Gaming briefs for Nov. 17, 2003

Monday, Nov. 17, 2003 | 11:14 a.m.

LV supplier's loss widens

Paul-Son Gaming Corp. Friday reported a loss of $701,000 in the third quarter compared to a loss of $564,000 in the same quarter of last year.

Third-quarter revenue at the Las Vegas company, which makes casino chips, dice and other supplies, increased $3 million to $7.1 million from last year.

Paul-Son Gaming President and Chief Executive Gerard Charlier said the results from the two periods aren't comparable.

As a result of a reverse merger with French casino supplier Etablissements Bourgogne et Grasset and its subsidiary, the Bud Jones Co., Paul-Son's size and structure underwent "substantial changes" over the past year, Charlier said. The merger was completed in January, resulting in B&G shareholders owning a majority of Paul-Son's outstanding shares.

Results from the third quarter ended Sept. 30, 2002 are solely those of B&G and are not directly comparable with those of the combined company, Charlier said.

"This quarter we did not experience the benefit of two large casino openings that we had in the second quarter of $3.1 million but we are still hopeful that the 2003 fourth quarter will result in higher revenue than the 2003 third quarter," he said.

Bond offering rated

Moody's Investors Service has assigned a Ba2 rating to Mandalay Resort Group's new $250 million senior secured notes due 2011 and has confirmed the company's existing ratings. The rating outlook remains stable. The Standard & Poor's rating agency also rated the bonds BB+. The Moody's rating is two notches below investment grade, while the S&P rating is one notch below investment grade.

Mandalay is selling the bonds in a private deals with investment firms but expects that the bonds eventually will be sold on the public market. The bonds carry a 6.38 percent interest rate.

Proceeds from the offering will be used to repay bank debt.

The ratings reflect the strong operating performance of the company's flagship Mandalay Bay resort, the gradual improvement of the Las Vegas gaming market and the longer-term opportunity associated with the company's plans to develop a permanent casino in Detroit, Moody's said.

The stable rating outlook is based on the strong opening of Mandalay's new convention center, the addition of a hotel tower at Mandalay Bay this year and expected lower capital expenditure requirements in fiscal 2005, the ratings agency said.