Company posts loss on quarter

Wednesday, Feb. 6, 2002 | 9:21 a.m.

Lakes Gaming Inc. of Minneapolis reported a sizable loss for the quarter ending Dec. 30, the result of a loss posted from the sale of a Strip land parcel.

Lakes reported a loss of $13.4 million, or $1.26 per share, for its fourth quarter. This compares to a loss of $104,000, or 1 cent per share, in the year-ago period.

Revenue rose 11 percent to $7.4 million, while earnings from operations fell 48 percent to $2.5 million.

The quarter included a $17.2 million after-tax loss from Lakes' sale of its Polo Plaza Shopping Center property on the Strip, as well as the sale of rights to the adjacent Travelodge and the write-down of Lakes' Shark Club site to market value. These properties were sold to development company Metroflag Polo LLC -- a company partly owned by Las Vegas developer Brett Torino -- for $31.8 million. Lakes also took a $400,000 charge from the write-off of investments "in the development of various new casino game concepts."

Without these charges, Lakes would have posted net income of $4.2 million, or 39 cents per share.

Lakes' sole source of revenue was the Grand Casino Coushatta in Louisiana. Its management contract for this tribal casino expired on Jan. 16, 2002. However, the company currently has agreements with four separate tribes to develop and operate casinos in Michigan, California and an unspecified site on the East Coast. It also has entered into a joint venture with MRD Gaming to develop and operate a third California tribal casino.