Hedgeye - ISLE YOUTUBE

In preparation for ISLE's F2Q 2013 earnings release Thursday, we’ve put together the recent pertinent forward looking company commentary.

Isle of Capri Casinos, Inc. Opens Isle Casino Cape Girardeau (10/31)

YOUTUBE FROM F1Q 2013 CONFERENCE CALL

"While we've been able to mitigate the economic issues at most of the properties in the portfolio through our continuing cost containment measures, our results in Pompano and Kansas City were impacted by an increasing competitive environment."
"We also continue to experience construction disruption in Vicksburg and Lake Charles as we focus on asset renewal, and by road construction in Black Hawk."
"We received good news from the Supreme Court in Pennsylvania last week and are finally looking forward to starting construction of our Lady Luck property at the Nemacolin Woodlands Resort in Western Pennsylvania. At the point that we're able to do so, it will be 9 to 12 months before our flagship Lady Luck welcomes our first guests."
"Shortly after the end of the quarter, we completed the refinancing of the 7% subordinated notes which were due in 2014 with a new subordinated debt issue due 2020. Our nearest maturity is now 2016. Related to this refinancing, we will incur charges of approximately $3 million in the second quarter on the underwriting discounts and various fees related to the financing."
"Interest expense for the balance of the year is now expected to be approximately $66 million."
[Midwest] "I can't specifically say we're seeing it related to the drought; we have seen a pullback just like the rest of the group has, probably since the end of the first calendar quarter. So I can't pinpoint anything specifically to the drought or farming."

"You don't know how many people sold forward. And then the other thing is, to the extent that there is yield in the fields, the corn is at pretty live prices right now. So how all that balances out, I think it's really going to be into the fall before we know the full impact."

[Florida] "There is promotional war right now they started out when they opened with two to three promotional mail offers a month, now they're up to 10 to 12. So they are up over 300% just with their mailing to their customers and that's what we're facing."
[Depreciation guidance of $76-78MM for FY 2013] "We're still on target for what we expected for the 12 months."
[Annual corporate cost run rate] "$40 million (includes $6 million of stock comp)."
[$50 million maintenance capex guidance] "We've been running in the $40 million to $50 million range in any given year. I think that that's probably a pretty good number."

"We're comfortable with where the slot floor is now. We're up to speed at all of our properties or most of our properties where the slot floor needs to be."

[Lake Charles] "But we do expect the margins to increase. We started the fan club in the quarter, we have some additional expenses there with some comp reserves that we left because they are such heavy table play in that market that we made a decision to leave some comp residual in their accounts. So we're tweaking all of that along with our marketing spend and our labor to find to your point where we really need to be post-Crown and where that labor and marketing needs to settle in."
"I think the issue in Mississippi right now is really being driven by Lula. We are continuing to modify the way we act at the property. The way we market the property down there and operate to kind of find the right mix on this volume, but you know, we really just have seen what I believe now
appears to be kind of a permanent diminution in that market."
"In Vicksburg, we're under some pretty heavy construction disruption right now with – redoing our casino floor and some of the couple of the restaurant products there. The re-branding there that's getting done and the renovations have had a pretty good impact on the property in the quarter. And that should start to subside as this stuff finishes up later this year."
[New Black Hawk competitor] "We've had a great communication with them in terms of just moving forward as our neighbor. We installed a new sign. We got their permission to put up a big truck in middle of the road to kind of impact what they did for a week. Everything we've done with them has been positive, but we haven't seen any promotional challenges or anything that would cause us any concern."
[Black Hawk improving margins] "I think we're seeing good results from the hotel rooms that we've been able to refurbish. And so I think we've been up against some pressure with the rest of the market. Instead of being the first stop with the highway construction, we became the last stop as traffic got rerouted. And I think our marketing promotions have been developed in such a way that they take into account people that show up rather than a sunk cost for promotion. So, I think we've tailored a lot of what we did this quarter in a more efficient way, better yielding in the hotel, better food product, able to raise some prices in our buffet and things like that. So, I think we've been able to overcome that along with a tax increase July 1."