Penn National Gaming Q1 Results Ahead of Guidance

21 Apr 2004

WYOMISSING, Pennsylvania -- (Press Release) -- Penn National Gaming, Inc. (Nasdaq:PENN) today reported record first quarter results for the period ended March 31, 2004.

-Diluted Net Income Per Share Rises to $0.43 vs. Guidance of $0.33

-Diluted Net Income Per Share Without Hollywood Casino - Shreveport Rises to $0.52 vs. Guidance of $0.40

-Income from Operations Rises to $54.3 Million vs. Guidance of $47.5 Million

-Raises 2004 Full Year EPS Guidance to $1.56 from $1.46

-Raises 2004 Full Year EPS Guidance Without Hollywood Casino - Shreveport to $1.90 from $1.75

Commenting on the results, Peter M. Carlino, Chief Executive Officer of Penn National said, "Our record first quarter was well ahead of the guidance which we provided in early February. The greater than anticipated results reflect strong financial performances at all of our gaming properties.

"The 2004 first quarter represents the fifth consecutive period of 'same store' year-over-year EBITDA gains at each casino property we have operated for more than a year -- namely Charles Town, Casino Rouge, Casino Magic - Bay St. Louis, Boomtown Biloxi, Bullwhackers and our Casino Rama management contract. These six properties generated an impressive 20% increase in first quarter 'same store' EBITDA when compared to their 2003 results. Our 41% increase in consolidated EBITDA reflects these 'same store' gains as well as the inclusion of a full three months of operations of the Hollywood Casino® assets in 2004 versus just one month in the first quarter of 2003. Our Hollywood Casino properties performed well in the first quarter 2004 and contributed over $28 million in EBITDA or about 37% of our consolidated EBITDA. Reflecting Penn National's continued strong operating trends, during the first quarter we pre-paid approximately $20.0 million of principal on our senior credit facility.

"We recently reported that The West Virginia Lottery Commission authorized a 1,000 machine increase in the number of slot devices at Charles Town Races which, if fully effected, would bring to 4,500 the number of slots at this location. We plan to add 300 of the newly authorized slot machines at Charles Town Races by the beginning of the fourth quarter of 2004, bringing the total slot machine installed base to 3,800 units. Beyond that we are undertaking another expansion at Charles Town which will include 1,000 more covered parking spaces immediately adjacent to our facility and the capacity to house, at some point in the future, the additional 700 games recently authorized. Increasing our slot offerings, while continuing our ongoing property enhancements and expansion will enable patrons to have better access to machines and an overall improved entertainment experience.

"During the first quarter, we were awarded a harness racing license in Maine for our recently purchased Bangor Historic Track, Inc. which operates harness racing at the city-owned track at Bass Park in Bangor, Maine. Local voters have approved a referendum allowing slot machines at the Bangor facility, and at this time both houses of the legislature have passed supplemental legislation that provides for additional regulation and taxation. The Joint Standing Committee on Appropriations and Financial Affairs is currently considering the fiscal impact of the legislation.

"We continue to pursue legislation permitting the placement of slot machines at our Pennsylvania racetracks which have been impacted by the availability of gaming in neighboring states. In the first quarter, EBITDA derived from these assets declined by 18% compared to 2003. Early this year the Governor proposed a new bill and has publicly requested a bill he can sign no later than June 30 of this year. In addition to the support of the Governor, the House, and the Senate, repeated polling indicates that 70% of Pennsylvanian's support slots in the state. The most recently proposed model would enable us to reinvigorate our racing operations and we have the funding in place to act quickly if a new bill is passed. We remain hopeful, but there is no certainty, that a slot bill will pass in Pennsylvania.

"While new opportunities and legislation are exciting elements in our growth, it is worth re-emphasizing that our first quarter gains reflect our long-term focus on operations, facility expansion and enhancement programs, marketing initiatives and our policy of appointing strong local management. We continue to maintain a disciplined approach regarding each of the new opportunities and analyze their potential benefit to Penn National based on several criteria including return on investment, further revenue and earnings diversification and most importantly, the potential to enhance shareholder value. Our increased 2004 guidance is based solely on our existing operating assets and does not assume any contributions from these new opportunities."

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	Penn National Gaming Q1 Results Ahead of Guidance 21 Apr 2004 <a href='https://ad.casinocity.com/adclick.php?n=a21efcd1'><img src='https://ad.casinocity.com/adview.php?what=-site:vendors/width:250/RON&n=a21efcd1' border='0' alt='' /></a> WYOMISSING, Pennsylvania -- (Press Release) -- Penn National Gaming, Inc. (Nasdaq:PENN) today reported record first quarter results for the period ended March 31, 2004. -Diluted Net Income Per Share Rises to $0.43 vs. Guidance of $0.33 -Diluted Net Income Per Share Without Hollywood Casino - Shreveport Rises to $0.52 vs. Guidance of $0.40 -Income from Operations Rises to $54.3 Million vs. Guidance of $47.5 Million -Raises 2004 Full Year EPS Guidance to $1.56 from $1.46 -Raises 2004 Full Year EPS Guidance Without Hollywood Casino - Shreveport to $1.90 from $1.75 Commenting on the results, Peter M. Carlino, Chief Executive Officer of Penn National said, "Our record first quarter was well ahead of the guidance which we provided in early February. The greater than anticipated results reflect strong financial performances at all of our gaming properties. "The 2004 first quarter represents the fifth consecutive period of 'same store' year-over-year EBITDA gains at each casino property we have operated for more than a year -- namely Charles Town, Casino Rouge, Casino Magic - Bay St. Louis, Boomtown Biloxi, Bullwhackers and our Casino Rama management contract. These six properties generated an impressive 20% increase in first quarter 'same store' EBITDA when compared to their 2003 results. Our 41% increase in consolidated EBITDA reflects these 'same store' gains as well as the inclusion of a full three months of operations of the Hollywood Casino® assets in 2004 versus just one month in the first quarter of 2003. Our Hollywood Casino properties performed well in the first quarter 2004 and contributed over $28 million in EBITDA or about 37% of our consolidated EBITDA. Reflecting Penn National's continued strong operating trends, during the first quarter we pre-paid approximately $20.0 million of principal on our senior credit facility. "We recently reported that The West Virginia Lottery Commission authorized a 1,000 machine increase in the number of slot devices at Charles Town Races which, if fully effected, would bring to 4,500 the number of slots at this location. We plan to add 300 of the newly authorized slot machines at Charles Town Races by the beginning of the fourth quarter of 2004, bringing the total slot machine installed base to 3,800 units. Beyond that we are undertaking another expansion at Charles Town which will include 1,000 more covered parking spaces immediately adjacent to our facility and the capacity to house, at some point in the future, the additional 700 games recently authorized. Increasing our slot offerings, while continuing our ongoing property enhancements and expansion will enable patrons to have better access to machines and an overall improved entertainment experience. "During the first quarter, we were awarded a harness racing license in Maine for our recently purchased Bangor Historic Track, Inc. which operates harness racing at the city-owned track at Bass Park in Bangor, Maine. Local voters have approved a referendum allowing slot machines at the Bangor facility, and at this time both houses of the legislature have passed supplemental legislation that provides for additional regulation and taxation. The Joint Standing Committee on Appropriations and Financial Affairs is currently considering the fiscal impact of the legislation. "We continue to pursue legislation permitting the placement of slot machines at our Pennsylvania racetracks which have been impacted by the availability of gaming in neighboring states. In the first quarter, EBITDA derived from these assets declined by 18% compared to 2003. Early this year the Governor proposed a new bill and has publicly requested a bill he can sign no later than June 30 of this year. In addition to the support of the Governor, the House, and the Senate, repeated polling indicates that 70% of Pennsylvanian's support slots in the state. The most recently proposed model would enable us to reinvigorate our racing operations and we have the funding in place to act quickly if a new bill is passed. We remain hopeful, but there is no certainty, that a slot bill will pass in Pennsylvania. "While new opportunities and legislation are exciting elements in our growth, it is worth re-emphasizing that our first quarter gains reflect our long-term focus on operations, facility expansion and enhancement programs, marketing initiatives and our policy of appointing strong local management. We continue to maintain a disciplined approach regarding each of the new opportunities and analyze their potential benefit to Penn National based on several criteria including return on investment, further revenue and earnings diversification and most importantly, the potential to enhance shareholder value. Our increased 2004 guidance is based solely on our existing operating assets and does not assume any contributions from these new opportunities."