Station Casinos Reports Q2 Results

25 Jul 2006

LAS VEGAS -- (PRESS RELEASE) -- Station Casinos, Inc. (NYSE: STN) today announced the results of its operations for the second quarter ended June 30, 2006 and other Company-related news.

Highlights include:

-Record second quarter EBITDA (1) of $134.0 million, an increase of 13% over the prior year's second quarter.

-Revenues from its Major Las Vegas Operations, excluding Green Valley Ranch, increased 28% from the prior year's second quarter.

-Adjusted for non-recurring items and development expenses, diluted earnings per share ("EPS") of $0.61 compared to $0.66 in the prior year's second quarter, a decrease of 8%.

-The successful opening of Red Rock Casino Resort Spa ("Red Rock") on April 18, 2006.

-The announcement of the Phase III master-planned expansion at Red Rock, which will include a 72-lane bowling center and expansions of both parking garages.

-Repurchasing approximately 6.3 million shares of the Company's common stock during the quarter, through a combination of open market purchases and an accelerated stock buyback program, thus completing the Company's previously authorized stock repurchases.

-A new authorization by the Board of Directors for the Company to repurchase up to 10 million shares of the Company's common stock.

-Declaring a quarterly cash dividend of $0.2875 per share payable on September 1, 2006 to shareholders of record on August 11, 2006, which constitutes a 15% increase over the prior quarterly dividend.

Results of Operations

The Company's net revenues for the second quarter ended June 30, 2006 were approximately $341.8 million, an increase of 25% compared to the prior year's second quarter. The Company reported EBITDA for the quarter of $134.0 million, an increase of 13% compared to the prior year's second quarter. This marks the eighteenth consecutive quarter of year-over-year growth of Adjusted EBITDA. For the second quarter, Adjusted Earnings (2) applicable to common stock were $37.3 million, or $0.61 per diluted share, compared to last year's $0.66 per diluted share on a comparable basis.

During the second quarter, the Company incurred preopening costs related to projects under development of $13.6 million, a $0.1 million loss on the disposition of certain assets and $2.5 million in costs to develop new gaming opportunities, primarily related to Native American gaming. Including these items, the Company reported net income of $26.8 million and diluted earnings applicable to common stock of $0.44 per share.

The Company's earnings from its Green Valley Ranch joint venture for the second quarter were $11.5 million, which represents a combination of the Company's management fee plus 50% of Green Valley Ranch's operating income. For the quarter, Green Valley Ranch generated EBITDA before management fees of $26.4 million, an 8% increase compared to the prior year's second quarter. "Green Valley Ranch has continued its strong performance this year despite the significant construction disruption related to the Phase III expansion of that property, as well as new supply in the market," said Lorenzo J. Fertitta, vice chairman and president.

Las Vegas Market Results

For the second quarter, net revenues from the Major Las Vegas Operations, excluding Green Valley Ranch, increased to $305.3 million, a 28% increase compared to the prior year's quarter, while EBITDA from those operations increased 17% to $114.5 million. The results for the second quarter include 73 days of operations at Red Rock. "The revenue growth reflects the very successful opening of Red Rock and the remarkable customer acceptance of the new property," said Lorenzo Fertitta.

EBITDA and Adjusted Earnings are not generally accepted accounting principles ("GAAP") measurements and are presented solely as a supplemental disclosure because the Company believes that they are widely used measures of operating performance in the gaming industry and as a principal basis for valuation of gaming companies. EBITDA and Adjusted Earnings are further defined in footnotes 1 and 2, respectively.

Balance Sheet Items and Capital Expenditures

Long-term debt was $3.04 billion as of June 30, 2006. Total capital expenditures were $215.3 million for the second quarter. Expansion and project capital expenditures included $140.3 million for Phase I and Phase II of Red Rock, $30.4 million for the expansion of Santa Fe Station, $13.3 million for the expansion of Fiesta Henderson and $6.5 million for the purchase of land. During the second quarter, the Company also purchased approximately 6.3 million shares of its common stock for approximately $472.7 million. As of June 30, 2006, the Company's debt to cash flow ratio as defined in its bank credit facility was 5.2 to 1.

Phase III Master-planned Expansion of Red Rock

Today the Company announced the commencement of the Phase III master-planned expansion of Red Rock, which will include a 72-lane bowling center and expansions of both parking garages. Construction of the bowling center is currently underway and is expected to be completed in the second quarter of 2007. The expansions of the parking garages are expected to begin in September 2006 and be completed in phases beginning in the third quarter of 2007 through the first quarter of 2008. The Company anticipates minimal construction disruption with respect to this expansion. The estimated cost of this expansion is approximately $60 million to $65 million.

Dividend

The Company's Board of Directors has declared a quarterly cash dividend of $0.2875 per share, which represents a 15% increase over the prior quarterly cash dividend. The dividend is payable on September 1, 2006 to shareholders of record on August 11, 2006.

Stock Repurchases

Since the beginning of the year, the Company has repurchased 10.1 million shares of its common stock through a combination of open market purchases and an accelerated stock buyback program, thus completing the Company's previously authorized stock repurchases. The total cost of the share repurchases completed in 2006 to date is approximately $737 million. In addition, on July 24, 2006 the Company's Board of Directors authorized the repurchase of up to an additional 10 million shares of the Company's common stock, which essentially replenishes the previous authorization.

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	Station Casinos Reports Q2 Results 25 Jul 2006 LAS VEGAS -- (PRESS RELEASE) -- Station Casinos, Inc. (NYSE: STN) today announced the results of its operations for the second quarter ended June 30, 2006 and other Company-related news. Highlights include: -Record second quarter EBITDA (1) of $134.0 million, an increase of 13% over the prior year's second quarter. -Revenues from its Major Las Vegas Operations, excluding Green Valley Ranch, increased 28% from the prior year's second quarter. -Adjusted for non-recurring items and development expenses, diluted earnings per share ("EPS") of $0.61 compared to $0.66 in the prior year's second quarter, a decrease of 8%. -The successful opening of Red Rock Casino Resort Spa ("Red Rock") on April 18, 2006. -The announcement of the Phase III master-planned expansion at Red Rock, which will include a 72-lane bowling center and expansions of both parking garages. -Repurchasing approximately 6.3 million shares of the Company's common stock during the quarter, through a combination of open market purchases and an accelerated stock buyback program, thus completing the Company's previously authorized stock repurchases. -A new authorization by the Board of Directors for the Company to repurchase up to 10 million shares of the Company's common stock. -Declaring a quarterly cash dividend of $0.2875 per share payable on September 1, 2006 to shareholders of record on August 11, 2006, which constitutes a 15% increase over the prior quarterly dividend. Results of Operations The Company's net revenues for the second quarter ended June 30, 2006 were approximately $341.8 million, an increase of 25% compared to the prior year's second quarter. The Company reported EBITDA for the quarter of $134.0 million, an increase of 13% compared to the prior year's second quarter. This marks the eighteenth consecutive quarter of year-over-year growth of Adjusted EBITDA. For the second quarter, Adjusted Earnings (2) applicable to common stock were $37.3 million, or $0.61 per diluted share, compared to last year's $0.66 per diluted share on a comparable basis. During the second quarter, the Company incurred preopening costs related to projects under development of $13.6 million, a $0.1 million loss on the disposition of certain assets and $2.5 million in costs to develop new gaming opportunities, primarily related to Native American gaming. Including these items, the Company reported net income of $26.8 million and diluted earnings applicable to common stock of $0.44 per share. The Company's earnings from its Green Valley Ranch joint venture for the second quarter were $11.5 million, which represents a combination of the Company's management fee plus 50% of Green Valley Ranch's operating income. For the quarter, Green Valley Ranch generated EBITDA before management fees of $26.4 million, an 8% increase compared to the prior year's second quarter. "Green Valley Ranch has continued its strong performance this year despite the significant construction disruption related to the Phase III expansion of that property, as well as new supply in the market," said Lorenzo J. Fertitta, vice chairman and president. Las Vegas Market Results For the second quarter, net revenues from the Major Las Vegas Operations, excluding Green Valley Ranch, increased to $305.3 million, a 28% increase compared to the prior year's quarter, while EBITDA from those operations increased 17% to $114.5 million. The results for the second quarter include 73 days of operations at Red Rock. "The revenue growth reflects the very successful opening of Red Rock and the remarkable customer acceptance of the new property," said Lorenzo Fertitta. EBITDA and Adjusted Earnings are not generally accepted accounting principles ("GAAP") measurements and are presented solely as a supplemental disclosure because the Company believes that they are widely used measures of operating performance in the gaming industry and as a principal basis for valuation of gaming companies. EBITDA and Adjusted Earnings are further defined in footnotes 1 and 2, respectively. Balance Sheet Items and Capital Expenditures Long-term debt was $3.04 billion as of June 30, 2006. Total capital expenditures were $215.3 million for the second quarter. Expansion and project capital expenditures included $140.3 million for Phase I and Phase II of Red Rock, $30.4 million for the expansion of Santa Fe Station, $13.3 million for the expansion of Fiesta Henderson and $6.5 million for the purchase of land. During the second quarter, the Company also purchased approximately 6.3 million shares of its common stock for approximately $472.7 million. As of June 30, 2006, the Company's debt to cash flow ratio as defined in its bank credit facility was 5.2 to 1. Phase III Master-planned Expansion of Red Rock Today the Company announced the commencement of the Phase III master-planned expansion of Red Rock, which will include a 72-lane bowling center and expansions of both parking garages. Construction of the bowling center is currently underway and is expected to be completed in the second quarter of 2007. The expansions of the parking garages are expected to begin in September 2006 and be completed in phases beginning in the third quarter of 2007 through the first quarter of 2008. The Company anticipates minimal construction disruption with respect to this expansion. The estimated cost of this expansion is approximately $60 million to $65 million. Dividend The Company's Board of Directors has declared a quarterly cash dividend of $0.2875 per share, which represents a 15% increase over the prior quarterly cash dividend. The dividend is payable on September 1, 2006 to shareholders of record on August 11, 2006. Stock Repurchases Since the beginning of the year, the Company has repurchased 10.1 million shares of its common stock through a combination of open market purchases and an accelerated stock buyback program, thus completing the Company's previously authorized stock repurchases. The total cost of the share repurchases completed in 2006 to date is approximately $737 million. In addition, on July 24, 2006 the Company's Board of Directors authorized the repurchase of up to an additional 10 million shares of the Company's common stock, which essentially replenishes the previous authorization.