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"We believe the signs of stabilization that were evident at most of our properties in the third quarter will continue into the 2010 fourth quarter. Year-over-year quarterly variances are expected to narrow at our Black Hawk and East Chicago properties. The positive impact from the Black Hawk hotel will be fully included in the final quarters of 2010 and 2009. During the fourth quarter, we will also lap the November 2009 East Chicago bridge closure and its adverse impact on that property's financial results... Also, our St. Charles property appears to have stabilized in all key financial metrics, as well as admissions and market share, since the opening of a new competitor in March 2010... We are optimistic the combination of solid net revenues and consistently strong margins should continue to produce efficient revenue flow-through."

--Gordon Kanofsky, CEO of Ameristar


  • Impact of East Chicago bridge closure: $4.6MM of revenue and $2.5MM of EBITDA
  • Promotional allowances rose 15.6% due to Black Hawk hotel and marketing post-bridge closure at East Chicago.
  • "The declines in operating income, Adjusted EBITDA and the related margin are primarily attributable to lower table games hold percentages at our Vicksburg and Missouri properties. We believe that table hold variances accounted for approximately $2.8 million of the decline in Adjusted EBITDA and a drop of 0.9 percentage point in Adjusted EBITDA margin compared to the prior-year third quarter."
  • Debt: $1.57BN; intends to repay all 2010 debt with cash from ops and revolver
  • Total leverage ratio: 4.81x (covenant: 6x)
  • Senior leverage ratio: 4.81x (covenant: 6x)
  • Interest expense: $28.1 MM
  • Capitalized interest: $0.2MM
  • Capex: $14.1 MM, down from $33.3 in 3Q 2009
  • Dividend: $0.105 per share
  • FY 2010 guidance
    • depreciation: $108.2-$109.2 MM
    • interest expense, net: $122.5- $123.5 MM (includes non-cash interest expense of $11MM)
    • Combined state and federal tax rate: 43.5%-44.5%
    • Capex: $65-$70MM
    • Capitalized interest: $0.6 MM-$0.7 MM
    • Non-cash stock comp: $13.8 MM-$14.3 MM


  • First time in 2 years that they didn't see net revenues decline
  • Optimistic that most markets have bottomed out and that they will start seeing some increases
  • Market share in Blackhawk reached a record of 27.8% and they grew 9% YoY despite the market declining 2.4%
  • 3Q is probably a good indicator of what East Chicago can generate going forward
  • Cape Girdardeau got strong local support. They are going to make a decision on whether and where to issue a license by year end.


  • How was October? Don't usually comment but October results have continued along the trends they have been experiencing.  There are 5 weekends in October.
  • Adding 106 rooms at Kansas City and making some renovations. Will use their FCF to reduce debt.  Hopefully when topline grows, the flow-through will be strong.
  • Will look at new opportunities and whether to pursue them depends on whether they are better on debt reduction and projects at existing properties
  • Why the huge growth in F&B revenues?
    • They had to respond when competition ramped up promotions. It ended up benefiting their slot margins (increased play)
  • Market shrare is 43.5% of Vicksburg market
  • 2011 Capex plan?
    • Roughly the same as 2010 - give or take $5MM
    • Will start additional rooms in Kansas City but it won't be complete
    • Room rehab in East Chicago
    • For the most part, it will be maintenance related
    • No change on slot replacement/ conversions
  • Can adjust to business levels without significant staffing increases. Should see extremely high flow-through from net revenue increases
  • Extending R/C is L+ 375bps piece
  • Capex this quarter? Almost all maintenance
  • There will be some payment in the quarter to finish off Blackhawk