Form 8-K ISLE OF CAPRI CASINOS For: Jun 14

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  June 14, 2016

ISLE OF CAPRI CASINOS, INC.

(Exact name of Registrant as specified in its charter)

(314) 813-9200

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.245)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On June 14, 2016, the Registrant reported its earnings for the fourth quarter and fiscal year ended April 24, 2016.  A copy of the press release of the Registrant is attached hereto as Exhibit 99.1 and incorporated herein by reference.

The information, including the exhibit attached hereto, in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, except as otherwise expressly stated in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

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Exhibit 99.1

ISLE OF CAPRI CASINOS, INC. ANNOUNCES

FISCAL 2016 FOURTH QUARTER AND YEAR RESULTS

SAINT LOUIS, MO — June 14, 2016 — Isle of Capri Casinos, Inc. (NASDAQ: ISLE) (the “Company”) today reported financial results for the fourth quarter and fiscal year ended April 24, 2016 and other Company-related news.

Fiscal 2016 Fourth Quarter and Fiscal Year 2016 Highlights

·                  Diluted net income per share from continuing operations increased to $0.60 per share from $0.08 in the prior year quarter.

·                  Eight of 13 properties reported higher year-over-year Adjusted EBITDA in the fourth quarter driven by continued strong performance at our Missouri properties.

·                  Adjusted EBITDA increased $0.4 million, to $65.8 million in the quarter compared to the prior year quarter while Adjusted EBITDA margin increased 57 bps, to 24.9%.

·                  Fiscal 2016 Adjusted EBITDA increased 5.0% year over year and Adjusted EBITDA margin increased 100 bps, to 21.6%.

·                  Our balance sheet continues to get stronger as debt to Adjusted EBITDA ratio was 4.4x at the end of fiscal 2016 compared to 4.9x a year ago.

Consolidated Financial Results

The following table outlines the Company’s financial results (dollars in millions, except per share data, unaudited):

(1)         For a further description of Consolidated Adjusted EBITDA, refer to the reconciliation tables following the narrative and the definition of Adjusted EBITDA in footnote (1) of this release.

(2)         For a reconciliation of the GAAP basis per share amounts to adjusted income (loss) per share, refer to the reconciliation table labeled “Reconciliation of GAAP Income (Loss) from Continuing Operations to Adjusted Income (Loss) and GAAP Income (Loss) from Continuing Operations Per Share to Adjusted Income (Loss) Per Share.”

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Eric Hausler, the Company’s chief executive officer, commented,

“We increased Adjusted EBITDA and Adjusted EBITDA margins for both the quarter and fiscal 2016, and have grown Adjusted EBITDA and Adjusted EBITDA margins in eight of the last nine quarters.

“We continue to focus on driving increased profitability from our existing operations, managing our corporate costs efficiently and optimizing our marketing costs.  We benefited from our geographic diversity during the quarter as strength in our Missouri and Iowa operations offset lower results year over year in Colorado, Florida and Louisiana.

“During fiscal 2016, we continued to reinvigorate our properties through prudent capital investments across the portfolio. Perhaps most significantly, we are excited to open our new land-based gaming and entertainment facility in Bettendorf on June 24, 2016.  We believe it will be an outstanding upgrade to the customer experience at our Bettendorf property.  Later this summer, we expect to launch our online play-for-fun casino and to offer lifestyle products under the Lady Luck brand.  We expect these new offerings to further enhance our player loyalty and broaden the demographic appeal of our Lady Luck brand.

“We are also particularly proud that we reduced our debt balance by over $70 million in fiscal 2016 and strengthened our balance sheet, while building Bettendorf and reinvesting in our properties. This highlights the strong free cash flow generation of our business.”

Financial Highlights

Net revenues for the current quarter were $264.9 million compared to $269.3 million in the prior year quarter, down 1.6%.  Seven of 13 properties reported higher net revenues for the quarter.

Consolidated Adjusted EBITDA was $65.8 million for the quarter compared to $65.4 million in the prior year quarter, up 0.7%.  Consolidated Adjusted EBITDA margins improved to 24.9% from 24.3%.  Operating income increased to $43.2 million from $35.9 million in the prior year quarter.

Interest expense was $16.7 million compared to $20.8 million in the prior year quarter, as a result of our lower overall debt balance as well as the benefits of refinancing our 7.75% Senior Notes due 2019 in the first quarter of fiscal 2016.

On a GAAP basis, diluted income per share from continuing operations was $0.60 compared to diluted income per share from continuing operations of $0.08 in the prior year’s quarter.

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The following items impacted income from continuing operations during the fourth quarter of fiscal 2015:

·                  We recorded a non-cash impairment charge of $9.0 million in fiscal 2015.

·                  We recorded a loss on early extinguishment of debt of $13.8 million in fiscal 2015 related to the tender and refinancing of our 7.75% Senior Notes due 2019.

Operating Results

(All comparisons are to the prior year quarter)

Black Hawk — Net revenues decreased $1.4 million, or 4.0%, to $32.4 million and Adjusted EBITDA decreased $0.9 million to $9.2 million, at our two casinos in Black Hawk. The property results were affected by increased competition in the market this year; in particular, the prior year quarter’s results benefited from construction disruption at a nearby property.

Pompano — Net revenues decreased $2.8 million, or 5.2%, to $51.8 million, and Adjusted EBITDA decreased 7.2%, to $13.8 million at Pompano Park.  Continuing from the third quarter, fewer transient customer trips year over year and an increased competitive environment hampered results in the early part of the quarter; however, the property rebounded to prior year levels in April. Despite the decline, Pompano generated the second highest fourth quarter Adjusted EBITDA since the property’s opening in 2007.

Iowa — Net revenues for our Iowa properties were flat to prior year at $48.5 million, while Adjusted EBITDA increased $0.4 million, to $14.6 million. Despite construction disruption from our new land-based facility, net revenues increased $0.1 million and Adjusted EBITDA increased $0.2 million at our property in Bettendorf.

Waterloo posted its second-highest fourth quarter Adjusted EBITDA since opening in June 2007.  Adjusted EBITDA margins at the property improved 150 basis points and Adjusted EBITDA increased $0.5 million, or 6.4%, to $8.2 million.

Our property in Marquette was impacted by an increased competitive environment resulting in decreased net revenues of $0.5 million, to $6.2 million.  Adjusted EBITDA declined $0.3 million, to $1.3 million.

Lake Charles — Our property in Lake Charles was negatively impacted by the closure of I-10 between Texas and Louisiana for four days in March due to flooding.  For the quarter, net revenues decreased $1.8 million, to $32.1 million, or 5.4%, while Adjusted EBITDA decreased $0.3 million, to $5.4 million, or 4.7%.  Excluding March’s results, Adjusted EBITDA increased compared to the same periods in the prior year.

Mississippi — Net revenues for Lula and Vicksburg decreased 1.0%, to $23.5 million while Adjusted EBITDA decreased $0.3 million, to $7.3 million, or 4.2%.

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Vicksburg’s net revenues increased $0.6 million, or 6.4%, and Adjusted EBITDA increased $0.1 million, or 2.3%, to $3.1 million as a result of changes in our marketing reinvestment strategy.

The Lula market continues to be negatively impacted by increased competition in the market.  Net revenues at our Lula property decreased $0.8 million, to $14.2 million and Adjusted EBITDA decreased $0.4 million, or 8.6%

Missouri — Net revenues for our Missouri properties increased $1.8 million, to $67.4 million and Adjusted EBITDA increased $2.1 million, to $22.0 million.  Cape Girardeau produced the highest fourth quarter Adjusted EBITDA since opening and Boonville, Caruthersville and Kansas City all produced their respective second highest quarterly Adjusted EBITDA.

Cape Girardeau’s net revenues increased $0.8 million, or 5.2%, and Adjusted EBITDA increased $1.0 million, or 25.0%.  The property’s Adjusted EBITDA margin improved 455 bps and generated over 100% flow-through on incremental revenues as it continues to ramp up.

In Caruthersville, net revenues increased $1.0 million, Adjusted EBITDA improved by 32.5%, to $3.2 million, and Adjusted EBITDA margins improved nearly 520 bps primarily due to continued strategic marketing spending and capital investments we have made to the property.

Boonville continues to post the Company’s highest Adjusted EBITDA margin, at 39.1% for the quarter, as it benefited from strategic marketing spending, maintaining a prudent operating cost structure and recent capital investments.  During the fourth quarter of fiscal 2016, net revenues increased 1.0%, to $20.6 million and Adjusted EBITDA increased 4.0%, to $8.1 million.

Kansas City reported its second highest fourth quarter Adjusted EBITDA, despite net revenues decreasing 1.4%, to $20.0 million. Adjusted EBITDA increased 0.9%, to $5.8 million.

Pennsylvania — At Nemacolin, net revenues increased 0.7%, to $9.1 million while the Adjusted EBITDA loss improved to $(0.1) million from $(0.2) million.

Corporate Expenses

Corporate and development expenses were $8.3 million for the quarter compared to $7.3 million in the fourth quarter of fiscal 2015. The current year quarter included expenses related to the former CEO’s exit agreement of $0.8 million.

Non-cash stock compensation expense was $1.2 million for the quarter compared to $0.6 million in the fourth quarter of fiscal 2015.

Excluding the aforementioned exit agreement costs and non-cash stock compensation expense, corporate and development expenses declined $0.4 million, or 5.3%, to $6.4 million.

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Capital Structure and Capital Expenditures

As of April 24, 2016, the Company had:

·                  $62.1 million in cash and cash equivalents, excluding $9.8 million in restricted cash and investments;

·                  $922.7 million in total debt; and

·                  $224.2 million in net line of credit availability.

Fourth quarter capital expenditures were $6.6 million, excluding spending related to the land-based project in Bettendorf. Capital expenditures were $50.9 million for the fiscal year ended April 24, 2016, excluding the Bettendorf land-based project, and consisted of maintenance and gaming equipment purchases as well as spending related to the hotel renovations in Bettendorf and Boonville.  We spent $19.4 million in fiscal 2016 on the $60 million land-based project at Bettendorf.  For the project-to-date, we have expended $21.6 million.  We expect to incur the remainder of the project cost in the first half of fiscal 2017.

For fiscal 2017 we provide guidance for the following specific non-operating items:

·                  Depreciation and amortization expense is expected to be approximately $78 million to $82 million.

·                  Interest expense is expected to be approximately $66 million to $68 million.

·                  The Company expects cash income taxes pertaining to fiscal 2017 operations to be less than $2 million.

·                  Corporate and development expenses for fiscal 2017 are expected to be approximately $28 million to $29 million, including approximately $5 million in non-cash stock compensation expense.

·                  Maintenance and other capital expenditures for fiscal 2017 are expected to be approximately $100 million, inclusive of the remaining spend on the Bettendorf land-based project.

Conference Call Information

Isle of Capri Casinos, Inc. will host a conference call on Tuesday, June 14, 2016 at 10:00 am central time during which management will discuss the financial and other matters addressed in this press release.  The conference call can be accessed by interested parties via webcast through the investor relations page of the Company’s website, www.islecorp.com, or, for domestic callers, by dialing 888-346-3970.  International callers can access the conference call by dialing 412-902-4263.  The conference call will be recorded and available for review starting at 11:59 pm central on Tuesday, June 14, 2016, until 11:59 pm central on Tuesday, June 28, 2016, by dialing 877-344-7529; International: 412-317-0088 and access number 10087579.

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About Isle of Capri Casinos, Inc.

Isle of Capri Casinos, Inc. is a leading regional gaming and entertainment company dedicated to providing guests with exceptional experience at each of the 14 casino properties that it owns or operates, primarily under the Isle and Lady Luck brands.  The Company currently operates gaming and entertainment facilities in Colorado, Florida, Iowa, Louisiana, Mississippi, Missouri, and Pennsylvania. More information is available at the Company’s website, www.islecorp.com.

Forward-Looking Statements

This press release may be deemed to contain forward-looking statements, which are subject to change. These forward-looking statements may be significantly impacted, either positively or negatively by various factors, including without limitation, licensing, and other regulatory approvals, financing sources, development and construction activities, costs and delays, weather, permits, competition and business conditions in the gaming industry. The forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements herein.

Additional information concerning potential factors that could affect the Company’s financial condition, results of operations and expansion projects, is included in the filings of the Company with the Securities and Exchange Commission, including, but not limited to, its Form 10-K for the most recently ended fiscal year.

CONTACT:

Isle of Capri Casinos, Inc.,

Jill Alexander, Senior Director of Corporate Communication-314.813.9368

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ISLE OF CAPRI CASINOS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share amounts)

(Unaudited)

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ISLE OF CAPRI CASINOS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

(Unaudited)

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Isle of Capri Casinos, Inc.

Supplemental Data - Net Revenues

(unaudited, in thousands)

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Isle of Capri Casinos, Inc.

Reconciliation of Operating Income (Loss) to Adjusted EBITDA

(unaudited, in thousands)

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