Lakes Entertainment, Inc. (NASDAQ: LACO) today announced results for the three months ended April 4, 2010.
Net loss for the first quarter of 2010 was $4.7 million, compared to earnings of $1.0 million in the first quarter of 2009, and the loss from operations was less than $0.1 million for each of those quarters. Basic and diluted losses were $0.18 per share for the first quarter of 2010 compared to basic and diluted earnings of $0.04 per share for the first quarter of 2009.
Lakes Entertainment reported first quarter 2010 revenues of $7.0 million, compared to prior-year first quarter revenues of $7.3 million. This decrease was primarily due to new competition that entered the Four Winds Casino Resort market during the third quarter of 2009.
For the first quarter of 2010, Lakes’ selling, general and administrative expenses were $3.2 million compared to $4.0 million in the first quarter of 2009. Selling, general and administrative expenses consisted primarily of payroll and related expenses, travel expenses and professional fees, all of which decreased compared to the prior year’s first quarter.
Net unrealized gains (losses) on notes receivable relate to the Company’s notes receivable from Indian tribes for casino projects that are not yet open, which are adjusted to estimated fair value based upon the current status of the related tribal casino projects and evolving market conditions. In the first quarter of 2010, net unrealized gains on notes receivable were $1.8 million, compared to net unrealized losses of $0.2 million in the prior year period. The net unrealized gains in the first quarter of 2010 consisted of $0.9 million related to the project for the Ioway Casino with the Iowa Tribe of Oklahoma (“Iowa Tribe”). These gains resulted from the previously announced termination agreement entered into with the Iowa Tribe in May 2010. Also included in net unrealized gains were gains of $0.9 million related to the Jamul Indian Village (“Jamul Tribe”) near San Diego, California due primarily to improvements in the credit markets. The net unrealized losses in the first quarter of 2009 were related to the project with the Jamul Tribe and the Iowa Tribe due primarily to ongoing issues in the credit markets and general economic uncertainties.