Station Casinos Reports Record Results

27 Apr 2005

LAS VEGAS -- (PRESS RELEASE) -- Station Casinos, Inc. (NYSE: STN) today announced the results of its operations for the first quarter ended March 31, 2005.

Highlights include:

-Same-store revenues from the Las Vegas operations increased 18% over the prior year's first quarter, marking the fifth consecutive quarter of double-digit same-store revenue growth on a year-over-year basis. Excluding Green Valley Ranch, the Major Las Vegas Operations increased 14% over the prior year's first quarter.

-Record first quarter EBITDA (1) of $120.9 million, an increase of 28% over the prior year's first quarter.

-Same-store EBITDA from the Las Vegas operations increased 34% over the prior year's first quarter. Excluding Green Valley Ranch, the Major Las Vegas Operations increased 30% over the prior year's first quarter.

-Adjusted for non-recurring items and development expense, diluted earnings per share of $0.70 compared to $0.51 in the prior year's first quarter, an increase of 37%.

-Same-store EBITDA margins for the Las Vegas operations increased to 42.9% from 37.9% in the prior year's first quarter.

The Office of the Secretary of the Department of the Interior indicated its approval of the conveyance of approximately 145 acres of property located near Kalamazoo, Michigan into trust for the benefit of the Gun Lake Tribe, subject to the publication of notice and expiration of the 30-day waiting period required by law.

-The announcement of master-planned expansions at Santa Fe Station and Fiesta Henderson.

Results of Operations

The Company's net revenues for the first quarter ended March 31, 2005 were approximately $273.5 million, an increase of 14% compared to the prior year's first quarter. The Company reported EBITDA for the quarter of $120.9 million, an increase of 28% compared to the prior year's first quarter. For the first quarter, Adjusted Earnings (2) applicable to common stock were $48.4 million, or $0.70 per share, an increase of 37% over the prior year's $0.51 per share on a comparable basis. This marks the thirteenth consecutive quarter of year-over-year growth of Adjusted EBITDA, EBITDA margin and EPS.

During the first quarter, the Company incurred preopening costs related to projects under development of $0.6 million, loss on the early retirement of debt of $0.7 million, $8.1 million to buyout various leases on property adjacent to the current Wild Wild West property and $2.6 million in costs to develop new gaming opportunities, primarily related to Native American gaming. Including these items, the Company reported net income of $40.6 million and diluted earnings applicable to common stock of $0.59 per share.

The Company's earnings from its Green Valley Ranch Station joint venture for the first quarter were $12.2 million, which represents a combination of Station's management fee plus 50% of Green Valley Ranch Station's operating income. For the quarter, Green Valley Ranch Station generated EBITDA before management fees of $27.0 million, a 52% increase compared to the prior year's first quarter. These numbers include a full quarter of results from the $125 million expansion of that property, which opened in December 2004 and included approximately 300 new hotel rooms and 25,000 square feet of meeting and convention space.

Las Vegas Market Results

Same-store (Major Las Vegas Operations and Green Valley Ranch Station) net revenues for the quarter increased to $296.8 million, an 18% increase compared to the prior year's quarter, while EBITDA from those operations increased 34% to $127.3 million. "Our fifth consecutive quarter of double-digit same-store revenue growth is further evidence of why we believe that, on a risk adjusted basis, the Las Vegas local's market is the best gaming market in the country. The stable regulatory, political and tax environment in Nevada, the strong Las Vegas economy and positive supply/demand characteristics in this market are the drivers of our business model," said Lorenzo J. Fertitta, vice chairman and president.

Gun Lake Tribe "Land into Trust" Update

Pursuant to a Memorandum dated April 18, 2005, the Office of the Secretary of the United States Department of the Interior indicated its approval of the conveyance of approximately 145 acres of property located approximately 25 miles north of Kalamazoo, Michigan into trust for the benefit of the Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians (the "Gun Lake Tribe"), subject to publication of notice and expiration of the 30-day waiting period required by law. "The Department of the Interior's action represents a significant step in the process and we look forward to working with the Gun Lake Tribe to bring this project to fruition," stated Fertitta. The Company owns a 50% interest in MPM Enterprises, LLC ("MPM"). MPM and the Gun Lake Tribe are parties to development and management agreements, pursuant to which MPM will assist the Gun Lake Tribe in developing and operating a gaming and entertainment project to be located on that property. The management agreement provides for a term of seven years and provides for a management fee of 30% of the project's net income. Pursuant to the terms of MPM's operating agreement, the Company's portion of that management fee, on an annual basis, is 50% of the first $24 million of management fees earned, 83% of the next $24 million of management fees earned and 93% of any management fees earned in excess of $48 million.

Master-Planned Expansions at Santa Fe Station and Fiesta Henderson

As previously announced, the Company will begin construction on the Phase II expansion of Red Rock Resort later this year. Today the Company announced the next two projects in the series of master-planned expansions and new properties expected to be developed in the Las Vegas local's market over the next several years. "Based on the extremely favorable supply/demand characteristics of the Las Vegas local's market, we have decided to accelerate both the development of master-planned expansions at our existing properties and the development of new properties. We believe that these high-return local development opportunities, combined with our Native American development opportunities, will provide us with a strong growth pipeline for years to come," said Fertitta.

This series of projects includes the Phase III master-planned expansion of Santa Fe Station. This expansion project will include a 2,900-space parking garage, a 500-seat buffet, 400 additional slot machines, a remodel and expansion of the race and sports book, a 15,000 square-foot meeting and banquet facility and a new center bar. Construction of this project is expected to begin in August 2005 and be completed in September 2006. The estimated cost of this project is $120 million. "We believe the additional amenities will satisfy the increasing demand in the rapidly growing northwest portion of the Las Vegas Valley," said Fertitta.

This series of projects also includes the Phase II master-planned expansion of Fiesta Henderson. This expansion project will include a 1,500-space parking garage, 350 additional slot machines, a remodeled and expanded race and sports book and a 12-screen movie theater complex. Construction of this project is expected to begin in July 2005 and be completed by June 2006. The estimated cost of this project is $70 million. "This portion of Henderson is also growing very quickly and this expansion will allow us to meet the market demand," stated Fertitta.

Balance Sheet Items and Capital Expenditures

Long-term debt was $1.41 billion as of March 31, 2005. Total capital expenditures totaled $147.3 million for the first quarter. Expansion and project capital expenditures included $54.4 million for Red Rock Resort, $5.5 million for the Phase II master-planned expansion of Santa Fe Station, $39.1 million for the purchase of land adjacent to the current Wild Wild West property, $15.1 million for the purchase of 96 acres of gaming-entitled property in Reno, Nevada and $8.7 million for the bowling center expansion at Sunset Station. As of March 31, 2005, the Company's debt to cash flow ratio as defined in its bank credit facility was 3.5 to 1.

Fiscal 2005 and 2006 Guidance

The Company expects EBITDA of approximately $113 million to $117 million for the second quarter of 2005 (excluding development expense and other non-recurring items). This would result in earnings per share ("EPS") of $0.61 to $0.65 for the second quarter, assuming 69.5 million fully diluted shares. This guidance assumes revenue growth for the second quarter of 9% to 12% over the prior year's quarter in Las Vegas (excluding Green Valley Ranch Station) with an effective tax rate of 36.5%.

For the remainder of 2005, the Company expects EBITDA of approximately $101 million to $105 million for the third quarter and $113 million to $117 million for the fourth quarter, excluding development expense and other non-recurring items. The guidance for the third and fourth quarters assumes approximately $5 million of construction disruption in each of those quarters relating to the Santa Fe Station and Fiesta Henderson master-planned expansions. This would result in EPS of $0.50 to $0.54 for the third quarter and $0.61 to $0.65 for the fourth quarter. As a result, the Company now expects EBITDA for 2005 of approximately $448 million to $460 million (excluding development expense and non-recurring items) and Adjusted Earnings applicable to common stock of approximately $2.43 to $2.55, assuming 69.5 million fully diluted shares. This guidance assumes revenue growth for 2005 of 7% to 11% over the prior year in Las Vegas (excluding Green Valley Ranch Station) with an effective tax rate of 36.5%.

In addition, the Company is updating its fiscal 2006 guidance. For fiscal 2006, the Company now expects EBITDA of approximately $530 million to $550 million, assuming approximately $6 million of construction disruption relating to the Santa Fe Station and Fiesta Henderson master-planned expansions, which would result in EPS of $2.67 to $2.86. This guidance assumes 3% to 5% revenue growth at the existing properties, the opening of Phase I of Red Rock Resort at the end of the first quarter of 2006, the completion of the Fiesta Henderson expansion by the end of the second quarter of 2006 and the completion of the Santa Fe Station expansion by the end of the third quarter of 2006. This guidance also assumes an effective tax rate of 36.5% and 70 million diluted shares outstanding.

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	Station Casinos Reports Record Results 27 Apr 2005 LAS VEGAS -- (PRESS RELEASE) -- Station Casinos, Inc. (NYSE: STN) today announced the results of its operations for the first quarter ended March 31, 2005. Highlights include: -Same-store revenues from the Las Vegas operations increased 18% over the prior year's first quarter, marking the fifth consecutive quarter of double-digit same-store revenue growth on a year-over-year basis. Excluding Green Valley Ranch, the Major Las Vegas Operations increased 14% over the prior year's first quarter. -Record first quarter EBITDA (1) of $120.9 million, an increase of 28% over the prior year's first quarter. -Same-store EBITDA from the Las Vegas operations increased 34% over the prior year's first quarter. Excluding Green Valley Ranch, the Major Las Vegas Operations increased 30% over the prior year's first quarter. -Adjusted for non-recurring items and development expense, diluted earnings per share of $0.70 compared to $0.51 in the prior year's first quarter, an increase of 37%. -Same-store EBITDA margins for the Las Vegas operations increased to 42.9% from 37.9% in the prior year's first quarter. The Office of the Secretary of the Department of the Interior indicated its approval of the conveyance of approximately 145 acres of property located near Kalamazoo, Michigan into trust for the benefit of the Gun Lake Tribe, subject to the publication of notice and expiration of the 30-day waiting period required by law. -The announcement of master-planned expansions at Santa Fe Station and Fiesta Henderson. Results of Operations The Company's net revenues for the first quarter ended March 31, 2005 were approximately $273.5 million, an increase of 14% compared to the prior year's first quarter. The Company reported EBITDA for the quarter of $120.9 million, an increase of 28% compared to the prior year's first quarter. For the first quarter, Adjusted Earnings (2) applicable to common stock were $48.4 million, or $0.70 per share, an increase of 37% over the prior year's $0.51 per share on a comparable basis. This marks the thirteenth consecutive quarter of year-over-year growth of Adjusted EBITDA, EBITDA margin and EPS. During the first quarter, the Company incurred preopening costs related to projects under development of $0.6 million, loss on the early retirement of debt of $0.7 million, $8.1 million to buyout various leases on property adjacent to the current Wild Wild West property and $2.6 million in costs to develop new gaming opportunities, primarily related to Native American gaming. Including these items, the Company reported net income of $40.6 million and diluted earnings applicable to common stock of $0.59 per share. The Company's earnings from its Green Valley Ranch Station joint venture for the first quarter were $12.2 million, which represents a combination of Station's management fee plus 50% of Green Valley Ranch Station's operating income. For the quarter, Green Valley Ranch Station generated EBITDA before management fees of $27.0 million, a 52% increase compared to the prior year's first quarter. These numbers include a full quarter of results from the $125 million expansion of that property, which opened in December 2004 and included approximately 300 new hotel rooms and 25,000 square feet of meeting and convention space. Las Vegas Market Results Same-store (Major Las Vegas Operations and Green Valley Ranch Station) net revenues for the quarter increased to $296.8 million, an 18% increase compared to the prior year's quarter, while EBITDA from those operations increased 34% to $127.3 million. "Our fifth consecutive quarter of double-digit same-store revenue growth is further evidence of why we believe that, on a risk adjusted basis, the Las Vegas local's market is the best gaming market in the country. The stable regulatory, political and tax environment in Nevada, the strong Las Vegas economy and positive supply/demand characteristics in this market are the drivers of our business model," said Lorenzo J. Fertitta, vice chairman and president. Gun Lake Tribe "Land into Trust" Update Pursuant to a Memorandum dated April 18, 2005, the Office of the Secretary of the United States Department of the Interior indicated its approval of the conveyance of approximately 145 acres of property located approximately 25 miles north of Kalamazoo, Michigan into trust for the benefit of the Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians (the "Gun Lake Tribe"), subject to publication of notice and expiration of the 30-day waiting period required by law. "The Department of the Interior's action represents a significant step in the process and we look forward to working with the Gun Lake Tribe to bring this project to fruition," stated Fertitta. The Company owns a 50% interest in MPM Enterprises, LLC ("MPM"). MPM and the Gun Lake Tribe are parties to development and management agreements, pursuant to which MPM will assist the Gun Lake Tribe in developing and operating a gaming and entertainment project to be located on that property. The management agreement provides for a term of seven years and provides for a management fee of 30% of the project's net income. Pursuant to the terms of MPM's operating agreement, the Company's portion of that management fee, on an annual basis, is 50% of the first $24 million of management fees earned, 83% of the next $24 million of management fees earned and 93% of any management fees earned in excess of $48 million. Master-Planned Expansions at Santa Fe Station and Fiesta Henderson As previously announced, the Company will begin construction on the Phase II expansion of Red Rock Resort later this year. Today the Company announced the next two projects in the series of master-planned expansions and new properties expected to be developed in the Las Vegas local's market over the next several years. "Based on the extremely favorable supply/demand characteristics of the Las Vegas local's market, we have decided to accelerate both the development of master-planned expansions at our existing properties and the development of new properties. We believe that these high-return local development opportunities, combined with our Native American development opportunities, will provide us with a strong growth pipeline for years to come," said Fertitta. This series of projects includes the Phase III master-planned expansion of Santa Fe Station. This expansion project will include a 2,900-space parking garage, a 500-seat buffet, 400 additional slot machines, a remodel and expansion of the race and sports book, a 15,000 square-foot meeting and banquet facility and a new center bar. Construction of this project is expected to begin in August 2005 and be completed in September 2006. The estimated cost of this project is $120 million. "We believe the additional amenities will satisfy the increasing demand in the rapidly growing northwest portion of the Las Vegas Valley," said Fertitta. This series of projects also includes the Phase II master-planned expansion of Fiesta Henderson. This expansion project will include a 1,500-space parking garage, 350 additional slot machines, a remodeled and expanded race and sports book and a 12-screen movie theater complex. Construction of this project is expected to begin in July 2005 and be completed by June 2006. The estimated cost of this project is $70 million. "This portion of Henderson is also growing very quickly and this expansion will allow us to meet the market demand," stated Fertitta. Balance Sheet Items and Capital Expenditures Long-term debt was $1.41 billion as of March 31, 2005. Total capital expenditures totaled $147.3 million for the first quarter. Expansion and project capital expenditures included $54.4 million for Red Rock Resort, $5.5 million for the Phase II master-planned expansion of Santa Fe Station, $39.1 million for the purchase of land adjacent to the current Wild Wild West property, $15.1 million for the purchase of 96 acres of gaming-entitled property in Reno, Nevada and $8.7 million for the bowling center expansion at Sunset Station. As of March 31, 2005, the Company's debt to cash flow ratio as defined in its bank credit facility was 3.5 to 1. Fiscal 2005 and 2006 Guidance The Company expects EBITDA of approximately $113 million to $117 million for the second quarter of 2005 (excluding development expense and other non-recurring items). This would result in earnings per share ("EPS") of $0.61 to $0.65 for the second quarter, assuming 69.5 million fully diluted shares. This guidance assumes revenue growth for the second quarter of 9% to 12% over the prior year's quarter in Las Vegas (excluding Green Valley Ranch Station) with an effective tax rate of 36.5%. For the remainder of 2005, the Company expects EBITDA of approximately $101 million to $105 million for the third quarter and $113 million to $117 million for the fourth quarter, excluding development expense and other non-recurring items. The guidance for the third and fourth quarters assumes approximately $5 million of construction disruption in each of those quarters relating to the Santa Fe Station and Fiesta Henderson master-planned expansions. This would result in EPS of $0.50 to $0.54 for the third quarter and $0.61 to $0.65 for the fourth quarter. As a result, the Company now expects EBITDA for 2005 of approximately $448 million to $460 million (excluding development expense and non-recurring items) and Adjusted Earnings applicable to common stock of approximately $2.43 to $2.55, assuming 69.5 million fully diluted shares. This guidance assumes revenue growth for 2005 of 7% to 11% over the prior year in Las Vegas (excluding Green Valley Ranch Station) with an effective tax rate of 36.5%. In addition, the Company is updating its fiscal 2006 guidance. For fiscal 2006, the Company now expects EBITDA of approximately $530 million to $550 million, assuming approximately $6 million of construction disruption relating to the Santa Fe Station and Fiesta Henderson master-planned expansions, which would result in EPS of $2.67 to $2.86. This guidance assumes 3% to 5% revenue growth at the existing properties, the opening of Phase I of Red Rock Resort at the end of the first quarter of 2006, the completion of the Fiesta Henderson expansion by the end of the second quarter of 2006 and the completion of the Santa Fe Station expansion by the end of the third quarter of 2006. This guidance also assumes an effective tax rate of 36.5% and 70 million diluted shares outstanding.