Park Place Entertainment Corporation (NYSE: PPE) today reported results for the fourth quarter and full year 1999.
Capping an outstanding first year as an independent company, Park Place’s diluted earnings per share for the quarter were $0.11 versus pro forma results of $0.05 last year, excluding one-time, non-cash asset write-downs in 1999 and 1998. Including these non-recurring charges in both periods, diluted earnings per share in the fourth quarter of 1999 were $0.05 versus $0.02 in 1998.
The Company initiated reporting cash earnings (net income before goodwill amortization associated with its acquisitions) as it believes the cash earnings measure provides additional insight into Park Place’s earnings potential. Cash earnings per share increased 75 percent in the fourth quarter to $0.14 versus $0.08, excluding the non-recurring charges.
Earnings before interest, taxes, depreciation and amortization, pre-opening expenses and non-cash items (EBITDA) increased 39 percent to $193 million compared to the pro forma fourth quarter 1998 results of $139 million.
EBITDA increased in all three domestic regions primarily due to the successful opening of the Paris Las Vegas Casino Resort in September, the new rooms opened earlier in the year in Mississippi, the continued success of various domestic and international marketing efforts and the ongoing implementation of cost saving programs at the property and corporate level.
Highlights from 1999 include:
* Establishing Park Place as a stand-alone company.
* Acquiring and integrating Grand Casinos, immediately making Park Place the leading operator in Mississippi.
* Opening the 600-room Terrace Hotel & Spa at Grand Tunica in March and the 600-room Oasis Resort and Spa at Grand Gulfport in June.
* Raising $3 billion in bank financing (the largest ever in the gaming industry) to close the Caesars acquisition.
* Opening the fully operational Paris Las Vegas Casino Resort on September 1. Based on results since opening, Park Place believes Paris may earn the highest return on investment of all the gaming properties built in 1998 and 1999 in Las Vegas.
* Closing the $3 billion Caesars World acquisition on December 29, enhancing Park Place’s leadership position in the industry. The acquisition enhances the Company’s diversification and portfolio of leading assets, as well as giving it access to one of the most internationally recognized names in the gaming business.
* Increasing full year diluted earnings per share by 22 percent, excluding non-recurring charges, and EBITDA by 14 percent through same-store revenue growth, as well as new development.
“We are very proud of our accomplishments in our first year and look forward to continuing the momentum in 2000,” said Arthur Goldberg, president and CEO. “We are working towards integrating Caesars and implementing processes and procedures that improve the product we deliver to our customers while simultaneously optimizing operating efficiency.”