Gaming briefs for Oct. 6, 2003

Monday, Oct. 6, 2003 | 11:19 a.m.

Stock down on earnings miss

Boyd Gaming Corp. said today it expects third-quarter earnings to miss analysts' expectations, primarily because of lower results at its Stardust and Par-A-Dice casinos. Its stock fell 11 percent in midday trading.

The Las Vegas company now estimates third-quarter earnings per share to range from 14 cents to 16 cents per share versus 17 cents in the year-ago quarter. Analysts had estimated the company would earn 21 cents per share.

Spokesman Rob Stillwell declined to reveal specifics about the two properties other than to say that higher taxes in Illinois have cut into returns at Par-A-Dice, located in East Peoria.

"If it wasn't for those two properties, we'd probably be within consensus estimates," he said.

The Borgata casino in Atlantic City, which opened in July, may also be reporting weak profit because of promotional spending, Deutsche Bank analyst Marc Falcone wrote in a report. Boyd owns half of the Borgata with partner MGM MIRAGE.

The company's third-quarter earnings report is expected the week of Oct. 20.

Shares of Boyd fell $1.59 to $13.57 at 11:55 a.m. in New York Stock Exchange trading. They had risen 7.9 percent this year. The company owns 13 casinos in markets including Louisiana and Mississippi.

Vegas firm buys Reno chain

Golden Gaming Inc., owner of the PT's Pub chain in Las Vegas, agreed to acquire the six-location Sparky's Sports Bar & Grill chain in the Reno-Sparks area.

Terms weren't disclosed.

Golden Gaming said it's Nevada's largest tavern operator and the state's third-largest slot route operator. Its PT's Entertainment Group has 26 locations in the Las Vegas area along with the Gold Bar in Fernley. The slot route operates about 1,600 machines in 126 locations in the Las Vegas area.

County sued over denial of time share tower

A partnership, whose plan to build a time share tower adjacent to the Showcase mall was shot down by the Clark County Commission, has filed suit against the county to overturn the vote.

Last month commissioners voted 4-2 to reject a plan by Florida-based Westgate Resorts to build a 43-story time share tower on the Las Vegas Strip site. Neighbor MGM Grand objected to the project, saying it would create traffic problems and was too substantial to fit on just 2.5 acres of land.

Westgate Resorts President David Siegel threatened to sue the county following the decision, which he said was intended to favor MGM Grand at the expense of competitors and did not take into account other factors.

The suit, filed Friday in Clark County District Court, calls for the commission to approve the Westgate application and for a judicial review of the commission's denial.

Advertising changed in response to lawsuit

LOUISVILLE, Ky. -- A semiretired bookkeeper has sued the Kentucky Lottery Corp., accusing it of falsely advertising how numbers in one of its instant-win games are picked.

Ronald B. Hub's lawsuit, filed in Jefferson County Circuit Court, seeks $1,000 in compensatory damages and $10 million in punitive damages.

It claims a promotional brochure by the lottery stated that the single-digit numbers printed on "Extra Cash" tickets are randomly generated. However, Hub says losing numbers were printed much more frequently even though he had used the same numbers each time.

The lottery denies wrongdoing. But it altered the brochure's language after Hub sued to say winners are randomly selected, rather than the one-digit numbers being randomly generated.

Lottery general counsel William May said the wording was changed "to more accurately reflect the randomness of how the game is played."

"There was no intent to mislead," May said.

Hub said the difference is important because the odds of winning would be greatly enhanced if the digits were random. Jefferson Circuit Judge John W. Potter agreed with Hub on that point.

"Extra Cash" is based on the numbers a player chooses for a Pick 3 or Pick 4 drawing but does not depend on those daily drawings. It uses the player's numbers for a computerized drawing that instantly determines the winner.

Hub, an avid lottery player, said he figured that using the four digits on a Pick 4 ticket, he had at least a 4-in-10 chance of winning each time.

"It can't be randomly generated numbers, or they'd lose their shirt," Potter said in a pretrial hearing last summer. However, he told Hub that the lottery had sufficiently answered questions about how "Extra Cash" works.