SOURCE: Global Casinos, Inc.

March 03, 2010 08:00 ET

Global Casinos Reports Second Quarter Financial Results

BOULDER, CO--(Marketwire - March 3, 2010) - Global Casinos, Inc. (OTCBB: GBCS) today announced financial results for its second quarter and six-month period ended December 31, 2009.

Second quarter net revenue was $1,333,000 versus $1,510,000 in the second quarter of fiscal 2009. The decline is attributable to poor weather conditions and continued weak consumer spending.

The Company reported a loss from operations of $266,000 versus a loss from operations of $104,000 in last year's second quarter. The increased operating loss was the result of lower revenue, increased stock-based compensation expense and increased fees associated with the Company's debt restructuring efforts. These increased expenses were partially offset by a $102,000 reduction in casino operating expenses. Net loss attributable to common shareholders was $340,000, or $0.06 per diluted share, versus a net loss attributable to common shareholders of $164,000, or $0.03 per diluted share, in the second quarter a year ago.

Operating cash flow at the six-month mark was $163,000, up from $140,000 during the same period last year.

Cliff Neuman, president and CEO, "The second fiscal quarter is traditionally one of our slowest periods due to the seasonal nature of Colorado's mountain-based gaming industry. Challenging weather conditions along Colorado's Front Range only exacerbated the annual slowdown in customer traffic."

"As we anticipate the busier Spring and Summer seasons, as well as a rebound in consumer spending, we continue to focus on enhancing efficiencies at our Bull Durham and Doc Holliday properties," Neuman added. "These efforts drove down casino operating expenses by nearly 6% versus last year's second quarter. We also have made important progress on our debt restructuring efforts, which is encouraging given the extremely tight credit markets. We are optimistic these ongoing efforts will ultimately have a material positive impact on our cost structure and earnings potential."

Year-to-date results

Net revenue through the first six months of fiscal 2010 was $3,014,000 versus $3,180,000 in the same period last year. Loss from operations was $83,000 versus an operating loss of $75,000 at the six-month mark last year. Net loss attributable to common shareholders was $209,000, or $0.03 per diluted share, versus a net loss attributable to common shareholders of $193,000, or $0.03 per diluted share, in the same period last year.

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, 2009.

 
                  GLOBAL CASINOS, INC. AND SUBSIDIARIES                    
                  CONSOLIDATED STATEMENTS OF OPERATIONS                    
          for the three months ended December 31, 2009 and 2008            
       
                                                      2009         2008
                                                  -----------  ----------- 
Revenues:
  Casino                                          $ 1,368,809  $ 1,547,593
  Promotional allowances                              (36,006)     (37,767)
                                                  -----------  ----------- 
    Net Revenues                                    1,332,803    1,509,826
Expenses:
  Casino operations                                 1,434,364    1,536,430
  Operating, general, and administrative              164,581       75,402
  Loss on asset disposals                                   -        1,643
                                                  -----------  ----------- 
                                                    1,598,945    1,613,475
Income (loss) from operations                        (266,142)    (103,649)
Other income (expense):
  Interest                                            (59,190)     (40,607)
  Equity in earnings of Global Gaming
   Technologies                                             -       (5,485)
                                                  -----------  ----------- 
Income (loss) before provision for income taxes      (325,332)    (149,741)
  Provision for income taxes                                -            -
                                                  -----------  ----------- 
Net income (loss)                                    (325,332)    (149,741)
Series D Preferred dividends                          (14,311)     (14,311)
                                                  -----------  ----------- 
Net income (loss) attributable to common
 shareholders                                     $  (339,643) $  (164,052)
                                                  ===========  =========== 
Earnings (loss) per common share:
  Basic                                           $     (0.06) $     (0.03)
                                                  ===========  =========== 
  Diluted                                         $     (0.06) $     (0.03)
                                                  ===========  =========== 

Weighted average shares outstanding:
  Basic                                             6,059,855    5,955,215
                                                  ===========  =========== 
  Diluted                                           6,059,855    5,955,215
                                                  ===========  =========== 



                  GLOBAL CASINOS, INC. AND SUBSIDIARIES                    
                  CONSOLIDATED STATEMENTS OF OPERATIONS                    
            for the six months ended December 31, 2009 and 2008            

                                                      2009         2008
                                                  -----------  ----------- 
Revenues:
  Casino                                          $ 3,090,071  $ 3,257,358
  Promotional allowances                              (76,210)     (76,909)
                                                  -----------  ----------- 
    Net Revenues                                    3,013,861    3,180,449
Expenses:
  Casino operations                                 2,896,915    3,074,351
  Operating, general, and administrative              200,290      178,139
  Loss on asset disposals                                   -        2,743
                                                  -----------  -----------
                                                    3,097,205    3,255,233
Income (loss) from operations                         (83,344)     (74,784)
Other income (expense):
  Interest                                            (96,543)     (82,654)
  Equity in earnings of Global Gaming
   Technologies                                             -       (6,683)
                                                  -----------  ----------- 
Income (loss) before provision for income taxes      (179,887)    (164,121)
  Provision for income taxes                                -            -
                                                  -----------  ----------- 
Net income (loss)                                    (179,887)    (164,121)
Series D Preferred dividends                          (28,622)     (28,622)
                                                  -----------  ----------- 
Net income (loss) attributable to common
 shareholders                                     $  (208,509) $  (192,743)
                                                  ===========  =========== 
Earnings (loss) per common share:
  Basic                                           $     (0.03) $     (0.03)
                                                  ===========  =========== 
  Diluted                                         $     (0.03) $     (0.03)
                                                  ===========  =========== 
Weighted average shares outstanding:
  Basic                                             6,040,536    5,925,867
                                                  ===========  =========== 
  Diluted                                           6,040,536    5,925,867
                                                  ===========  =========== 



                  GLOBAL CASINOS, INC. AND SUBSIDIARIES                    
                        CONSOLIDATED BALANCE SHEETS                        

                                      December 31, 2009    June 30, 2009
                                      -----------------  ----------------- 
             ASSETS
Current Assets
  Cash and cash equivalents           $         813,770  $       1,378,074
  Accrued gaming income                         225,217            190,516
  Inventory                                      21,464             19,309
  Prepaid expenses and other current
   assets                                        98,034            100,791
                                      -----------------  ----------------- 
      Total current assets                    1,158,485          1,688,690

Land, building and improvements, and
 equipment:
  Land                                          517,950            517,950
  Building and improvements                   4,128,021          4,121,308
  Equipment                                   3,151,918          3,192,703
                                      -----------------  ----------------- 
    Total land, building and
     improvements, and equipment              7,797,889          7,831,961
  Accumulated depreciation                   (4,555,214)        (4,393,514)
                                      -----------------  ----------------- 
  Land, building and improvements,
   and equipment, net                         3,242,675          3,438,447

Goodwill                                      1,898,496          1,898,496
                                      -----------------  ----------------- 
Total assets                          $       6,299,656  $       7,025,633
                                      =================  ================= 
 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable, trade             $         137,864  $         140,541
  Accounts payable, related parties              16,003             18,507
  Accrued expenses                              353,723            360,774
  Accrued interest                                4,309              6,720
  Joint venture obligation                       25,850             25,850
  Current portion of long-term debt           1,167,366          2,038,068
  Current portion of loan
   participation obligations                     25,638                  -
  Other                                         333,698            252,578
                                      -----------------  ----------------- 
      Total current liabilities               2,064,451          2,843,038
Long-term debt, less current portion                  -                  -
Loan participation obligations, less
 current portion                                237,449                  -
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;
   6,095,488 and 5,955,215 shares
   issued and outstanding                       304,775            297,761
  Additional paid-in capital                 13,998,849         14,010,815
  Accumulated deficit                       (11,406,868)       (11,226,981)
                                      -----------------  ----------------- 
Total equity                                  3,997,756          4,182,595
                                      -----------------  ----------------- 
Total liabilities and stockholders'
 equity                               $       6,299,656  $       7,025,633
                                      =================  ================= 

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