Lakes Entertainment saw a surge in second quarter sales and earnings from the buy-out of a management agreement with a tribal casino.
The Plymouth-based gaming company reported revenue of $28.2 million and net income of $9.5 million, or 36 cents per share, for the quarter ended July 3 compared to revenue of $4.8 million and net income of $3.9 million, or 15 cents per share, in the same quarter a year ago. For the six months ended July 3, the company reported revenue of $34.1 million and net income of $10.9 million, or 41 cents per share. That's compared to revenue of $11.8 million and a net loss of $778 thousand, or a loss of 3 cents per share, for the six months ended July 4, 2010.
On June 30 the Pokagon Band of Potawatomi Indians exercised its right to buy out the remaining term of its management agreement with Lakes at its Four Winds Casino Resort in New Buffalo, Mich. The Pokagon Band paid Lakes a buy-out fee of approximately $24.5 million.
Lakes said the buy-out fee would help fund additional casino developments in Cincinnati and Cleveland.
Lakes shares were trading at $2.28, up 6 percent in early morning trading.
Lakes currently has development and management or financing agreements with two separate Bands for casino operations in California. In addition to managing casinos, Lakes licenses table games to Tribal and non-Tribal casinos. According to its website, Lakes also owns a majority stake in the company that runs the World Poker Tour.
Shares were up 6 percent to $2.28 in early morning trading.
Patrick Kennedy • 612/673-7926
