LAS VEGAS, July 24, 2003—Park Place Entertainment Corporation (NYSE: PPE) today reported financial results for the quarter and six months ended June 30, 2003.
For the second quarter of 2003, Park Place reported net income of $41 million, or $0.14 per diluted share. That compares to net income of $96 million, or $0.31 per diluted share, for the second quarter of 2002.
Adjusted net income for the second quarter of 2002 was $57 million, or $0.19 per diluted share, excluding a one-time investment gain. The $39 million gain, net of tax, resulted from the sale of the company`s equity interest in Jupiters Limited, an Australian casino company. The company did not record any non-recurring items in the second quarter of 2003.
Net revenue for the second quarter of 2003 was $1.187 billion, compared to $1.192 billion in the second quarter of 2002. Second quarter EBITDA - earnings before interest, taxes, depreciation and amortization and investment gain - was $277 million, down from $310 million in the year-ago quarter.
Net income for the first half of 2003 was $82 million - or $0.27 per diluted share - including $1 million in pre-opening expense recorded in the first quarter. That compares to net income before the cumulative effect of the goodwill accounting change of $136 million - or $0.45 per diluted share - for the first half of 2002, including the one-time investment gain.
Excluding the one-time investment gain and the effect of the goodwill accounting change, adjusted net income for the first half of 2002 was $97 million, or $0.32 per diluted share.
Including the effect of the accounting change, which was related to the adoption of Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets,” the company reported a net loss of $(843) million, or $(2.76) per diluted share, for the first half of 2002.
Net revenue for the first half of 2003 was $2.330 billion, approximately equal to the $2.335 billion in net revenue reported for the first half of 2002. EBITDA for the first half of 2003 was $551 million, compared to $589 million for the first half of 2002.
“The company had a solid recovery from a difficult April - a month impacted by the war in Iraq, SARS fears and the uncertain national economy - with a better than expected May and a steady June,” said Park Place President and Chief Executive Officer Wallace R. Barr.
“In the quarter, we showed strength in our Eastern and Mid-South regions. In the West, we were hurt by a travel slump in April and by low table hold throughout the quarter. However, Caesars Palace reported increasing volumes and improving trends in other key metrics. The Palace reported record cash room rates in every month of the quarter and The Colosseum continued to drive increased visitor traffic and revenue.
“As we move into the second half of the year, we`ll continue to focus on controlling expenses so that we can maximize earnings from any improvements in revenue,” Barr added. “Looking further into the future, we are very excited about opportunities to capitalize on the strength of our Caesars brand. Our recently announced plan to change the name of the company to Caesars Entertainment is a clear statement of our belief in the strength of that name.”
Further details at www.parkplace.com