Isle of Capri sustains loss in first quarter

With five casinos closed for extended periods due to flooding this summer, Isle of Capri saw earnings losses in the first quarter of fiscal year 2012.

Isle lost $2.3 million, or 6 cents per share, in the quarter compared to a loss of $2.7 million, or 8 cents per share, in the same period last year, the company reported Thursday. Industry analysts had anticipated earnings of 8 cents per share.

"This quarter clearly contains numerous outside factors that make it difficult to compare our progress to prior year," said Virginia McDowell, Isle president and CEO.

The company estimates the impact of flooding to be more than $7 million; however, flood insurance is expected to cover the physical property damage and interruption to business.

Isle's Lady Luck Casino in Caruthersville, Mo., was closed for 12 days and its casinos farther south along the Mississippi River were closed even longer. Its Lula, Miss., property was closed for 31 days, and a portion of the casino operations remain closed as flood damage is repaired. Its Natchez, Miss., casino was closed for 41 days and its Vicksburg casino was closed for 16 days. Further north, its Davenport, Iowa, casino was closed for six days.

In addition to the days closed, the properties did not operate at normal levels for some time before or after their closure, McDowell said.

Another factor influencing revenue is continued high unemployment and consumer uncertainty about the economy.

"People are scared, and that is certainly reflected in our business," McDowell said. "This volatility is not a trend; it's something we're seeing on a weekly basis."

However, with the exception of its Lula casino, McDowell said she's pleased with the performance of Isle's properties.

At casinos not affected by flooding, net revenue rose 2.7 percent.

Also this quarter, the company trimmed its expenses by $200,000 compared to the same period last year. Isle announced that construction of its Cape Girardeau casino is proceeding on time and on budget, with the facility expected to open in late 2012.

The company had capital expenditures of $14.6 million during the quarter, $4.1 million related to its Cape Girardeau construction project.

Isle of Capri, based in St. Louis, has 15 casinos.

mmiller@semissourian.com

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