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The Chip Board Archive 06

Hard Rock Reports Record 3Q Revenues

Oct 17, 2002 16:58 ET

Hard Rock Hotel & Casino in Las Vegas Reports Record 3rd Quarter Net Revenues, EBITDA & Net Income

LAS VEGAS, Oct. 17 /PRNewswire-FirstCall/ -- Hard Rock Hotel, Inc. ("Hard Rock"), which owns and operates the Hard Rock Hotel & Casino in Las Vegas, Nevada, today reported 3rd quarter earnings before interest, taxes, depreciation and amortization and pre-opening ("EBITDA"), increased 31% to $8.0 million compared with $6.1 million in the year-earlier period. Net revenues for the 3rd quarter increased 17% to $33.7 million from $28.8 million and net income increased $2.6 million to $1.9 million from a net loss of $0.7 million in the year-earlier period.

(Photo: http://www.newscom.com/cgi-bin/prnh/20010507/HRHCLOGO )

Quarterly net revenues and net income improved due to increased revenues and operating profit in every department which more than offset increases in marketing, related party and general and administrative expenses. Net income also improved due to reductions in depreciation and net interest expense as more assets became fully depreciated and the company reduced its outstanding borrowings and the effective interest rate on its line of credit.

The increase in quarterly marketing and entertainment expenditures was primarily related to Hard Rock's national advertising campaign and higher caliber entertainment offerings in the Joint such as The Who during September 2002. General and administrative expenses increased primarily due to anticipated increases in management incentives that were curtailed in 2001.

Peter Morton, Hard Rock's Chairman of the Board and Chief Executive Officer, commenting on the quarterly results stated, "We are thrilled with our record 3rd quarter operating results. We believe that the increased marketing and entertainment expenditures have increased awareness of the property and will continue to drive revenues in the future. The Hotel has such upcoming concerts as the Rolling Stones this November 29."

There will be a conference call open to investors:

-- Date: Monday, October 21, 2002

-- Time: 2:00 P.M. Eastern Daylight Time

11:00 A.M. Pacific Daylight Time

Dial: 800-450-0821 Domestic only

CONTACT: Jim Bowen of Hard Rock Hotel, Inc., 702-693-5031

The press release contains certain forward-looking statements, which Hard Rock is making in reliance on the safe harbor provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that all forward- looking statements are subject to significant risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Additional information concerning risk factors that could cause actual results or events to differ materially from those projected in the forward-looking statements are contained in the Hard Rock's filings with the Securities and Exchange Commission.

HARD ROCK HOTEL, INC.

(in thousands, except share and per share amounts)

(unaudited)

Three Months Ended Nine Months Ended

September 30, September 30,

2002 2001 2002 2001
Revenue:

Casino $15,217 $11,363 $42,363 $37,471

Lodging 6,833 6,397 20,655 20,806

Food and beverage 10,212 9,455 31,830 29,644

Retail 2,219 2,153 6,844 6,794

Other income 1,987 1,893 5,603 5,556

Gross revenues 36,468 31,261 107,295 100,271

Less: complimentaries (2,736) (2,450) (8,099) (7,848)

Net revenues 33,732 28,811 99,196 92,423

Costs and expenses:

Casino 8,503 8,064 24,767 23,703

Lodging 1,856 1,862 5,373 5,517

Food and beverage 5,568 5,141 16,155 15,382

Retail 925 894 2,923 2,891

Other 1,032 1,023 2,950 2,792

Marketing 2,265 851 5,862 3,283

Related party expenses 1,001 862 2,779 2,691

General and administrative 4,539 4,023 12,730 12,338

Total costs and expenses 25,689 22,720 73,539 68,597

Earnings before interest, taxes, depreciation

and amortization and pre-opening

("EBITDA")

8,043 6,091 25,657 23,826

Pre-opening expense 100 -- 100 --

Depreciation and amortization 2,826 3,052 8,483 9,115

Interest expense, net 3,242 3,826 9,902 11,669

Income tax (benefit) provision -- (119) -- 120

Other (income) expense, net (4) -- 40 --

Net Income (Loss) 1,879 (668) 7,132 2,922

Preferred stock dividends 1,386 1,265 4,029 3,664

Income (Loss) applicable

to common shareholders $493 $(1,933) $3,103 $(742)

BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

Applicable to common

shareholders $6.48 $(25.43) $40.82 $9.76

Weighted average number of

common shares outstanding 76,023 76,023 76,023 76,023


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