Isle Of Capri Conference Call Highlights

Isle Of Capri

reported its third quarter earnings on Monday. Shares of the company are up 5%. Below are some key highlights from its conference call: Growth and Performance Prospects: • Net revenues were $239 million, an increase of 3% from $232 million in the prior year. • Our flow-through for the quarter was 87% as better revenue performance came through on a relatively flat cost structure due to the continued efforts on our profit improvement program. • There were a few items in the quarter that impacted our earnings and are excluded from consolidated adjusted EBITDA. • These include $1.2 million favorable property tax settlement in Waterloo where we contested our assessment. • We also spent $3 million in expenses related to the referendum Amendment 68 in Colorado. • We had a litigation accrual reversal of $14.7 million, which reduced the operating expenses by $7.3 million and interest expense by $7.4 million. • During the quarter, 10 of our properties generated increased net revenues driven by an improvement in the macro environment and more importantly the continued refinements we have made to our marketing programs. • 10 of our properties reported an increase in EBITDA, while 11 reported higher EBITDA margins. • Five properties reported year-over-year EBITDA gains of greater than 25% including Black Hawk, Vicksburg, Lula, Cape Girardeau and Caruthersville while Nemacolin cut its operating loss by nearly $1 million in the quarter. • Excluding non-recurring items, corporate and development expense was down 8.8% year-over-year, as we continue to manage expenses here at St. Louis. • Adjusting for the litigation reversal in the prior year, interest expense was lower year-over-year primarily as a result of lower borrowings on our credit facility. • At the end of the quarter, we had $1.03 billion in total debt, our revolver balance was $33 million relative to approximately $65 million at the end of our fiscal fourth quarter 2014. • During the quarter, we repaid approximately $22 million in revolver borrowings, we also had $1 billion in bonds outstanding. • Our growth leverage was less than 6 times based on adjusted EBITDA for the first time in the past six quarters. • Our leverage for covenant purposes in our bank facility was 6 times and we had $178 million in available capacity on our revolver. • On October 29, we amended the definition of consolidated EBITDA in our credit facility to allow for the add back of the $2.3 million in severance we reported in fiscal first quarter and the $4.1 million in expenses related to the Colorado referendum. • Had the amendment been in place at the end of our fiscal 2Q, our revolver capacity would have been approximately $45 million greater. • Additionally, subsequent to the end of the quarter, the Pennsylvania Gaming Control Board made a decision with respect to the final gaming license in Philadelphia. • Our proposed project with Tower Entertainment was not chosen. • As such, the PGCB has returned our $25 million letter of credit that we had posted to secure our obligations and we are in the process of unwinding our other agreements with Tower Entertainment.