Golden Entertainment Inc (GDEN) 2008 Q1 法說會逐字稿

Good day ladies and gentlemen, and welcome to the first quarter 2008 Lakes Entertainment Incorporated earnings conference call. My name is Jasmine, and I will be the operator for today. At this time all attendees are in a listen-only mode. We will conduct a question and answer session towards the end of this conference. (OPERATOR INSTRUCTIONS).

I would now like to turn the presentation over to your host for today's call, Mr. Tim Cope. You may proceed, sir.

Thanks, Jasmine. Good afternoon, and welcome to Lakes Entertainment's first quarter 2008 earnings conference call, on the call with me is Lyle Berman, Lakes Chairman of the Board and Chief Executive Officer.

As we begin our prepared remarks, I would like to remind everyone that this call may contain forward-looking statements within the meaning of the federal securities law, including statements regarding business strategies, and intended results, and similar statements concerning anticipated future events, and expectations that are not historical facts. These forward-looking statements are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements do not guarantee future performance, and therefore undue reliance should not be placed upon them. Lyle will begin our discussion today with a general overview and update on our Casino projects. I will then discuss the fourth quarter financial results and recent business events, and then we will conduct a question and answer session. Lyle?

Thank you, Tim. And welcome everyone to the Lakes' first quarter 2008 conference call. Our first quarter was initially hampered by severe weather in Michigan, but we believe that significantly improved results in the second half of the quarter show that the Four Winds Casino Resort, which we manage on behalf of the Pokagon Band of the Potawatomi Indians, is on the right path, and capable of producing strong results given reasonable conditions. We anticipate spring and summer months will be strong, and provide further evidenced that Four Winds, is one of the top destinations in the Great Lakes region. In addition we continue to refine our targets in terms of customers and demographics, in order to provide the best possible guest experience and maximize operating results at Four Winds.

Four Winds customer loyalty program continues to rapidly expand, and our club membership still exceeds our expectations. We have used this data to create direct marketing programs and promotions, that have significantly improved the level of play from our guests, increasing the win per guest statistics. We have also used these same programs to leverage the hotel as well. YTD we are now running over 97% occupancy. To meet the demands of the higher worth players, we converted the seafood restaurant in a dedicated club member only lounge, exclusively for members of the top tier, of the loyalty program. This change along, with other service initiatives, has resonated well with the players, and reflects positively in our customer service surveys. Further in April, we shifted advertising dollars to introduce Four Winds into the important Chicago market, and we believe our campaign will raise the awareness, and help us further penetrate this market. March was clearly our best operating month since opening, and April continued on a similar path.

In addition to Four Winds, our Cimarron Casino, in Perkins, Oklahoma which we machine for the Iowa Tribe of Oklahoma, continues along with strong results. The Casino which contains 360 class three slot machines, continues to show steady improvements. In the first quarter of 2008, total revenue was up 26% from the prior year. We expect continued solid performance from Cimarron throughout the year.

The Red Hawk Casino project near Sacramento, California, which is the Casino development and management project currently under construction with the Shingle Springs Band of Miwok Indians, remains within budget, and on schedule for our grand opening in late fourth quarter of 2008. We are currently in the process of arranging FF&E financing, of approximately $65 million. The Casino project is approximately 59% complete. Once fully completed, the facility will host a total of 2100 slot machines and gaming devices, 75 gaming tables, ten food and beverage outlets, and approximately 3,200 covered packing spaces. We will also have a dedicated interchange from U.S. Route 50, which is approximately 74% complete, allowing easy access for our customer to the Casino, only a few hundred yards away. We believe the Red Hawk Casino is well-positioned to draw from a large customer base, with over 4 million people, in a 75-mile radius of the Casino, achieve a strong ROI, and create strong shareholder value. You can see webcam shots of current construction on our website at www.LakesEntertainment.com.

There is not much news to report on Jamul Indian Village Casino project near San Diego, and the Ioway Casino Resort, near Chandler, Oklahoma. Planning is still ongoing to redesign the proposed Jamul Casino, to provide for approximately 1,000 class two gaming devices, along with 25 class two table games. We are working with the tribe to determine when Casino construction will begin.

For the Ioway Casino Resort, which hurt our second project with the Iowa Tribe of Oklahoma, we are still waiting on the Bureau of Indian Affairs, for approval of the land plan, on which the Casino Resort will be built. After the B.I.A. approval is received, we expect to rapidly receive NGIC approval on our management contract, the last step needed before design, financing, and construction of the project begins. Once approval is received, we expect a 12 to 18 month development and construction time, with an expected opening of Ioway Casino in early 2010. The Casino is currently planned to have approximately 1200 to 1500 class three slot machines, 30 to 50 table games, four restaurants and a hotel. There is nothing new to report on our Vicksburg, Mississippi, project.

Now I would like to talk about our newest and very exciting project in Ohio. We announced last week that we have partnered with My Ohio Now in its efforts to pursue the development of a Casino in Ohio. We are sponsoring a referendum to be voted on by Ohio residents during the November 4 Presidential Election. Our referendum contains two major points. We will authorize one, and only one Casino and entertainment destination resort, to be built at a cost of no less than $600 million, on a particular 94 acres of land in Clinton County. The site is at the crossroads of Highway 71 and Highway 73. It is equidistant south of Columbus, north of Cincinnati, and east of Dayton, approximately 4.2 million people live within 65 miles of the site.

Number two, the referendum calls for a gaming tax revenue of 30%, which we estimate to be between $200 million and $240 million, to be shared directly with each of the 88 counties in Ohio, based on population, with no strings attached. The money does not go to the state, but rather direct to the each county, every year. Two major additional selling points for the referendum, we estimate the Casino would provide up to 5,000 more jobs, as well as the beneficial economic development created by the Casino. And B., four out of five states surrounding Ohio, namely Indiana, Michigan, Pennsylvania, and West Virginia, have Casino gaming. Ohio money and the direct beneficial economic development associated with the Casino, are leaving the state at 65 miles per hour. It's time that stops.

As there have been three previous efforts to create casinos in the state, via the referendum process, the first question you might ask is, why will you succeed where others have failed? Of the three failed efforts, one was in 1990, 18 years ago. And one was in 1996 in this case, 12 years ago. Due to the time lapse we don't believe those are pertinent. The most recent effort was in 2006. They lost the vote 57% against, to 43% in favor. We think that is good news as we only have to convince another 7% to win. Although they spent $28 million on the campaign, it is our understanding $16 million of the total was spent on consultants, not on direct media buys, and was not a very focused, well managed, campaign.

The main differences between the 2006 proposal and our proposal are, one, their bill called for legalization of seven casinos-- slots at racetracks, and two casinos, all in populated areas, versus ours to legalize one and only one $600 million destination Casino Resort, in a rural area. Two, all of the taxes generated for the casinos, were to be distributed pursuant to a plan called Learn and Earn. It would be primarily used for college scholarships to the upper 5% of high school graduates, versus our proposal which has been labeled, Share The Wealth, under which as previously stated, each county would receive their fair share of the gaming tax revenue, directly from the Casino. We believe each county know best how to spend their share of the gaming tax revenue. With our proposal each county receives a direct financial interest from the Casino, each and every year.

Three, their referendum was conducted in a non-Presidential Election year. We believe the additional voters during this Presidential Election year, demographically, will be more prone to vote yes. The timing for our efforts is as follows. Announcement of our involvement on April 30, this year, just occurred. In order to be on the ballot in November, we must gather 402,000 valid signatures on the petition. We have hired a firm to collect 700,000 signatures by August 1. Certification of the signatures, which guarantees our referendum will be on the ballot, should be completed by the state, by the end of August. We will be conducting a major educational campaign in September and October. If successful on November 4, we estimate it will take 12 to 18 months for the state to form a gaming commission, and our architects to finish the architectural and engineering plans. We estimate the construction time frame to be an additional 12 to 18 months as well. If successful, we estimate opening the Casino in the Fall of 2011.

With that, I'll turn the call back over to Tim, to provide an overview of recent business issues and financial results.

Thank you, Lyle. First quarter 2008 consolidated revenues were $9.6 million, up 92.3% from the prior year period. Lakes' revenue increased $4.1 million, primarily due to a full core contribution of management fees from the Four Winds Casino Resort, compared to no contribution from that property in the first quarter 2007. Revenue related to WPTE increased to $5 million for the first quarter of 2008, compared to $4.5 million in the prior year period. This increase is due to an increase in hosting and sponsorship revenues, primarily driven by international television sponsorship revenues, that did not exist in the prior year period.

In accordance with a management contract with the Pokagon Band, pre-opening expenses during the construction phase of the product are shared proportionately by Lakes, during the first 12 months of Four Winds operations. To clarify, Lakes' proportionate share is approximately $4 million over the first 12 months of operations, and only the first 12 months. There is no impact on Lakes' fees in subsequent years.

Consolidated SG&A expenses were up $1.2 million from the prior year period, to $10.9 million, due to $1.6 million in development costs associated with the proposed Ohio Casino Resort project. For the first quarter of 2008 Lakes' SG&A expenses were $5.5 million, and consisted primarily of payroll and related expenses of $2.2 million, including share-based compensation, a development cost associated with the Ohio Casino Resort project of $1.6 million, and professional fees of approximately $600,000. Other cost and expenses in the first quarter of 2008 included amortization of intangible assets of approximately $1.7 million, associated with the Casino project with the Pokagon Band which commenced upon the August 2007 opening of the Four Winds Casino Resort.

Net realized and unrealized gains and losses on notes receivable, relate primarily to the company's notes receivable from Indian tribes, 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 2008 net unrealized losses on notes receivable were $2 million, compared to net unrealized gains of $200,000 in the prior year period. Net unrealized losses in the current year quarter were due primarily to a decrease in projected interest rates, due to current market conditions for the notes receivable, related to the Red Hawk Casino project with the Shingle Springs Band and Miwok Indians, and the notes receivable related to the Casino project with the Jamul Indian Village.

Now I would like to discuss auction rate securities. As of March 30, 2008 the company had $8.6 million in cash and cash equivalents, $8.5 million in short term investments in marketable securities, and $38.8 million in long-term investments in marketable securities. Of these amounts, $3.6 million in cash and cash equivalents related to Lakes, and $25.5 million in long-term investments related to Lakes. All other amounts related to WPTE. All of Lakes long-term investments in marketable securities, and $11.3 million of WPTE's long-term investments in marketable securities, were auction rate securities. Which I will refer to us a ARSs. As we saw some current liquidity issues surrounding the company's ARSs that is I will discuss shortly, the company's ARSs were reclassified from short term, to long-term investments in marketable securities as of March 30, 2008.

The types of ARSs that the company owns are backed by student loans, the majority of which are guaranteed under the Federal family education loan program, and also have ratings of AAA. Neither Lakes nor WPTE own any other type of ARSs. None of our investments in ARSs qualify or have been classified in our financial statements, as cash or cash equivalents. Historically, these types of ARS investments have been highly liquid using the auction rate process, to reassess the applicable interest rate, at predetermined intervals, typically seven to 35 days to apply liquidity at par. However, as a result of the recent liquidity issues experienced in the global credit markets and capital markets, the auctions for all of the company's ARSs began failing in February 2008, when sale orders exceeded buy orders. The failures of these auctions do not affect the value of the collateral underlying the ARSs, and the company will continue to earn and receive interest on its ARSs, at contractually set rates.

However, the company will not be able to liquidate its ARSs until the issuer calls the security, a successful auction occurs, buyers found outside of the auction process, or the security occurs. During April of 2008 the company received account statements dated March 30, 2008, from the firms managing its ARSs, which estimated a fair value of the company's ARSs. The company analyzed these statements, and we've concluded that a temporary decline in estimated fair value of $2.4 million, related to companies ARSs has occurred, as a result of the current lack of liquidity. This consolidated decline in fair value includes $1.3 million related to Lakes, and $1.1 million related to WPTE. Since the company considers the decline in the estimated fair values of its ARSs to be temporary, the related unrealized losses included in accumulated other comprehensive loss, in the shareholders equity section of the company's balance sheet as of March 30, 2008.

Lakes entered into a client agreement with UBS Financial Services effective April 11, 2008, for purposes of borrowing and or obtaining credit in a principal amount, not to exceed $11 million. Lakes has made an initial draw under the margin account agreement, in the principal amount of $3 million, to be used for working capital purposes. The company will be required to seek additional sources of financing, to fund additional costs of plans to incur between August and November of this year, associated with the recently announced Ohio Casino Resort project. These costs are dependent on various factors including; polling numbers, market studies, and media efforts. Lakes is currently exploring several financing alternatives, and expects to be able to obtain funding as necessary. WPTE does not believe that any lack of liquidity during the next 12 months relating to its ARSs, will have an impact on its ability to fund its operations.

Lakes also had $77.9 million in notes receivable from Indian tribes, adjusted to the estimated fair value as of March 30, 2008. The corresponding face value of these notes including accrued interest was $119.4 million. As of March 30, 2008, the company had no interest bearing long-term debt, and had $6.7 million in long-term contract acquisition costs payable. In addition to our financial results, we are maintaining our core 2008 SG&A guidance of remaining relatively flat with the previous year. Our SG&A expense guidance does not include development costs associated with the proposed Ohio Casino project.

In summary, Lakes Entertainment on a stand alone basis, at the end of the first quarter, has a pool of assets that includes approximately $8 million in current assets, $9 million in property and equipment, $119 million in notes receivable from our Native American Casino projects, $11 million in other assets related to our Casino projects, and $27 million in auction rate securities, for a total of $174 million in cash value assets. Offsetting these assets for Lakes is approximately $29 million in various liabilities, for a Lakes stands alone net asset cash value of approximately $145 million. Now I'll return the call over to Lyle.

Thank you, Jim. For the rest of 2008 Lakes remains focused on successfully managing our current operations, opening the Red Hawk Casino in the fourth quarter of the year, and getting our referendum on the Ohio ballot, and passed in November. With that, I will turn the call over to the operator for questions.

(OPERATOR INSTRUCTIONS). Your first question comes from James Kayler, you may proceed.

Hello guys, how are you doing?

Good James.

Obviously Pokagon is doing well, and continues to ramp up, and the occupancy is very high, can you talk about future expansion plans, and what restraints you have, given the capital structure,e when you could start on something?

Sure I can speak to that. We are in discussions with the tribal leaders and tribal government there. We elicit the aid of outside development companies, including our own development firms, and we are looking at various alternatives there. I think one of the main things we've all come to an agreement on, additional rooms would be a plus for that property. In terms of the financial ability to do it, as you're well aware with the bon covenants in place, nothing can really take place until after the first 12 years of operations, and certain covenant tests are met at that point in time--

Excuse me, Tim, 12 months, you said 12 years?

I'm sorry. 12 months. 12 years we will have a big project by then.

Yeah, I was--

12 months. And then obviously after the covenant tests are met, and that will determine how much more additional debt can be incurred.

Okay. Is there any update on the Shingle Springs compact?

Nothing to report at this time. Tribal leadership and their advisors are in constant communication with the Governor's office. There is nothing into at this point to discuss.

Beginning that the opening is coming up soon, at what point do you have to decide on class two or class three machines?

Pretty soon. We've been meeting with gaming vendors on a regular basis. I think internally we are looking towards over the next three or four weeks, we are going to have to make a decision at least getting boxes in the manufacturing process, and that will give us enough lead time to, as I said the boxes themselves are being built, and then the software-- hopefully we can still make a decision on class two versus class three, on a timely basis.

Okay, thanks, guys.

And your next question comes from, Todd Eilers, you may proceed.

Hello guys, how are you?

Hello Todd.

Just a couple of questions, first on the Ohio project, can you give us an indication of how much you plan to spend on that, at this point in time?

At this point, I guess it's fair to say, we don't know for sure, because it's going to have a great deal to do with what our polls say, both initially at the end of July, when we would start looking, because we are doing a small introductory campaign right now. Also it would be how much advertising and money is raised by the, forces that don't want this to happen. That's why we gave you, we can't say for sure, but we gave you a little bit of a guidance on what the previous people spent on their campaign.

Okay. How about for this next quarter, would you anticipate a similar amount, that you spent in the first quarter? Can you help us out, since that's maybe a little bit more near term?

Yes, I think that we -- Tim, I believe we've announced how much we are going to spend through July, is that correct?

I think we are estimating approximate, total all in, including what we've already announced this quarter of about $8 million roughly, through, to get us through first part of August.

Okay. All of those expenses will show up in your SG&A line, is that correct?

That's correct, that will be an operating expense.

Okay. Moving on, Tim, in the past, I think you give the market value of the notes based on project, can you do that?

Sure, I can do that. The face value at Jamul at the end of the quarter was about 44 million, Shingle Springs, 70 million, and the Ioway project, 5 million approximately, and that gets us to the 119 million we discussed.

Can you give, I don't believe I heard it, can you give stock-based comp for the quarter?

That was probably-- approximately 200,000.

Okay. And then, in terms of you guys provide management fees, kind of lumping both projects in together, obviously Pokagon is the larger there, in the past you've kind of indicated that the revenue coming out of Oklahoma has been in that kind of 400,000 to maybe 450,000 range per quarter. Is that still tracking in that range? It sounds like that project continues to-- or that Casino continues to grow its revenues, are those management fees increasing for you? Just trying to back in what you are getting from Pokagon.

I know what you're trying to do. That's properly a fair statement I think, it's roughly approximately 400,000 a quarter.

Okay. You mentioned liquidity and needs for additional financing that you're pursuing, is that all just related to the Ohio project, I mean if we exclude, let's say you weren't going after the Ohio project, would you be fine from a liquidity standpoint?

We are relative, UBS has given us a line of credit of $11 million on the ARSs that they have. And that line of credit is adequate for us, to get through all of our obligations until we start cash flowing, due to Shingle Springs opening. And that includes the $8 million that we've committed to in Ohio through July. But it does not take into account any monies that will be spent from August on, in Ohio.

Then future financing activities, would those be at kind of a joint venture level, I know you started a joint venture structure there for Ohio, would the financing be covered under that joint venture, or would it be under Lakes corporate?

The financing would be advanced to that corporation by Lakes, or the financing is totally the obligation of Lakes.

One last question if I might, Tim, I know I always ask you this, and I know it's always a tough question or tough to predict, but taxes it was roughly 700,000 in the quarter. What should we expect going forward?

I think that's about right, I think that's an approximate run rate, assuming nothing else changes, that's about what we are occurring.

Okay. Thanks, guys.

Your next question comes from Chris Krueger, you may proceed, sir.

Hello, good afternoon guys. I kind of neat a little bit of a repeat on the last question. I just want to make sure I understand it, on the filing that, I thought it was stated that you were lending $8 million to this partnership, but just to be clear, that $8 million, is that-- will that actually be in your SG&A line?

Yes.

Okay.

It will, right, it's loaned to a partnership, but because obviously there is no certainty that the referendum is going to passed yet at this point, it's still considered similar to a R&D expense.

And again to repeat in your stated comments your estimated gaming revenues that would go to the state, was that a range $200 million to $240 million per year?

Yes, this is Lyle, it would be-- again, not going to the state, going to the 88 counties within the state, directly from the Casino to the county, but yes, we estimate the 30% to be in the $200 million to $240 million range.

Okay. And as far as how you go about this, do you, is it a lot like a Presidential campaign or a Senate campaign where you have some guys out there doing some internal polling on a week-to-week basis, or how does that work to gauge?

it works exactly the same as the Presidential. We run our campaign and we then take polls. We will continue to take polls by geographic area, to see where we need to spend more or less money, and quite frankly also, we will be looking at polls to determine what message we should send. The messages that we send in the southern part of the state where the Casino will be located, might be different than where it is in the north where the Casino won't be as close.

And your understanding of previous efforts, is that an area that maybe they were not as targeted as they should have been?

That is the information we have been given.

Okay. All right. I think that's it for me. I will just queue back in, if I need to. Thanks.

Your next question comes from Clint Morrison. You may proceed.

Hello guys, going back to the $8 million you just talked about, is that essentially what you had anticipated at this point, spending through August?

Through July, yes.

Through July. And was there any spending prior to the 1.6 in this quarter, or do we assume that essentially we got about 6.5 million between now and the ends of July.

That's right, Clint.

Okay. And in the management fees, I think you kind of said anecdotally around $400,000, but I thought I heard you say it was up 29% from a year ago, and my question was, was there management fees from a year ago, other than from Cimarron?

No, a year ago has only been Cimarron.

I looked back and it looked like that was a number over $400,000, which suggested that your management fee from Cimarron at this time, should have been a little over $500,000.

No, it's running about the same as a year ago.

Okay. And as you guys get into the heat of this battle at Ohio, I guess the question is, whatever the number is you end up spending, is it all coming out of your pocket, or do your partners end up picking up any of this?

All coming out of our pocket.

Okay. Now assuming we spend our money, and this occurs with the referendum and it votes positively, we got 18 months until we start construction, can you give us some kind of sense of what kind of expense load, comes out of your pocket in that 18 months?

Again, all of the expense load comes out of our pocket, our partners brought to us certainly the idea they had secured options on the land that the Casino would be built on, and give their full faith and work ethic to work full time on this project.

Okay. So the question is if we--

All the monies that we expend, of course our loans to the project, we get paid those loans back.

Even this up front promotional kind of stuff, to get the actual vote is all loaned to the project?

Yes, but of course if it fails, the project has no money.

I realize that.

But it's, but if it's successful, all monies loaned to the project, past, present, and future, will all be repaid with trust from the project.

Okay. And if the referendum passes, we will continue obviously to the expend a lot of money, until we start actually going out and get the big dollars to start construction. What do you think we spend in that 18 months?

When you say a lot of money, it's just primary architects and engineering, at that time frame. I don't think we put an estimate on it yet, but it's certainly know where near what we would have already spent to get the project.

Okay. That sounds reasonable. Okay. That takes care of me for the moment. Thanks.

Your next question comes from [Reshee Parik], you may proceed.

Hello, Tim. I've been looking at the Shingle Springs webcam, and trying to get a sense for what your level of confidence is, that this thing is going to be open by year end, because just by recollection of where Pokagon was eight months before it was supposed to open, and if we look at pictures of-- there's a Snoqualmie Casino that's supposed to be opening in Washington around the same time. Those both look further along than Shingle Springs looks today, and I was wondering if you can sort of take us from where we are today, to how this thing opens up by the end of the year.

I'm actually sitting at the construction trailer at Shingle Springs right now, just got through walking the property, and I can assure you that-- highly confident this will be open before the end of the year.

And we are not worrying about having some sort of a piece by piece, some amenities not others, but you think it gets open in its entirety by the originally contemplated time?

Yes, I do.

And --

The webcam is getting to the point where it's just a little misleading, because you can't really see what's going on from that particular angle. We just don't have a better angle to put it at.

And we saw that you guys had hired Peter Fordham. Can you, are there any other updates you can give us about your staffing, and what you are doing right now or-- ?

Peter was the first piece of the puzzle, obviously get the general manager in place. We were excited to have him, he's someone who comes with a lot of experience, both in Casino management throughout all levels of the Casino, and plus obviously, we worked with him in the past. He was our general manager at Grand Casino Coushatta for a number of years, a very large project, so he knows how to run large Casino and hotel projects, and he has had opening experience. So we are excited about Peter, and right now based on our preopening timetables, we are actively interviewing, and taking applications for the rest of the team, to get put in place.

Thank you.

Your next question comes from Pat McDavis, you may proceed.

This is for Lyle Berman. I had the pleasure of meeting you when you were in Texas at a meeting with [Crandall Eddington], (inaudible) and Eric [Lindgrun] attended. I had two questions. Number one, it involved the WPTE, I believe if I'm pronouncing it correctly, you've got a new company, I think Cryptologic developed the software, and I was wondering how that software compares with Full Tilt, and when it should live, and you all are taking bets from poker players online again?

Well, Cryptologic of course is not new. They've been in this business for quite sometime. They are new to us, but prior to WPTE engaging them to run the site for us, they've been at it for a number of years, and have been running it to other people. If you want to compare it to Full Tilt, I would say that it's not as good as Full Tilt today. There are a number of efforts in, what we call the next releases, to make it so. I would say a Full Tilt is a ten, I'm going to just give a kind of, it's like maybe a seven, and I think within the next 12 months it should be equal or better than Full Tilt.

My second question, I guess it's kind of loaded, but I've been holding this stock for quite sometime, when do you expect to be profitable?

Well, I think it's only fair to say that World Poker Tours conference call, I think it was yesterday, and this is a Lakes one, but of course, we are very intimate in it, we have not predict add profitability for it at this point, but we certainly have shown to-- Steve Lipscomb talked yesterday on the conference call, and talked about all of the efforts that are going forward to monetize the brand, and I think probably it would be best at this point, to actually to refer you to his conference call yesterday, and you can, if not, if you don't have access to it, just e-mail me at L.Berman@Lakes Entertainment.com, and I will give you the call in number that you can hear it there.

And what about Lakes?

When we expect to be profitable?

Yes, sir.

We expect to be profitable in, next year, in 2009.

Thank you so much.

(OPERATOR INSTRUCTIONS). And you have no questions at this time. I would like to turn it back over to management.

Well, we thank you all for joining us. We are very excited about the Casinos that we are running, the Casino we are about to run in Sacramento, and of course, our effort in Ohio is a major effort on our part. We think we gave you some very interesting arguments, we think, and quantified why we believe we will be successful. With that thank you very much and we look forward to you next quarter. Tim?

Thank you everybody for joining us.

Thank you for attending today's conference. This concludes your presentation. You may now disconnect. Good day.