SOURCE: Global Casinos, Inc.

Global Casinos, Inc.

February 18, 2009 08:00 ET

Global Casinos Reports 69% Increase in Second Quarter Net Revenue

Year-to-Date Net Revenue Up 78%

BOULDER, CO--(Marketwire - February 18, 2009) - Global Casinos, Inc. (OTCBB: GBCS) today announced financial results for its fiscal second quarter ended December 31, 2008.

Net revenue increased 69% to $1,510,000 from $892,000 in the second period last year. The increase was the result of Global's March 2008 acquisition of the Doc Holliday Casino, as well as a quarter-over-quarter increase in revenue from Global's flagship Bull Durham Casino. The Company reported a second quarter operating loss of $102,000 versus operating income of $87,000 in the year-ago second quarter. The decline is largely attributable to increased expenses associated with the addition of the Doc Holliday operations. Management is currently implementing a variety of new marketing strategies, floor operations and customer loyalty programs designed to enhance the performance of the Doc Holliday property.

Global reported a second-quarter net loss attributable to common shareholders of $164,000, or $0.03 per diluted share, versus net income attributable to common shareholders of $63,000, or $0.01 per diluted share, in the second quarter last year. The net loss attributable to common shareholders resulted from the operating results of the Doc Holliday Casino, the payment of a preferred stock dividend and increases in the Company's corporate expenses.

Through six months, net revenue increased 78% to $3,180,000 from $1,787,000 in the comparable prior-year period. Global reported a loss from operations of $72,000 versus income from operations of $168,000 in the comparable prior-year period. Net loss attributable to common shareholders was $193,000, or $0.03 per diluted share, versus net income of $122,000, or $0.02 per diluted share, at the six-month mark last year. At December 31, 2008, Global reported operating cash flow of $140,000.

Clifford L. Neuman, president, said, "Year-to-date revenue at our core Bull Durham casino was up nearly 7 percent versus the same period in fiscal 2008. This growth was achieved in spite of softness in the gaming industry and a weak overall economy, and it illustrates the continued success of our marketing and customer loyalty programs at Bull Durham. We hope to make significant investments in similar programs at Doc Holliday during the coming year. In addition, the voter-authorized increase in wager limits, expanded hours of casino operations and addition of craps and roulette as approved games will go into effect on July 2. We are optimistic these changes will bring significant benefits to Colorado's gaming market, and attract a much larger customer base."

About Global Casinos, Inc.

Global Casinos, Inc. owns and operates the Bull Durham Saloon and Casino and Doc Holliday Casino, located in Colorado's limited stakes gaming districts of Black Hawk and Central City, respectively.

Safe Harbor Statement

Certain statements in this news release that are not historical facts are forward-looking statements, such as statements relating to anticipated enhancements in the Company's financial performance, and future development or expansion activities. Such forward-looking statements involve a number of risks and uncertainties that may significantly affect performance and financial results in the future and, accordingly, actual results may differ materially from those expressed in any forward-looking statements. Such risks and uncertainties include, but are not limited to, those related to effects of competition, leverage and debt service financing and refinancing efforts, general economic conditions, changes in gaming laws or regulations (including the legalization of gaming in various jurisdictions), risks related to development and construction activities, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-KSB for the year ended June 30, 2008.


                  GLOBAL CASINOS, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS
          for the three months ended December 31, 2008 and 2007


                                                   2008           2007
                                               ------------   ------------

Revenues:
  Casino                                       $  1,547,593   $    930,251
  Promotional allowances                            (37,767)       (38,344)
                                               ------------   ------------
    Net Revenues                                  1,509,826        891,907

Expenses:
  Casino operations                               1,536,430        762,990
  Operating, general, and administrative             75,402         42,076
                                               ------------   ------------
                                                  1,611,832        805,066

Income (loss) from operations                      (102,006)        86,841

Other income (expense):
  Interest                                          (40,607)       (19,127)
  Equity in earnings of Global Gaming
   Technologies                                      (5,485)        (4,533)
  Loss on asset disposals                            (1,643)             -
                                               ------------   ------------

Income (loss) before provision for income
 taxes                                             (149,741)        63,181
  Provision for income taxes                              -              -
                                               ------------   ------------

Net income (loss)                                  (149,741)        63,181

Series D Preferred dividends                        (14,311)             -
                                               ------------   ------------
Net income (loss) attributible to common
 shareholders                                  $   (164,052)  $     63,181
                                               ============   ============

Earnings (loss) per common share:
  Basic                                        $      (0.03)  $       0.01
                                               ============   ============
  Diluted                                      $      (0.03)  $       0.01
                                               ============   ============

Weighted average shares outstanding:
  Basic                                           5,955,215      5,202,907
                                               ============   ============
  Diluted                                         5,955,215      5,290,311
                                               ============   ============




                  GLOBAL CASINOS, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS
            for the six months ended December 31, 2008 and 2007


                                                   2008           2007
                                               ------------   ------------

Revenues:
  Casino                                       $  3,257,358   $  1,863,225
  Promotional allowances                            (76,909)       (76,651)
                                               ------------   ------------
    Net Revenues                                  3,180,449      1,786,574

Expenses:
  Casino operations                               3,074,351      1,519,628
  Operating, general, and administrative            178,139         98,661
                                               ------------   ------------
                                                  3,252,490      1,618,289

Income (loss) from operations                       (72,041)       168,285

Other income (expense):
  Interest                                          (82,654)       (39,892)
  Equity in earnings of Global Gaming
   Technologies                                      (6,683)        (6,222)
  Loss on asset disposals                            (2,743)             -
                                               ------------   ------------

Income (loss) before provision for income
 taxes                                             (164,121)       122,171
  Provision for income taxes                              -              -
                                               ------------   ------------

Net income (loss)                                  (164,121)       122,171

Series D Preferred dividends                        (28,622)             -
                                               ------------   ------------
Net income (loss) attributible to common
 shareholders                                  $   (192,743)  $    122,171
                                               ============   ============

Earnings (loss) per common share:
  Basic                                        $      (0.03)  $       0.02
                                               ============   ============
  Diluted                                      $      (0.03)  $       0.02
                                               ============   ============

Weighted average shares outstanding:
  Basic                                           5,925,867      5,202,907
                                               ============   ============
  Diluted                                         5,925,867      5,290,666
                                               ============   ============




                  GLOBAL CASINOS, INC. AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS


                                               December 31,     June 30,
                                                   2008           2008
                                               ------------   ------------
                   ASSETS

Current Assets
  Cash and cash equivalents                    $  1,020,875   $  1,163,416
  Accrued gaming income                             318,006        219,821
  Inventory                                          21,415         16,469
  Prepaid expenses and other current assets          47,495         92,972
                                               ------------   ------------
       Total current assets                       1,407,791      1,492,678

Acquisition escrow deposit                                -              -

Investment in Global Gaming Technologies             54,164         60,847

Land, building and improvements, and
 equipment:
  Land                                              517,950        517,950
  Building and improvements                       4,121,308      4,121,308
  Equipment                                       3,063,233      3,057,670
                                               ------------   ------------
    Total land, building and improvements,
     and equipment                                7,702,491      7,696,928
  Accumulated depreciation                       (4,113,364)    (3,900,633)
                                               ------------   ------------
  Land, building and improvements, and
   equipment, net                                 3,589,127      3,796,295

Goodwill                                          1,898,496      1,898,496

Total assets                                   $  6,949,578   $  7,248,316
                                               ============   ============

     LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable, trade                        $    136,786   $     75,196
Accounts payable, related parties                    13,658         68,332
Accrued expenses                                    334,102        359,461
Accrued interest                                      6,361          6,390
Joint venture obligation                             30,000         30,000
Current portion of long-term debt                 2,116,788        589,581
Other                                               253,786        254,105
                                               ------------   ------------
       Total current liabilities                  2,891,481      1,383,065

Long-term debt, less current portion                      -      1,659,411

Commitments and contingencies

Stockholders' equity:
Preferred stock: 10,000,000 shares authorized
  Series A - no dividends, $2.00 stated
   value, non-voting,
     2,000,000 shares authorized, 200,500
      shares issued and outstanding                 401,000        401,000
  Series B - 8% cumulative, convertible,
   $10.00 stated value, non-voting,
     400,000 shares authorized, no shares
      issued and outstanding                              -              -
  Series C - 7% cumulative, convertible,
   $1.20 stated value, voting
     600,000 shares authorized, no shares
      issued and outstanding                              -              -
  Series D - 8% cumulative, convertible,
   $1.00 stated value, non-voting
     1,000,000 shares authorized, 700,000
      shares issued and outstanding                 700,000        700,000
Common stock - $0.05 par value; 50,000,000
 shares authorized;
     5,955,215 and 5,865,215 shares issued
      and outstanding                               297,761        293,261
Additional paid-in capital                       14,038,971     14,027,093
Accumulated deficit                             (11,379,635)   (11,215,514)
                                               ------------   ------------
Total equity                                      4,058,097      4,205,840
                                               ------------   ------------

Total liabilities and stockholders' equity     $  6,949,578   $  7,248,316
                                               ============   ============

Contact Information

  • CONTACTS:

    Clifford L. Neuman
    President and CEO
    Global Casinos, Inc.
    303-449-2100

    Geoff High
    Principal
    Pfeiffer High Investor Relations, Inc.
    303-393-7044