Other income, net, was $4.2 million for the nine months ended September 30, 2012 compared to $3.9 million for the nine months ended October 2, 2011, a significant portion of which relates to non-cash accretion of interest on the Company’s notes receivable.
The income tax benefit for the nine months ended September 30, 2012 was $2.2 million compared to a benefit of $0.5 million for the prior year period. Lakes’ income tax benefit in the current year period was primarily due to the Company’s ability to carry back its estimated 2012 taxable loss to a prior year and receive a refund of taxes previously paid. Lakes’ income tax benefit in the prior year period was primarily due to 2011 timing differences and related valuation allowances.
Tim Cope, President and Chief Financial Officer of Lakes stated, "We are excited to have closed on the purchase of the Rocky Gap Lodge and Golf Resort near Cumberland, Maryland. The existing resort features 215 hotel rooms, convention center, spa, two restaurants and a Jack Nicklaus signature golf course. We are working diligently on our plans to convert existing convention and meeting space into a gaming facility that will feature approximately 550 video lottery terminals, a casino-center bar and a new hotel lobby bar/food outlet. We also plan to include table games should they be approved. We currently expect the gaming facility to open in the second quarter of 2013.” Mr. Cope continued, “We are pleased that third quarter 2012 results showed improvements over third quarter 2011 at the Red Hawk Casino and we are encouraged by the continued improvements in results at this property. We continue to work closely with Red Hawk’s executive team, as well as the Shingle Springs Tribal Gaming Authority, to manage this property as efficiently as possible.”
Further commenting, Lyle Berman, Chief Executive Officer of Lakes stated, “We look forward to the opening of the gaming facility at our Rocky Gap property, which we feel will provide a basis for future company growth. We continue to maintain a 10% ownership interest in Rock Ohio Ventures, LLC and its casino developments in Ohio, including the open and operating Horseshoe Casino Cleveland, the casino under development in Cincinnati which is expected to open during 2013, and the Thistledown Racetrack.” Mr. Berman continued, “Our goal remains managing our existing business as effectively as possible while evaluating potential new investments that will enable growth to support creating shareholder value.”