
In accordance with common industry practice, 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. 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 uncollectible casino receivables are provided to reduce these
receivables to amounts anticipated to be collected. The Company does
not believe it is subject to any unusual credit risk beyond the normal
risk attendant to operating its business.
PROMOTIONAL ALLOWANCES
Gross revenues include the retail value of complimentary food, beverage
and hotel services furnished to customers. The retail value of these
promotional allowances is deducted to arrive at net revenues.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FAIR VALUE OF FINANCIAL INSTRUMENTS
Based on the borrowing rates currently available to the Company, the
carrying value of notes payable and long-term debt approximate fair
value.
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.
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 capitalized leases, 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.
PROGRESSIVE JACKPOT LIABILITY
The Company has a number of progressive jackpot slot machines and
progressive poker games. As coins are played on the progressive
jackpot slot machines, the amount available to win increases and will
be paid out when the appropriate jackpot is hit. The jackpots for the
poker games also increase with amount of play, to be paid out when hit.
In accordance with common industry practice, the Company has recorded the
progressive jackpots as a liability with a corresponding charge against
casino revenue.
INVENTORIES
Inventories are valued at the lower 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.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
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 or financing activities. For
purposes of the statement of cash flows, the Company considers all highly
liquid investments purchased with a maturity of three months or less to be
cash equivalents.
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 general business 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.
<TABLE>
NOTE 2 - CASH
The Company maintains cash balances in two financial institutions in
Las Vegas, Nevada insured by the Federal Deposit Insurance Corporation up to
$100,000 . Uninsured balances at December 31, 1999 and December 31, 1998 are
$524,000 and $223,000 respectively. Also included in cash are uninsured money
market funds amounting to $24,000 and $23,000 at December 31, 1999 and
December 31, 1998, respectively.
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable consist of the following:
Amounts in thousands
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Casino $ 384 $ 217
Hotel 120 225
Other 99 83
603 525
Less allowance for
doubtful accounts 84 15
$ 519 $ 510
</TABLE>
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 4 - OTHER ASSETS
Other assets consist of the following:
Amounts in thousands
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Expansion of gaming rights, less
accumulated amortization of
$749,000 and $709,000 $ 61 $ 101
Net investment in direct financing
lease, net of current portion 37 94
Leasehold costs, less accumulated
amortization of $419,000 and
$404,000 20 35
Deposits and other 723 724
$ 841 $ 954
</TABLE>
<TABLE>
NOTE 5 - ACCRUED LIABILITIES
Accrued liabilities consist of the following:
Amounts in thousands
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Salaries and wages $ 798 $ 1,267
Union back wages 33 40
Taxes, other than taxes on income 301 343
Accrued Interest 205 -
Other 502 512
$ 1,839 $ 2,162
</TABLE>
NOTE 6 - INCOME TAXES
Deferred income tax expense (benefit) results from timing differences
in the recognition of revenue and expense for tax and financial statement
purposes.
Statements of Financial Accounting Standards No. 109, "Accounting for
Income Taxes," (SFAS 109) requires deferred tax liabilities or assets at
the end of each period be determined using the tax rate expected to be in
effect when taxes are actually paid or recovered.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 6 - INCOME TAXES (CONTINUED)
<TABLE>
The sources of those timing differences and the current tax effect
of each were as follows:
Amounts in thousands
<CAPTION>
1999 1998 1997
<S> <C> <C> <C>
Depreciation and respective
gains $( 422) $( 228) $ 59
Capitalized leases 242 203 170
Net operating losses (1,027) (2,510) (1,477)
Vacation and backpay ( 13) 15 ( 9)
Tax credits 11 436 ( 249)
Tax credit valuation allowance ( 78) ( 513) 513
Other 48 ( 22) ( 9)
$(1,239) $(2,619) $(1,002)
Less valuation allowance 845 - -
$( 394) $(2,619) $(1,002)
</TABLE>
<TABLE>
The components of the net deferred tax liability at December 31, 1999 and
1998 under SFAS 109 are as follows:
<CAPTION> December 31,
1999 1998
<S> <C> <C>
Depreciation and
amortization $ 5,935 $ 6,113
Net operating loss (5,675) (4,716)
Tax and AMT credits, net - ( 710)
Other ( 260) ( 293)
$ - $ 394
</TABLE>
The Company has net operating loss and tax credit carryforwards at
December 31, 1999 of approximately $16,889,000 and $781,000 respectively,
with expiration dates through December 31, 2019. Tax credits are used
to reduce federal income taxes in the year in which benefit is available.
<PAGE>20
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 6 - INCOME TAXES (CONTINUED)
<TABLE>
Reconciliations between the actual tax expense (benefit) and the amount
computed by applying the U.S. Federal Income Tax rate to income (loss) before
taxes are as follows:
Amounts in thousands
<CAPTION>
1999 1998 1997
Percent Percent Percent
of of of
Pretax Pretax Pretax
Amount Income Amount Income Amount Income
<S> <C> <C> <C> <C> <C> <C>
Computed "expected"
tax expense(benefit) $(1,077) (34.0%) $(2,588) (34.0%) $(1,646) (34.0%)
Increase (reduction)
in tax resulting from:
Tax credits 11 0.4% 436 ( 1.0%) ( 110) ( 2.3%)
Tax credit valuation
allowance (78) ( 2.5%) (513) - 513 10.6%
Other - - - - ( 3) ( 0.1%)
Nondeductible
expenses (95) ( 2.9%) 46 0.6% 48 1.0%
Actual tax Benefit $(1,239) (39.0%) $(2,619) (34.4%) $(1,198) (24.8%)
Less valuation allowance 845 26.6% - - - -
$( 394) (12.4%) $(2,619) (34.4%) $(1,198) (24.8%)
</TABLE>
NOTE 7 - LONG-TERM DEBT
<TABLE>
Long-term debt at December 31, 1999 and 1998 is as follows:
Amounts in Thousands
<CAPTION>
December 31,
1999 1998
<C> <C>
Related party note, as amended, payable
in monthly payments of interest only
at prime not to exceed 12%, until
January 1, 2005 at which time the entire
balance plus accrued interest is due.
The note is secured by a First Deed of
Trust on land and buildings. The
effective rate of interest at December
31, 1999 is 8.5%. $ 28,400 $ 25,500
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 7 - LONG-TERM DEBT (CONTINUED)
December 31,
1999 1998
<C> <C>
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of 25% of net win with no
stated interest for the first twelve
months, after which an interest rate of
3% over prime applies to the remaining
balance. Any remaining balance plus
accrued interest is due on April 1, 2001. $ 146 -
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of 25% of net win with no
stated interest for the first twelve
months, after which an interest rate of
3% over prime applies to the remaining
balance. Any remaining balance plus
accrued interest is due on May 1, 2001. $ 1,037 -
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of 25% of net win with no
stated interest for the first twelve
months, after which an interest rate of
3% over prime applies to the remaining
balance. Any remaining balance plus
accrued interest is due on April 1, 2001. $ 28 -
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 7 - LONG-TERM DEBT (CONTINUED)
December 31,
1999 1998
<C> <C>
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of 25% of net win with no
stated interest for the first twelve
months, after which an interest rate of
3% over prime applies to the remaining
balance. Any remaining balance plus
accrued interest in due on September 1,
2001. $ 72 $ -
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of 25% of net win with no
stated interest. Any remaining balance
plus accrued interest is due on July 1,
2001. $ 178 $ -
Contract payable, secured by slot machines
and related equipment, payable in monthly
installments of $32,707 until August 31,
2000, with no stated interest. 261 -
30,122 25,500
Less current portion 1,368 7,106
$ 28,754 $ 18,394
</TABLE>
On January 21, 2000 the related party note payable was refinanced under
the terms disclosed above.
Principal payments on long-term debt during the succeeding five years are
as follows:
2000 $ 1,368
2001 354
2002 - 2004 -
Thereafter 28,400
$ 30,122
Interest on long-term debt was $2,143,000 in 1999, $1,836,000 in 1998 and
$1,650,000 in 1997.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 8 - LEASES
The Company leases buildings and equipment under long-term agreements
which are classified as capital leases. The lease with Exber Inc., a
46.61% stockholder of the Company, covering the hotel and bus depot
property expires in 2001 and contains one renewal option of twenty-five
years and four renewal options of ten years each. The bus depot property
is sublet to Greyhound Lines, Inc. under a lease expiring in 2001, with
two ten-year renewal options available.
<TABLE>
Property and equipment includes the following property under capital
leases by major classes:
Amounts in thousands
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Buildings $ 9,242 $ 9,242
Equipment 906 -
10,148 9,242
Less accumulated amortization:
Buildings 8,969 8,793
Equipment 116 -
$ 1,063 $ 449
</TABLE>
Depreciation and amortization expense includes amortization of property
under capital leases of $176,000, per year for 1999, 1998, and 1997 and
amortization of equipment of $115,000 for 1999.
Interest paid on property under capital leases was $350,000 for 1999,
$432,000 for 1998 and $536,000 for 1997.
Future minimum payments, by year and in the aggregate, under capital leases
and non-cancelable operating leases with initial or remaining terms of one
year or more consist of the following at December 31, 1999:
CAPITAL
LEASES
(In thousands)
2000 $ 1,571
2001 1,051
2002 149
Total Minimum Lease Payments 2,771
Less amount representing interest 300
Present value of net minimum lease
payments under capital leases 2,471
Less current portion 1,338
Obligations Under Capital Leases $ 1,133
<PAGE>
<TABLE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 8 - LEASES (CONTINUED)
Rental expense for all operating leases are as follows:
Amounts in thousands
<CAPTION>
1999 1998 1997
<S> <C> <C> <C>
Parking lot leases $ 24 $ 24 $ 24
</TABLE>
<TABLE>
SUBLEASES
The bus depot property under a capital lease is sublet as follows:
Amounts in thousands
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Minimum future rents receivable $104 $170
Less amount representing interest 11 27
Minimum lease payments receivable 93 143
Less current portion (included in
accounts receivable) 56 49
Net investment in direct financing
lease (included in other assets) $ 37 $ 94
</TABLE>
OTHER SUBLET RENTAL PROPERTY
The Company rents building space to several retail stores under various
short-term leases. Income from these subleases, included in other income,
for 1999, 1998, and 1997 was $293,000, $311,000 and $313,000.
NOTE 9 -EMPLOYEE BENEFIT PLANS
The Company contributes to a discretionary executive bonus plan.
Contributions for 1999, 1998, and 1997 were $31,000, $32,000 and $-0-,
respectively.
The Company also has a qualified profit sharing plan for eligible non-union
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. No contributions were made to the plan for 1999, 1998, and 1997.
The Company provides no post-retirement benefits to employees subject to the
requirements of Statement of Financial Accounting Standards No. 106 (SFAS 106)
which requires accrual of expected cost of providing those benefits to an
employee during the years that the employee renders service.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 10 - EARNINGS (LOSS) PER COMMON SHARE
Earnings (loss) per common share is based on the weighted average number
of shares of common stock outstanding during the years. Shares used for the
computation on earnings per common share are 757,419 in 1999, 757,819 in 1998
and 758,420 in 1997.
NOTE 11 - RELATED PARTIES
The related party note payable of $28,400,000, as more fully described in
Note 7, is payable to Exber, Inc., a 46.61% stockholder of the Company.
Included in accrued liabilities is $205,000 of accrued interest relating to
this note at December 31, 1999. Interest expense on this note was
$2,143,000, $1,836,000 and $1,650,000 for 1999, 1998, and 1997, respectively.
In addition, the Company has a line of credit for $1,000,000 with Exber, Inc.
to be used for normal operating requirements as needed. As of December 31,
1999 and 1998 the outstanding balance was $0.
The Company also pays $1,250,000 in annual capital lease payments to Exber,
Inc. for the hotel and bus depot property, as more fully described in Note 8.
Interest expense on this capital lease was $313,000, $432,000, and $513,000
for 1999, 1998, and 1997, respectively.
The Company paid $53,000 to Coast Hotels and Casinos, Inc. d/b/a Gold Coast
Hotel and Casino during 1999 in connection with various construction services
provided to the Company. Coast Hotels and Casinos, Inc. is a wholly-owned
subsidiary of Coast Resorts, Inc. A majority stockholder of Coast Resorts,
Inc. is the son of the President of the Company.
The Company paid $29,000, $31,000 and $30,000 to Las Vegas Dissemination,
Inc. during 1999, 1998 and 1997, respectively, in connection with race
book pari-mutuel system operator fees. The sole stockholder of Las Vegas
Dissemination, Inc. is the grandson of the President of the Company.
NOTE 12 - CONTINGENCIES
LITIGATI0N
The Company has contingent liabilities with respect to lawsuits and other
matters arising in the ordinary course of business. It is estimated that the
adverse effect of these lawsuits will not exceed $90,000.
LIQUIDITY AND CAPITAL RESOURCES
The Company has had recurring net losses over the past three
years amounting to $3,167,000, $5,002,000 and $3,644,000 in 1999, 1998
and 1997 respectively. At December 31, 1999 its current liabilities
exceed its assets by approximately $3,327,000.
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 13 - INVESTMENT IN FREMONT STREET EXPERIENCE
In 1994, the Company's wholly-owned subsidiary, Union Plaza Experience,
Inc., was organized 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. The
Company's 5.9% investment was accounted for by the equity method
whereby the investment was increased or decreased by their proportionate
share of the investors net earnings or loss, which amounted to losses of
$792,000 and $471,000 for the years 1998 and 1997 respectively.
During 1998, the Union Plaza Experience, Inc. withdrew from the
Fremont Street Experience and has been released of all liability.
NOTE 14 - ADVERTISING COSTS
The Company expenses advertising costs as incurred. Advertising expense
was $599,000, $304,000 and $385,000 for the years ended December 31, 1999,
1998 and 1997 respectively.
NOTE 15 - SUPPLEMENTAL CASH FLOWS INFORMATION
<TABLE>
Supplemental schedule of noncash
Investing and financing activities:
Amounts in thousands:
<CAPTION>
December 31,
1999 1998
<S> <C> <C>
Equipment acquired by direct
financing $ 4,763 $ -
Long-term debt payments directly
financed $ 321 $ 1,560
Lease payments directly financed $ 104 $ 422
</TABLE>
<PAGE>
UNION PLAZA HOTEL AND CASINO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 16 - RECLASSIFICATION OF ITEMS
Certain items on the financial statements as of December 31, 1998 and
1997 have been reclassified to be consistent with the classification as
of December 31, 1999.
During the years ended December 31, 1998 and 1997, cash in currency
acceptors totaling $299,000 and $226,000 respectively, were reclassified
from accounts receivable to cash and cash equivalents. In addition,
gain on sale of assets of $3,000 for the years ended December 31, 1998
and 1997 were reclassified from other revenue to a separate caption
under other income (expense). These changes had no effect on net
income for the years ended December 31, 1998 and 1997.
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS
Directors
John D. Gaughan Chairman of the Board
J.K. Houssels Vice Chairman of the Board
Donald L. Dobson Director
Larry Dolesh Director
John P. Jones Director
Michael Nolan Director
Irving K. Epstein Director
Executive Officers
John D. Gaughan Chief Executive Officer
President
Donald L. Dobson Vice President/Corporate
Secretary
John P. Jones Vice President/Treasurer
Larry Dolesh Vice President
Michael Nolan Vice President
Joe Woody Controller
<PAGE>
SPECIAL INFORMATION
SCOPE OF OPERATIONS
The Company operates the Union Plaza Hotel and Casino (Union Plaza) resort
complex in downtown Las Vegas, Nevada.
The casino facilities offer a variety of games which generate approximately
58% of the gross revenue of the Company. The major games of chance featured
by the Company's casino include craps, card room, blackjack ("21"), keno, slot
machines, race and sports book, roulette, baccarat and pai gow poker.
The food and beverage facilities account for approximately 18% of the
Company's gross revenues. The room operation provides approximately 20% of
gross revenue with retail shops, subleases, vending, interest on
investments, and miscellaneous gains on the sale of assets accounting for
the remaining 4%.
FORM 10-K
A copy of the Company's Annual Report of Form 10-K, as filed with the
Securities and Exchange Commission, will be furnished without charge to any
stockholder upon written request to Mr. John D. Gaughan, President, Union
Plaza Hotel and Casino, Number One Main Street, P.O. Box 760, Las Vegas,
Nevada 89125.
ANNUAL STOCKHOLDERS' MEETING
The annual meeting of Union Plaza Hotel and Casino, Inc. will be held on
May 19, 2000, at the Center Stage Restaurant, Number One Main Street, Las
Vegas, Nevada.
DIVIDENDS AND MARKET PRICE STATISTICS OF COMMON STOCK
The Company's stock is not traded on any securities exchange. A dividend
of $.10 per share was paid to the stockholders of record on the shares of
common stock outstanding on the last day of each quarter during 1981 and
1980. No dividends have been declared or paid since 1981.
AUDITORS
The Company's auditors are Conway, Stuart & Woodbury, CPA's, 4021 Meadows
Lane, Las Vegas, Nevada 89107.
This report is prepared for the information of stockholders,
employees, and other interested persons. It is not
transmitted in connection with the sale of any security or
offer to sell or offer to buy any security.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 3250000
<SECURITIES> 0
<RECEIVABLES> 519000
<ALLOWANCES> 0
<INVENTORY> 348000
<CURRENT-ASSETS> 4927000
<PP&E> 107036000
<DEPRECIATION> 69526000
<TOTAL-ASSETS> 43278000
<CURRENT-LIABILITIES> 8254000
<BONDS> 28754000
0
0
<COMMON> 750000
<OTHER-SE> 4387000
<TOTAL-LIABILITY-AND-EQUITY> 43278000
<SALES> 9709000
<TOTAL-REVENUES> 55145000
<CGS> 14387000
<TOTAL-COSTS> 27189000
<OTHER-EXPENSES> 10721000
<LOSS-PROVISION> 24000
<INTEREST-EXPENSE> 2493000
<INCOME-PRETAX> (3561000)
<INCOME-TAX> ( 394000)
<INCOME-CONTINUING> (3167000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3167000)
<EPS-BASIC> ( 4.18 )
<EPS-DILUTED> ( 4.18 )
</TABLE>
