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EXCEL - IDEA: XBRL DOCUMENT - CENTURY CASINOS INC /CO/Financial_Report.xls
EX-32.2 - EXHIBIT 32.2 HOETZINGER - CENTURY CASINOS INC /CO/ex32-2.htm
EX-32.3 - EXHIBIT 32.3 STAPLETON - CENTURY CASINOS INC /CO/ex32-3.htm
EX-31.3 - EXHIBIT 31.3 STAPLETON - CENTURY CASINOS INC /CO/ex31-3.htm
EX-32.1 - EXHIBIT 32.1 HAITZMANN - CENTURY CASINOS INC /CO/ex32-1.htm
EX-31.2 - EXHIBIT 31.2 HOETZINGER - CENTURY CASINOS INC /CO/ex31-2.htm
EX-31.1 - EXHIBIT 31.1 HAITZMANN - CENTURY CASINOS INC /CO/ex31-1.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 
FORM 10-Q

 
þ  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 
For the quarterly period ended September 30, 2011

 
 OR

 
 ¨  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 
 For the transition period from ____________ to ___________

 
Commission file number                                                                           0-22900
 
CNTY LOGO

 
CENTURY CASINOS, INC.
(Exact name of registrant as specified in its charter)
 
DELAWARE
84-1271317
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)

 
2860 South Circle Drive, Suite 350, Colorado Springs, Colorado 80906
(Address of principal executive offices, including zip code)
 
(719) 527-8300
(Registrant’s telephone number, including area code)

 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ  No ¨
 
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes þ  No ¨

 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
             
  Large accelerated filer ¨
 
Accelerated filer ¨
 
Non-accelerated filer ¨
 
Smaller reporting company þ
       
(Do not check if a smaller reporting company)
   

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes ¨  No þ
 
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practical date:
23,877,362 shares of common stock, $0.01 par value per share, were outstanding as of November 1, 2011.
 
1

 

 
 
 
CENTURY CASINOS, INC.
 
 
FORM 10-Q INDEX
 
     
Page
PART I
 
FINANCIAL INFORMATION
Number
       
Item 1.
 
Condensed Consolidated Financial Statements
 
   
 
Condensed Consolidated Balance Sheets as of September 30, 2011 (unaudited) and December 31, 2010
   
 
Condensed Consolidated Statements of Earnings for the Three and Nine Months ended September 30, 2011 and 2010
   
 
Condensed Consolidated Statements of Comprehensive (Loss) Earnings for the Three and Nine Months ended September 30, 2011 and 2010
   
    Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2011 and 2010
 
   
 
Notes to Condensed Consolidated Financial Statements
 
Item 2.
 
 
Management’s Discussion and Analysis of Financial Condition and Results of Operations
 
Item 3.
 
 
Quantitative and Qualitative Disclosures About Market Risk
 
 
Item 4.
 
 
Controls and Procedures
 
       
PART II
 
OTHER INFORMATION
 
       
Item 2.
 
Unregistered Sales of Equity Securities and Use of Proceeds
 
Item 6.
 
 
Exhibits
 
   
 
SIGNATURES
 
 

 
 
2

 

PART I – FINANCIAL INFORMATION
Item 1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 
CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

 
 
   
September 30,
   
December 31,
 
Amounts in thousands, except for share information
 
2011
   
2010
 
   
(unaudited)
      **  
             
Current Assets:
             
  Cash and cash equivalents
  $ 21,306     $ 21,461  
  Receivables, net
    950       1,088  
  Prepaid expenses
    830       413  
  Inventories
    274       305  
  Other current assets
    1       3  
  Deferred income taxes
    443       197  
Total Current Assets
    23,804       23,467  
                 
Property and equipment, net
    99,357       103,956  
Goodwill
    4,731       4,942  
Equity investment
    3,034       2,806  
Deferred income taxes
    1,263       1,219  
Other assets
    311       336  
Total Assets
  $ 132,500     $ 136,726  
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current Liabilities:
               
  Current portion of long-term debt
  $ 2,106     $ 4,203  
  Accounts payable and accrued liabilities
    5,024       5,151  
  Accrued payroll
    2,111       2,329  
  Taxes payable
    1,984       2,277  
  Deferred income taxes
    100       97  
Total Current Liabilities
    11,325       14,057  
                 
Long-term debt, less current portion
    7,339       9,305  
Deferred income taxes
    2,055       1,866  
Total Liabilities
    20,719       25,228  
                 
Commitments and Contingencies
               
                 
Shareholders’ Equity:
               
  Preferred stock; $0.01 par value; 20,000,000 shares authorized;
               
      no shares issued or outstanding
    0       0  
Common stock; $0.01 par value; 50,000,000 shares authorized; 23,993,174 and 23,977,061 shares issued, respectively; 23,877,362 and 23,861,249 shares outstanding, respectively
    240       240  
  Additional paid-in capital
    75,141       74,930  
  Accumulated other comprehensive earnings
    2,623       4,982  
  Retained earnings
    34,059       31,628  
      112,063       111,780  
  Treasury stock – 115,812 shares at cost
    (282 )     (282 )
  Total Shareholders’ Equity
    111,781       111,498  
Total Liabilities and Shareholders’ Equity
  $ 132,500     $ 136,726  
                 
** Derived from the Company's audited consolidated balance sheet at December 31, 2010.
 
See notes to condensed consolidated financial statements.
               


 
3

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)

 
 
   
For the three months ended September 30,
   
For the nine months ended September 30,
 
Amounts in thousands, except for per share information
 
2011
   
2010
   
2011
   
2010
 
                       
  Gaming
  $ 16,236     $ 14,348     $ 46,989     $ 40,169  
  Hotel, bowling, food and beverage
    3,152       2,789       9,536       8,311  
  Other
    956       773       2,895       2,122  
           Gross revenue
    20,344       17,910       59,420       50,602  
Less: Promotional allowances
    (2,198 )     (1,926 )     (6,157 )     (5,541 )
Net operating revenue
    18,146       15,984       53,263       45,061  
Operating costs and expenses:
                               
  Gaming
    7,543       6,289       21,815       17,578  
  Hotel, bowling, food and beverage
    2,565       2,404       7,629       6,742  
  General and administrative
    5,213       4,986       16,429       15,082  
  Depreciation
    1,526       1,529       4,832       4,542  
Total operating costs and expenses
    16,847       15,208       50,705       43,944  
Earnings from equity investment
    249       (32 )     723       316  
Earnings from operations
    1,548       744       3,281       1,433  
Non-operating income (expense):
                               
  Interest income
    6       17       13       39  
  Interest expense
    (186 )     (280 )     (629 )     (861 )
  (Losses) gains on foreign currency transactions & other
    (27 )     14       162       26  
Non-operating income (expense), net
    (207 )     (249 )     (454 )     (796 )
Earnings before income taxes
    1,341       495       2,827       637  
Income tax provision
    (82 )     174       396       446  
Net earnings
   $ 1,423     $ 321     $ 2,431     $ 191  
                                 
Earnings per share:
                               
  Basic
  $ 0.06     $ 0.01     $ 0.10     $ 0.01  
  Diluted
  $ 0.06     $ 0.01     $ 0.10     $ 0.01  
                                 
See notes to condensed consolidated financial statements.
                         
 
 
 
4

 

 
CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) EARNINGS
(Unaudited)

 
 
   
For the three months
   
For the nine months
 
   
ended September 30,
   
ended September 30,
 
                         
Amounts in thousands
 
2011
   
2010
   
2011
   
2010
 
                         
  $ 1,423     $ 321     $ 2,431     $ 191  
Foreign currency translation adjustments
    (3,733 )     1,259       (2,359 )     339  
Comprehensive (loss) earnings
  $ (2,310 )   $ 1,580     $ 72     $ 530  
                                 
See notes to condensed consolidated financial statements.
                 

 
5

 

 
CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 
 
   
For the nine months ended September 30,
 
Amounts in thousands
 
2011
   
2010
 
             
Cash Flows from Operating Activities:
           
             
  $ 2,431     $ 191  
Adjustments to reconcile net earnings to net cash provided by operating activities:
               
Depreciation
    4,832       4,542  
Loss on disposition of fixed assets
    55       68  
Amortization of stock-based compensation
    196       386  
Amortization of deferred financing costs
    51       24  
Deferred tax expense
    (113 )     479  
Earnings from equity investment
    (723 )     (316 )
                 
Changes in operating assets and liabilities:
               
Receivables
  $ 124     $ 78  
Prepaid expenses and other assets
    (425 )     43  
Accounts payable and accrued liabilities
    (323 )     (45 )
Inventories
    16       (9 )
Other operating assets
    (36 )     (83 )
Accrued payroll
    (180 )     129  
Taxes payable
    (252 )     (869 )
Net cash provided by operating activities
    5,653       4,618  
                 
Cash Flows from Investing Activities:
               
Purchases of property and equipment
  $ (2,128 )   $ (6,441 )
Proceeds from disposition of Century Casino Millennium
    0       200  
Acquisition of Century Casino Calgary, net of $1,193 cash acquired
    0       (9,301 )
Proceeds from disposition of assets
    16       64  
Net cash used in investing activities
    (2,112 )     (15,478 )
                 
Cash Flows from Financing Activities:
               
Principal repayments
  $ (3,680 )   $ (1,298 )
Repurchase of common stock
    0       (141 )
Proceeds from equity investment dividend
    163       0  
Proceeds from exercise of options
    15       57  
Net cash used in financing activities
    (3,502 )     (1,382 )

 
-
Continued -

 
6

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued)

 
 
Effect of Exchange Rate Changes on Cash
    (194 )     54  
                 
(Decrease) in Cash and Cash Equivalents
    (155 )     (12,188 )
                 
Cash and Cash Equivalents at Beginning of Period
    21,461       36,992  
Cash and Cash Equivalents at End of Period
  $ 21,306     $ 24,804  
Supplemental Disclosure of Cash Flow Information:
               
Interest paid
  $ 607     $ 845  
Income taxes paid
  $ 188     $ 201  
                 
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
               
Please refer to Note 2 of the Company's condensed consolidated financial statements for details of the Company’s acquisition of the Century Casino Calgary in Alberta, Canada in 2010.
 
See notes to condensed consolidated financial statements.
 
 

 
7

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 

 
Century Casinos, Inc. (together with its wholly owned subsidiaries, the “Company”) is an international casino entertainment company. As of September 30, 2011, the Company owned casino operations in North America; operated cruise ship-based casinos on international waters; and owned the management agreement to manage the casino in the Radisson Aruba Resort, Casino & Spa. The Company also owns a 33.3% ownership interest in Casinos Poland Ltd (“CPL”), the owner and operator of seven casinos in Poland. The Company continues to pursue other projects in various stages of development.
 
The accompanying condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial reporting, the rules and regulations of the Securities and Exchange Commission which apply to interim financial statements and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated.
 
In the opinion of management, all adjustments considered necessary for fair presentation of financial position, results of operations and cash flows of the Company have been included. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010. The results of operations for the period ended September 30, 2011 are not necessarily indicative of the operating results for the full year.
 
Presentation of Foreign Currency Amounts
 
Transactions that are denominated in a foreign currency are translated and recorded at the exchange rate in effect on the date of the transaction. Commitments that are denominated in a foreign currency and all balance sheet accounts other than shareholders’ equity are translated and presented based on the exchange rate between such foreign currency and the U.S. dollar at the end of the reported periods.  Current period transactions affecting the profit and loss of operations conducted in foreign currencies are valued at the average exchange rate between such foreign currency and the U.S. dollar for the period in which they are incurred.
 
The exchange rates to the U.S. dollar used to translate balances at the end of the reported periods are as follows:
 
     
September 30,
   
December 31
 
 
Ending Rates
 
2011
   
2010
 
 
Canadian dollar
    1.0389       0.9946  
 
Euros
    0.7436       0.7468  
 
Polish zloty
    3.2574       2.9641  
 
Source: Pacific Exchange Rate Service
         

The average exchange rates to the U.S. dollar used to translate balances during each reported period are as follows:
 
     
For the three months 
ended September 30,
   
For the nine months
ended September 30,
 
 
Average Rates
 
2011
   
2010
   
2011
   
2010
 
 
Canadian dollar
    0.9797       1.0395       0.9778       1.0362  
 
Euros
    0.7077       0.7741       0.7113       0.7612  
 
Polish zloty
    2.9369       3.1036       2.8576       3.0492  
 
Source: Pacific Exchange Rate Service
                         

 
8

 
 
 
2.
ACQUISITIONS
 
Century Casino Calgary
 
On January 13, 2010, the Company, through Century Casinos Europe (“CCE”), acquired 100% of the issued and outstanding shares of Frank Sisson's Silver Dollar Ltd. (“FSSD”) and 100% of the issued and outstanding shares of EGC Properties Ltd. (“EGC”). FSSD and EGC collectively owned and operated the Silver Dollar Casino and related land in Calgary, Alberta, Canada. In November 2010, the Company rebranded the casino under the name Century Casino Calgary.
 
The total consideration for the transaction was $11.5 million, which consisted of a $10.7 million purchase price plus a net working capital adjustment of $0.8 million. CCE paid $1.0 million of the consideration in November 2009 and the remaining $10.5 million in January 2010. The purchase price was paid from cash on hand. There was no contingent consideration for the transaction.
 
The Company incurred acquisition costs of approximately $0.3 million. The majority of these costs, which include legal, accounting and valuation fees, were recorded as general and administrative expenses during the fourth quarter of 2009.
 
The following table presents the allocation of the purchase price to the assets acquired and liabilities assumed based on their estimated fair values on January 13, 2010, the date of acquisition:
 
 
Amounts in thousands
 
 
Acquisition Date
January 13, 2010
 
Cash
$1,193
 
Accounts receivable
202
 
Prepaid expenses
207
 
Inventory
56
 
Property and equipment
10,977
 
Deferred tax asset, net
                                                            690
 
Total assets acquired
13,325
 
Accounts payable and accrued liabilities
                                                            429
 
Accrued payroll
                                                            222
 
Total liabilities assumed
                                                            651
 
Net assets
                                                       12,674
 
Excess of net assets over purchase consideration (bargain purchase)
                                                       (1,180)
 
Purchase consideration
                                                       11,494
     
 
Cash acquired
                                                       (1,193)
 
Cash deposit made in 2009
                                                       (1,000)
 
Net cash paid in 2010
$9,301

 
During the year ended December 31, 2010, the Company recognized a $1.2 million gain on the bargain purchase associated with the Century Casino Calgary acquisition. The bargain purchase was the result of the fair market value of the assets acquired exceeding the purchase price. Pro forma results of  operations for 2010 have not been presented, as the impact on consolidated financial results would not have been material.
 
 
9

 

 
 
3.           EQUITY INVESTMENT IN UNCONSOLIDATED SUBSIDIARY
 
Following is the summarized financial information of CPL as of September 30, 2011, December 31, 2010 and the three and nine months ended September 30, 2011 and 2010:
 
               
 
Amounts in thousands (in USD):
 
September 30, 2011
   
December 31, 2010
 
 
Balance Sheet:
           
 
    Current assets
  $ 4,444     $ 4,197  
 
    Noncurrent assets
  $ 11,327     $ 10,927  
 
    Current liabilities
  $ 5,624     $ 5,503  
 
    Noncurrent liabilities
  $ 3,388     $ 3,842  
 
     
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
     
2011
   
2010
   
2011
   
2010
 
 
Operating Results
                   
 
Net operating revenue
  $ 13,648     $ 8,955     $ 38,847     $ 33,682  
 
Net earnings
  $ 747     $ (95 )   $ 2,169     $ 949  

The Company’s maximum exposure to losses in CPL at September 30, 2011 was $3.0 million, the value of its equity investment in CPL.
 
Changes in the carrying amount of the investment in CPL during the nine months ended September 30, 2011 are as follows:
 
 
Amounts in thousands (in USD)
 
 
Balance – December 31, 2010
$2,806
 
Equity Earnings
723
 
Effect of foreign currency translation
(332)
 
Dividend
(163)
 
Balance – September 30, 2011
$3,034

4.           GOODWILL
 
Changes in the carrying amount of goodwill for the nine months ended September 30, 2011 are as follows:
 
 
Amounts in thousands
 
 
Balance – December 31, 2010
$4,942
 
Effect of foreign currency translation
($211)
 
Balance – September 30, 2011
$4,731

 
10

 
 
5.           PROMOTIONAL ALLOWANCES

 
Hotel accommodations, bowling and food and beverage furnished without charge to customers are included in gross revenue at a value which approximates retail and are then deducted as complimentary services to arrive at net operating revenue.
 
The Company issues coupons for the purpose of generating future revenue. The cost of the coupons redeemed is applied against the revenue generated on the day of the redemption. In addition, members of the Company’s casinos’ player clubs earn points based on, among other things, their volume of play at the Company’s casinos. Players can accumulate points over time that they may redeem at their discretion under the terms of the program. Points can be redeemed for cash and/or various amenities at the casino, such as meals, hotel stays and gift shop items. The cost of the points is offset against the revenue in the period in which the revenue generated the points. The value of unused or unredeemed points is included in accounts payable and accrued liabilities on the Company’s consolidated balance sheets. The expiration of unused points results in a reduction of the liability.
 
Promotional allowances presented in the condensed consolidated statement of earnings include the following:
 
     
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
     
2011
   
2010
   
2011
   
2010
 
 
Amounts in thousands
                       
 
Hotel, Bowling, Food & Beverage
  $ 960     $ 834     $ 2,701     $ 2,328  
 
Free Plays or Coupons
    566       556       1,513       1,665  
 
Player Points
    672       536       1,943       1,548  
 
Total Promotional Allowances
  $ 2,198     $ 1,926     $ 6,157     $ 5,541  


6.           INCOME TAXES

The Company records deferred tax assets and liabilities based on the difference between the financial statement and income tax basis of assets and liabilities using the enacted statutory tax rate in effect for the year these differences are expected to be taxable or reversed. Deferred income tax expenses or credits are based on the changes in the asset or liability from period to period. The recorded deferred tax assets are reviewed for impairment on a quarterly basis by reviewing the Company’s internal estimates for future net income.

As of September 30, 2011, the Company has established a valuation allowance for its U.S. deferred tax assets of $5.6 million and a valuation allowance for its foreign deferred tax assets of $0.8 million. The Company assesses the continuing need for a valuation allowance that results from uncertainty regarding its ability to realize the benefits of the Company’s deferred tax assets. The ultimate realization of deferred income tax assets depends on generation of future taxable income during the periods in which those temporary differences become deductible. If the Company concludes that its prospects for the realization of its deferred tax assets are more likely than not, the Company will then reduce its valuation allowance as appropriate and credit income tax expense after considering the following factors:

 
·  
The level of historical taxable income and projections for future taxable income over periods in which the deferred tax assets would be deductible,
 
·  
Accumulation of net income before tax utilizing a look-back period of three years, and
 
·  
Tax planning strategies.

 
11

 
 
The income tax provisions are based on estimated full-year earnings for financial reporting purposes adjusted for permanent differences. The Company’s provision for income taxes from operations consists of the following:
 
     
For the nine months ended
 
     
September 30,
 
 
Amounts in thousands
 
2011
   
2010
 
 
U.S. Federal - Current
  $ 72     $ 112  
 
U.S. Federal - Deferred
    0       0  
 
Provision for U.S. federal income taxes
    72       112  
                   
 
Foreign - Current
  $ 437     $ 0  
 
Foreign - Deferred
    (113 )     334  
 
Provision for foreign income taxes
    324       334  
 
Total provision for income taxes
  $ 396     $ 446  


The Company’s income tax expense by jurisdiction is summarized in the table below:
 
 
 
Amounts in thousands
 For the three months
ended September 30, 2011
 
 For the three months
ended September 30, 2010
   
Pre-tax income (loss)
Income tax
Effective
 
Pre-tax income (loss)
Income tax
Effective
       
tax rate
     
tax rate
 
Canada
$557
($130)
(23.3%)
 
$311
$85
27.3%
 
United States
                (31)
                 20
(64.5%)
 
                403
                 81
20.1%
 
Mauritius
                496
                 27
5.4%
 
                243
                   7
3.0%
 
Austria
                 90
                   1
0.5%
 
               (338)
                   1
(0.3%)
 
Poland *
                229
0
0.0%
 
               (124)
0
0.0%
 
Total
$1,341
($82)
(6.1%)
 
$495
$174
35.2%
 
* Poland includes earnings from the equity investment in CPL.
   
                 
 
Amounts in thousands
 For the nine months
ended September 30, 2011
 
For the nine monhts
ended September 30, 2010
   
Pre-tax income (loss)
Income tax
Effective
 
Pre-tax income (loss)
Income tax
Effective
       
tax rate
     
tax rate
 
Canada
$1,814
$273
15.1%
 
$1,279
$319
25.0%
 
United States
            (1,087)
                 72
(6.6%)
 
               (305)
                112
(36.7%)
 
Mauritius
             1,629
                 49
3.0%
 
                453
                 13
2.9%
 
Austria
               (132)
                   2
(1.5%)
 
               (992)
                   2
(0.2%)
 
South Africa
0
0
0.0%
 
                  (6)
0
0.0%
 
Poland *
603
0
0.0%
 
                208
0
0.0%
 
Total
$2,827
$396
14.0%
 
$637
$446
70.0%
 
* Poland includes earnings from the equity investment in CPL.
   

 
12

 
 
7.           EARNINGS PER SHARE
    
 
The calculation of basic earnings per share considers only weighted average outstanding common shares in the computation. The calculation of diluted earnings per share gives effect to all potentially dilutive securities. The calculation of diluted earnings per share is based  upon  the  weighted  average  number of common shares outstanding during the period, plus, if dilutive, the assumed exercise of stock options using the treasury stock method and the assumed conversion of other convertible securities (using the “if converted” method) at the beginning of the year, or for the period outstanding during the year for current year issuances. Weighted average shares outstanding for the three and nine months ended September 30, 2011 and 2010 were as follows:
 
     
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
     
2011
   
2010
   
2011
   
2010
 
 
Weighted average common shares, basic
    23,877,362       23,678,795       23,715,224       23,584,079  
 
Dilutive effect of stock options
    313,890       172,315       299,915       187,851  
 
Weighted average common shares, diluted
    24,191,252       23,851,110       24,015,139       23,771,930  

The following stock options are anti-dilutive and have not been included in the calculation of weighted average shares outstanding:

     
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
     
2011
   
2010
   
2011
   
2010
 
 
Stock options
    886,710       926,710       886,710       926,710  


 
13

 

8.           SEGMENT INFORMATION

The following summary provides information concerning amounts attributable to the Company’s principal geographic areas:
 
     
Long Lived Assets
 
     
As of September 30,
   
As of December 31,
 
 
Amounts in thousands
 
2011
   
2010
 
 
United States
  $ 56,263     $ 57,904  
 
International:
               
 
   Canada
  $ 47,658     $ 50,474  
 
   Europe
    3,281       3,102  
 
   Cruise Ships & Other
    1,494       1,779  
 
Total international
    52,433       55,355  
 
Total
  $ 108,696     $ 113,259  
 
 

     
Net Operating Revenue
   
Net Operating Revenue
 
     
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
 
Amounts in thousands
 
2011
   
2010
   
2011
   
2010
 
 
United States
  $ 8,257     $ 7,858     $ 23,227     $ 21,123  
 
International:
                               
 
   Canada
  $ 8,301     $ 7,256     $ 25,294     $ 21,953  
 
   Cruise Ships & Other
  $ 1,588       870     $ 4,742       1,985  
 
Total international
    9,889       8,126       30,036       23,938  
 
Total
  $ 18,146     $ 15,984     $ 53,263     $ 45,061  

 
14

 

 
 
RESULTS OF OPERATIONS
 
Forward-Looking Statements, Business Environment and Risk Factors
 
This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995. In addition, Century Casinos, Inc. (together with its subsidiaries, the “Company”) may make other written and oral communications from time to time that contain such statements. Forward-looking statements include statements as to industry trends and future expectations of the Company and other matters that do not relate strictly to historical facts and are based on certain assumptions by management at the time such statements are made.  These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” and similar expressions or variations. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements include, among others, the risks described in the section entitled “Risk Factors” under Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2010. We caution the reader to carefully consider such factors. Furthermore, such forward-looking statements speak only as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.
 
References in this item to “we,” “our,” or “us” are to the Company and its subsidiaries on a consolidated basis unless the context otherwise requires.

Amounts presented in this Item 2 are rounded. As such, rounding differences could occur in period over period changes and percentages reported throughout this Item 2.
 
OVERVIEW
 
Since our inception in 1992, we have been primarily engaged in developing and operating gaming establishments and related lodging, restaurant and entertainment facilities. Our primary source of revenue is from the net proceeds of our gaming machines and tables, with ancillary revenue generated from the hotel, restaurant, bowling and entertainment facilities that are a part of the casinos.
 
We currently own, operate and manage the following casinos through wholly-owned subsidiaries:
 
 
  
The Century Casino & Hotel in Edmonton, Alberta, Canada;
  
The Century Casino Calgary, Alberta, Canada;
 
The Century Casino & Hotel in Cripple Creek, Colorado; and
  The Century Casino & Hotel in Central City, Colorado.
 

 
15

 

We also operate ship-based casinos on international waters aboard several cruise ships. The following table summarizes the cruise lines for which we have entered into agreements and the associated ships on which we currently operate ship-based casinos.
 
 
Cruise Line
Ship
Oceania Cruises
Regatta
Oceania Cruises
Nautica
Oceania Cruises
Insignia
Oceania Cruises
Marina
TUI Cruises
Mein Schiff 1
TUI Cruises
Mein Schiff 2
Windstar Cruises
Wind Surf
Windstar Cruises
Wind Star
Windstar Cruises
Wind Spirit
Regent Seven Seas Cruises
Seven Seas Voyager
Regent Seven Seas Cruises
Seven Seas Mariner
Regent Seven Seas Cruises
Seven Seas Navigator
 
We hold a 33.3% ownership interest in and actively participate in the management of CPL, the owner and operator of seven full casinos in Poland and account for this investment under the equity method.
 
In April 2011, CPL was granted a license for a new casino in Sosnowiec, Poland. Sosnowiec is a city of more than 200,000 inhabitants located nearby Katowice, the capital of the province Silesia, which we believe is one of the strongest economic regions in Poland. CPL expects to begin operations in this new casino during the second quarter of 2012. In addition, the license for the existing CPL casino in Wroclav was renewed on June 7, 2011.
 
In December 2010, we entered into a long-term management agreement to assist in the operation of a casino at the Radisson Aruba Resort, Casino & Spa. We receive a management fee consisting of a fixed fee, plus a percentage of the casino’s gross revenue and a percentage of the casino’s earnings before interest, taxes, depreciation and amortization. We were not required to invest any amounts under the management agreement.

 
16

 

Presentation of Foreign Currency Amounts - The average exchange rates to the U.S. dollar used to translate balances during each reported period are as follows:
 
   
For the three months
ended September 30,
   
For the nine months
ended September 30,
 
Average Rates
 
2011
   
2010
   
2011
   
2010
 
Canadian dollar
    0.9797       1.0395       0.9778       1.0362  
Euros
    0.7077       0.7741       0.7113       0.7612  
Polish zloty
    2.9369       3.1036       2.8576       3.0492  
Source: Pacific Exchange Rate Service
                         

RECENT DEVELOPMENTS
 
Developments that we believe have impacted or will impact our results of operations are discussed below.
 
Century Casino & Hotel (Edmonton, Alberta, Canada)
 
The Alberta Gaming and Liquor Commission approved the addition of 16 slot machines to the gaming floor during the third quarter of 2011. The 16 additional machines bring the total slot machine count to 700 at our property in Edmonton.
 
Century Casino Calgary (Calgary, Alberta, Canada)
 
During the third quarter of 2011, an additional Ultimate Texas Hold’em table and a Craps table were added to the gaming floor at our property in Calgary.
 
In addition, we intend to invest $0.2 million to add a 24-hour poker room to the casino in Calgary. The property plans to begin construction of this room during the fourth quarter of 2011 and expects the room to be completed and operational during the first quarter of 2012.
 
Century Casino & Hotel (Central City, Colorado)
 
A competitor in Central City, the Johnny Z Casino, completed an expansion project during the third quarter of 2011, adding 50 additional slot machines and a VIP lounge. Management believes the expansion will increase competition in the already competitive Black Hawk and Central City market.
 
In addition, in September 2011, our property in Central City was voted the second best casino in the greater Denver area by ABC Channel 7 in Denver, Colorado. The Central City property placed second only behind Ameristar Casino in Black Hawk, Colorado.
 
 
17

 

 
DISCUSSION OF RESULTS

Century Casinos, Inc. and Subsidiaries
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming Revenue
  $ 16,236     $ 14,348     $ 1,888       13.2 %   $ 46,989     $ 40,169     $ 6,820       17.0 %
Hotel, Bowling, Food and Beverage Revenue
    3,152       2,789       363       13.0 %     9,536       8,311       1,225       14.7 %
Other Revenue
    956       773       183       23.7 %     2,895       2,122       773       36.4 %
Gross Revenue
    20,344       17,910       2,434       13.6 %     59,420       50,602       8,818       17.4 %
Less Promotional Allowances
    (2,198 )     (1,926 )     (272 )     14.1 %     (6,157 )     (5,541 )     (616 )     11.1 %
Net Operating Revenue
    18,146       15,984       2,162       13.5 %     53,263       45,061       8,202       18.2 %
Gaming Expenses
    (7,543 )     (6,289 )     (1,254 )     19.9 %     (21,815 )     (17,578 )     (4,237 )     24.1 %
Hotel, Bowling, Food and Beverage Expenses
    (2,565 )     (2,404 )     (161 )     6.7 %     (7,629 )     (6,742 )     (887 )     13.2 %
General and Administrative Expenses
    (5,213 )     (4,986 )     (227 )     4.6 %     (16,429 )     (15,082 )     (1,347 )     8.9 %
Total Operating Costs and Expenses
    (16,847 )     (15,208 )     (1,639 )     10.8 %     (50,705 )     (43,944 )     (6,761 )     15.4 %
Earnings from Equity Investment
    249       (32 )     281       878.1 %     723       316       407       128.8 %
Earnings from Operations
    1,548       744       804       108.2 %     3,281       1,433       1,848       129.0 %
Net Earnings
  $ 1,423     $ 321     $ 1,102       343.3 %   $ 2,431     $ 191     $ 2,240       1172.8 %
                                                                 
Earnings Per Share
                                                               
    Basic
  $ 0.06     $ 0.01     $ 0.05       500.0 %   $ 0.10     $ 0.01     $ 0.09       900.0 %
    Diluted
  $ 0.06     $ 0.01     $ 0.05       500.0 %   $ 0.10     $ 0.01     $ 0.09       900.0 %

Net operating revenue increased by $2.2 million, or 13.5%, and $8.2 million, or 18.2%, for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively. Net operating revenue increased at all properties except Central City for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. Net operating revenue increased at all properties for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. Following is a breakout of net operating revenue by property for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively:
 
 
·  
Net operating revenue at our property in Edmonton increased by $0.6 million, or 10.6%, and $1.6 million, or 10.2%
 
·  
Net operating revenue at our property in Calgary increased by $0.5 million, or 24.5%, and $1.7 million, or 29.3%
 
·  
Net operating revenue at our property in Central City decreased by $0.1 million, or 2.0%, and increased by $0.4 million, or 3.3%
 
·  
Net operating revenue at our property in Cripple Creek increased by $0.5 million, or 16.5%, and $1.7 million, or 21.0%
 
·  
Net operating revenue from our ship-based casinos and other increased by $0.7 million, or 82.5%, and $2.8 million, or 138.8%
 
 
 
18

 
 
Total operating costs and expenses increased by $1.6 million, or 10.8%, and $6.8 million, or 15.4%, for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively. Total operating costs increased at all of our properties for both the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010. Following is a breakout of total operating costs and expenses by property for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively:
 
·  
Total operating costs and expenses at our property in Edmonton increased by $0.3 million, or 8.4%, and $0.9 million, or 7.2%
 
·  
Total operating costs and expenses at our property in Calgary increased by $0.4 million, or 19.4%, and $1.8 million, or 31.0%
 
·  
Total operating costs and expenses at our property in Central City increased by less than $0.1 million, or 0.8%, and $0.5 million, or 4.3%
 
·  
Total operating costs and expenses at our property in Cripple Creek increased by $0.3 million, or 11.2%, and $0.9 million, or 11.5%
 
·  
Total operating costs and expenses for our ship-based casinos and other increased by $0.6 million, or 75.8%, and $2.5 million, or 130.2%
 
·  
Total operating costs and expenses for corporate other decreased by $0.1 million, or 5.8%, and $0.2 million, or 4.9%
 
 
Net earnings increased by $1.1 million and $2.2 million for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively. Net earnings increased at all of our properties except Central City for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. Net earnings increased at all of our properties except for Central City and Calgary for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. Following is a breakout of net earnings by property for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively:
 
·  
Net earnings at our property in Edmonton increased by $0.4 million and $0.9 million
 
·  
Net earnings at our property in Calgary increased by $0.2 million and decreased by $0.1 million
 
·  
Net earnings at our property in Central City decreased by $0.1 million and less than $0.1 million
 
·  
Net earnings at our property in Cripple Creek increased by $0.1 million and $0.5 million
 
·  
Net earnings from our ship-based casinos increased by $0.1 million and $0.3 million
 
 
Results by property are discussed in further detail in the following pages.
 
 
19

 

Casinos

Edmonton
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming
  $ 4,285     $ 3,788     $ 497       13.1 %   $ 12,821     $ 11,453     $ 1,368       11.9 %
Hotel, Food and Beverage
    1,359       1,237       122       9.9 %     4,230       3,828       402       10.5 %
Other
    447       446       1       0.2 %     1,445       1,380       65       4.7 %
Gross Revenue
    6,091       5,471       620       11.3 %     18,496       16,661       1,835       11.0 %
Less Promotional Allowances
    (239 )     (179 )     (60 )     33.5 %     (705 )     (513 )     (192 )     37.4 %
Net Operating Revenue
    5,852       5,292       560       10.6 %     17,791       16,148       1,643       10.2 %
Gaming Expenses
    (1,593 )     (1,554 )     (39 )     2.5 %     (4,886 )     (4,663 )     (223 )     4.8 %
Hotel, Food and Beverage Expenses
    (980 )     (847 )     (133 )     15.7 %     (2,862 )     (2,558 )     (304 )     11.9 %
General & Administrative Expenses
    (1,343 )     (1,204 )     (139 )     11.5 %     (4,104 )     (3,829 )     (275 )     7.2 %
Total Operating Costs and Expenses
    (4,289 )     (3,955 )     (334 )     8.4 %     (12,966 )     (12,097 )     (869 )     7.2 %
Earnings from Operations
    1,563       1,337       226       16.9 %     4,825       4,051       774       19.1 %
Net Earnings
  $ 1,149     $ 769     $ 380       49.4 %   $ 3,242     $ 2,340     $ 902       38.5 %

Three Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Edmonton increased by $0.6 million, or 10.6%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase is primarily due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.8% for the three months ended September 30, 2011 as compared to the three ended September 30, 2010. In Canadian dollars, net operating revenue increased $0.2 million, or 4.2%, for the three months ended September 30, 2011 as compared to the three months ended September 30, 2010. The increase in net operating revenue is also due to increased gaming revenue of $0.5 million, or 13.1%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010 due to 16 additional slot machines added to the floor during the third quarter of 2011, increased customer volumes and an increase in table games hold percentage.

Net operating revenue also increased due to higher hotel, food and beverage revenue of $0.1 million, or 9.9%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in hotel, food and beverage revenue is mainly the result of an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.8% for the three months ended September 30, 2011 as compared to the three months ended September 30, 2010. In Canadian dollars, hotel, food and beverage revenue increased less than $0.1 million, or 3.6%, for the three months ended September 30, 2011 as compared to the three months ended September 30, 2010.

Total operating costs and expenses increased by $0.3 million, or 8.4%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. In Canadian dollars, total operating costs and expenses increased by $0.1 million, or 2.4%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. Total operating costs increased mainly due to increased property taxes and maintenance service contracts.

Net earnings increased by $0.4 million for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. In Canadian dollars, net earnings decreased by $0.2 million for the three months ended September 30, 2011 as compared to the three months ended September 30, 2010.

 
20

 
 
Nine Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Edmonton increased by $1.6 million, or 10.2%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase is primarily due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.6% for the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010. In Canadian dollars, net operating revenue increased $0.6 million, or 4.0%, for the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010. The increase in net operating revenue is also due to increased gaming revenue of $1.4 million, or 11.9%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in gaming revenue is due to an overall increase in customer volumes and table games hold percentages during 2011.

Net operating revenue also increased due to higher hotel, food and beverage revenue of $0.4 million, or 10.5%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in hotel, food and beverage revenue was the result of an overall increase in customer volumes during the year, increased food and beverage revenue from the Yuk Yuk’s Comedy Club and an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.6% for the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010. In Canadian dollars, hotel, food and beverage revenue increased $0.2 million, or 4.3%, for the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010, respectively.

Promotional allowances increased by $0.2 million, or 37.4%, for the nine month ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, promotional allowances increased by $0.2 million, or 29.8%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2011 due to increased player’s club point redemption.

Total operating costs and expenses increased by $0.9 million, or 7.2%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 primarily due to the increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.6% for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, total operating costs and expenses increased by $0.2 million, or 1.2%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

Net earnings increased by $0.9 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, net earnings decreased by $0.2 million for the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010.
 
 
21

 

Calgary
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming
  $ 1,661     $ 1,373     $ 288       21.0 %   $ 4,825     $ 3,878     $ 947       24.4 %
Bowling, Food and Beverage
    652       491       161       32.8 %     2,363       1,727       636       36.8 %
Other
    259       193       66       34.2 %     695       428       267       62.4 %
Gross Revenue
    2,572       2,057       515       25.0 %     7,883       6,033       1,850       30.7 %
Less Promotional Allowances
    (126 )     (93 )     (33 )     35.5 %     (380 )     (229 )     (151 )     65.9 %
Net Operating Revenue
    2,446       1,964       482       24.5 %     7,503       5,804       1,699       29.3 %
Gaming Expenses
    (1,018 )     (660 )     (358 )     54.2 %     (2,876 )     (2,033 )     (843 )     41.5 %
Bowling, Food and Beverage Expenses
    (592 )     (647 )     55       (8.5 %)     (1,975 )     (1,658 )     (317 )     19.1 %
General & Adminstrative Expenses
    (740 )     (747 )     7       (0.9 %)     (2,334 )     (2,051 )     (283 )     13.8 %
Total Operating Costs and Expenses
    (2,544 )     (2,131 )     (413 )     19.4 %     (7,762 )     (5,927 )     (1,835 )     31.0 %
Losses from Operations
    (98 )     (167 )     69       (41.3 %)     (259 )     (123 )     (136 )     110.6 %
Net Earnings (Loss)
  $ 74     $ (119 )   $ 193       162.2 %   $ (152 )   $ (87 )   $ (65 )     (74.7 %)

Three Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Calgary increased by $0.5 million, or 24.5%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. Net operating revenue increased due to higher gaming and bowling, food and beverage revenue of $0.5 million, or 24.1%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in gaming revenue is due to increased customer volumes and an increase in table games hold percentage. The increase in bowling, food and beverage revenue is due to an increase in the number and types of shows offered in the property’s showrooms, increased food quality at each restaurant and bar, additional customer volumes in the casino and improved customer service.

The increase in net operating revenue is also due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.8% for the three months ended September 30, 2011 as compared to the three months ended September 30, 2010. In Canadian dollars, net operating revenue increased $0.4 million, or 17.4%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.

Total operating costs and expenses increased by $0.4 million, or 19.4%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in operating costs and expenses is due to additional marketing costs for promotional prizes and events, increased loyalty membership direct mailing costs and additional staffing costs in order to provide improved customer service. In addition, total operating costs and expenses increased due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar for the three months ended September 30, 2011 compared to the three months ended September 30, 2010 of 5.8%. In Canadian dollars, total operating costs and expenses in Calgary increased by $0.3 million, or 12.4%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.

Net earnings increased by $0.2 million for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. In Canadian dollars, the net earnings decreased by $0.2 million for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.

 
22

 
 
Nine Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Calgary increased by $1.7 million, or 29.3%. for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. Net operating revenue increased due to higher gaming and bowling, food and beverage revenue of $1.6 million, or 28.2%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010, respectively. The increase in gaming revenue is due to new and converted slot machines added to the gaming floor and overall increased customer volumes during 2011. The increase in bowling, food and beverage revenue is due to new bowling lanes, bowling leagues that utilize our facility, an increase the number and types of shows offered in the property’s showrooms, increased food quality at each restaurant and bar, additional customer volumes in the casino and improved customer service. The increase is also due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.6% for nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010. In Canadian dollars, net operating revenue increased $1.3 million, or 22.1%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

Promotional allowances increased by $0.2 million, or 65.9%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, promotional allowances increased by $0.1 million, or 56.5%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2011 due to the addition of a player’s club point redemption program during the year.

Total operating costs and expenses increased by $1.8 million, or 31.0%, at the Century Casino Calgary during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in operating costs and expenses is due to additional marketing costs for radio advertising, promotional prizes and events as well as increased loyalty membership direct mailing costs and additional staffing costs in order to provide improved customer service. In addition, total operating costs and expenses increased due to an increase in the average exchange rate between the U.S. dollar and Canadian dollar of 5.6% for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, total operating costs and expenses in Calgary increased by $1.5 million, or 23.7%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

Net earnings decreased by $0.1 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. In Canadian dollars, net earnings increased by $0.3 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.


 
23

 
 
Central City
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming
  $ 5,203     $ 5,193     $ 10       0.2 %   $ 14,897     $ 14,311     $ 586       4.1 %
Hotel, Food and Beverage
    701       654       47       7.2 %     1,860       1,758       102       5.8 %
Other
    44       38       6       15.8 %     119       113       6       5.3 %
Gross Revenue
    5,948       5,885       63       1.1 %     16,876       16,182       694       4.3 %
Less Promotional Allowances
    (1,194 )     (1,036 )     (158 )     15.3 %     (3,202 )     (2,951 )     (251 )     8.5 %
Net Operating Revenue
    4,754       4,849       (95 )     (2.0 %)     13,674       13,231       443       3.3 %
Gaming Expenses
    (2,208 )     (2,162 )     (46 )     2.1 %     (6,424 )     (6,016 )     (408 )     6.8 %
Hotel, Food and Beverage Expenses
    (584 )     (519 )     (65 )     12.5 %     (1,622 )     (1,480 )     (142 )     9.6 %
General & Administrative Expenses
    (952 )     (885 )     (67 )     7.6 %     (2,724 )     (2,584 )     (140 )     5.4 %
Total Operating Costs and Expenses
    (4,279 )     (4,243 )     (36 )     0.8 %     (12,624 )     (12,103 )     (521 )     4.3 %
Earnings from Operations
    475       606       (131 )     (21.6 %)     1,050       1,128       (78 )     (6.9 %)
Net Earnings
  $ 302     $ 377     $ (75 )     (19.9 %)   $ 673     $ 716     $ (43 )     (6.0 %)

Three Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Central City decreased by $0.1 million, or 2.0%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The decrease in net operating revenue for the third quarter of 2011 is due to a decrease in slot machine hold percentage and a decrease in the Central City market of 1.29% for the three months ended September 30, 2011 compared to the three months ended September 30, 2011.

Promotional allowances increased by $0.2 million, or 15.3%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in promotional allowances is due to a more aggressive player point redemption program offered during the third quarter of 2011. Total operating costs and expenses increased by less than $0.1 million, or 0.8%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in total operating costs and expenses is due to increased marketing costs for promotional prizes and giveaways and additional staffing costs.

Net earnings decreased by $0.1 million for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.
 
Nine Months Ended September 30, 2011 and 2010
Net operating revenue at our property in Central City and increased by $0.4 million, or 3.3%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in net operating revenue is mainly due to an increase in gaming revenue for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 due to increased table games revenue generated from craps and player banked poker, increased customer volumes that we believe resulted from the disruption at the Fortune Valley Casino in Central City during the transition of its ownership during the first and second quarters of 2011 and increased revenue from slot machines that were moved from the lower level to the main level of the casino.

Promotional allowances increased by $0.3 million, or 8.5%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in promotional allowances was due to a more aggressive player point redemption program offered during the third quarter of 2011.

Total operating costs and expenses increased by $0.5 million, or 4.3%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in total operating costs and expenses is due to increased marketing costs for promotional prizes and giveaways, player participation in bus ridership rewards in which the casino reimburses a portion of players’ bus fare to the casino, increased gaming taxes as a result of higher gaming revenue, and increased staffing costs in order to provide greater customer service.

Net earnings decreased by less than $0.1 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.
 
 
24

 
 
Cripple Creek
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming
  $ 3,674     $ 3,191     $ 483       15.1 %   $ 10,262     $ 8,662     $ 1,600       18.5 %
Hotel, Food and Beverage
    439       408       31       7.6 %     1,083       998       85       8.5 %
Other
    32       28       4       14.3 %     79       80       (1 )     (1.3 %)
Gross Revenue
    4,145       3,627       518       14.3 %     11,424       9,740       1,684       17.3 %
Less Promotional Allowances
    (639 )     (617 )     (22 )     3.6 %     (1,870 )     (1,847 )     (23 )     1.2 %
Net Operating Revenue
    3,506       3,010       496       16.5 %     9,554       7,893       1,661       21.0 %
Gaming Expenses
    (1,493 )     (1,225 )     (268 )     21.9 %     (4,013 )     (3,368 )     (645 )     19.2 %
Hotel, Food and Beverage Expenses
    (409 )     (391 )     (18 )     4.6 %     (1,170 )     (1,050 )     (120 )     11.4 %
General & Administrative Expenses
    (800 )     (755 )     (45 )     6.0 %     (2,347 )     (2,154 )     (193 )     9.0 %
Total Operating Costs and Expenses
    (2,957 )     (2,659 )     (298 )     11.2 %     (8,301 )     (7,443 )     (858 )     11.5 %
Earnings from Operations
    549       351       198       56.4 %     1,253       450       803       178.4 %
Net Earnings
  $ 341     $ 217     $ 124       57.1 %   $ 777     $ 279     $ 498       178.5 %

Three Months Ended September 30, 2011 and 2010
 
Net operating revenue at our property in Cripple Creek increased by $0.5 million, or 16.5%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in net operating revenue is primarily due to an increase in gaming revenue of $0.5 million, or 15.1%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010 due to higher slot revenue from new slot machines, additional table games revenue generated after moving the table games pit from the back of the casino to the front, improved customer service and targeted and higher frequency marketing strategies improving the customer volumes and differentiating our casino from competitors.
 

Total operating costs and expenses increased by $0.3 million, or 11.2%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in total operating costs and expenses is due to increased marketing costs for more aggressive marketing campaigns, increased slot machine royalty fees in order to provide the latest slot machine products, increased gaming taxes as a result of higher gaming revenue and increased staffing costs in order to provide greater customer service.

Net earnings increased by $0.1 million for the three and nine months ended September 30, 2011 compared to the three months ended September 30, 2010.
 
Nine Months Ended September 30, 2011 and 2010
 
Net operating revenue at our property in Cripple Creek increased by $1.7 million, or 21.0%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase is primarily due to an increase in gaming revenue of $1.6 million, or 18.5%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in gaming revenue is due to higher slot revenue from new slot machines, additional table games revenue generated after moving the table games pit from the back of the casino to the front, improved customer service and targeted and higher frequency marketing strategies improving the customer volumes and differentiating our casino from competitors. Finally, we believe slot gaming revenue also improved partly due to a disruption in operations at the J.P. McGills casino in Cripple Creek during a remodeling project which took place during the first quarter of 2011.
 

Total operating costs and expenses increased by $0.9 million, or 11.5%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase in total operating costs and expenses is due to increased marketing costs for more aggressive marketing campaigns, increased slot machine royalty fees in order to provide the latest slot machine products, increased gaming taxes as a result of higher gaming revenue, increased staffing costs in order to provide greater customer service and increased utility costs from colder temperatures during the first quarter of 2011.

Net earnings increased by $0.5 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.
 
 
25

 
 
Cruise Ships and Other
 
   
For the three months
 ended September 30,
   
For the nine months
 ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Gaming
  $ 1,413     $ 803     $ 610       76.0 %   $ 4,185     $ 1,865     $ 2,320       124.4 %
Other
    175       67       108       161.2 %     557       121       436       360.3 %
Net Operating Revenue
    1,588       870       718       82.5 %     4,742       1,986       2,756       138.8 %
Gaming Expenses
    (1,231 )     (689 )     (542 )     78.7 %     (3,615 )     (1,496 )     (2,119 )     141.6 %
General & Administrative Expenses
    (134 )     (123 )     (11 )     8.9 %     (402 )     (195 )     (207 )     106.2 %
Total Operating Costs and Expenses
    (1,477 )     (840 )     (637 )     75.8 %     (4,348 )     (1,889 )     (2,459 )     130.2 %
Earnings from Operations
    111       30       81       270.0 %     394       97       297       306.2 %
Net Earnings
  $ 109     $ 29     $ 80       275.9 %   $ 387     $ 94     $ 293       311.7 %

Three Months Ended September 30, 2011 and 2010
Net operating revenue from our ship-based casinos and other increased by $0.7 million, or 82.5%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase is primarily due to additional management revenue from our Aruba contract and one additional ship-based casino for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010.

Total operating costs and expenses increased by $0.6 million, or 75.8%, for the three months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase is a result of increased concession and annual fees paid to cruise ship operators, which increased by $0.4 million during the three nine months ended September 30, 2011 compared to the three months ended September 30, 2010. The increase in concession and annual fees paid to cruise ships was partially offset by the elimination of start-up costs associated with the setup of three new ships from Regent Seven Seas cruise line completed in September 2010.

Net earnings increased by $0.1 million for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.

Nine Months Ended September 30, 2011 and 2010
Net operating revenue from our ship-based casinos and other increased by $2.8 million, or 138.8%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase is primarily due to additional management revenue from our Aruba contract and additional revenue generated from ship-based casinos for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

Total operating costs and expenses increased by $2.5 million, or 130.2%, for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010. The increase is a result of increased concession and annual fees paid to cruise ship operators, which increased by $1.5 million during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

Net earnings increased by $0.3 million for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.

 
26

 
 
Corporate Other
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
Amounts in thousands
 
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
General & Administrative Expenses
    (1,244 )     (1,272 )     28       (2.2 %)     (4,518 )     (4,265 )     (253 )     5.9 %
Total Operating Costs and Expenses
    (1,301 )     (1,381 )     80       (5.8 %)     (4,704 )     (4,485 )     (219 )     4.9 %
Losses from Operations
    (1,051 )     (1,413 )     362       (25.6 %)     (3,982 )     (4,169 )     187       (4.5 %)
Net Loss
  $ (552 )   $ (952 )   $ 400       (42.0 %)   $ (2,496 )   $ (3,157 )   $ 660       (20.9 %)

General and administrative expenses for Corporate Other consist primarily of legal and accounting fees, corporate travel expenses, corporate payroll, amortization of stock based compensation and other expenses not directly related to any of the Company's individual properties. General and administrative expenses decreased by less than $0.1 million, or 2.2%, and increased by $0.3 million, or 5.9%, for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively. The decrease for the third quarter 2011 is due to decreased stock compensation expense and legal fees and the increase for the nine months ended September 30, 2011 is primarily due to expenses related to an unsuccessful bid for a casino gaming license in Switzerland and increased expenses for professional tax services.
 
Earnings from Equity Investment
 
We own 33.3% of all shares issued by CPL. Our portion of CPL’s earnings are recorded as earnings from equity investment. We recorded an increase of $0.3 million and $0.4 million of earnings from our investment in CPL for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively. The increase is primarily a result of increased gaming revenue offset by accelerated depreciation of leasehold improvements discussed below.
 
On March 9, 2011, CPL was informed that the lease renewal option for the current location of the Krakow casino would not be exercised beyond its current expiration period of December 31, 2011. CPL intends to relocate this casino. Based on this information, the net book value of leasehold improvements completed at the Krakow casino is being written off during 2011. The estimated amount of the additional write off in 2011 is 2.24 million Polish Zloty or $0.8 million, for which our 33.3% interest would be $0.3 million.
 
On July 29, 2011, our co-shareholders in CPL (LOT Polish Airlines and PPL Polish Airports) informed us of their intent to sell their shares in CPL (66.66% of the total shares) to Totalizator Sportowy Group, the state owned Polish national lottery firm. LOT and PPL requested our consent to their respective conditional sales agreement, which is necessary for the legal effectiveness of any share transfers. We are evaluating their request.
 
 
27

 
 
Non-Operating Income (Expense)
 
Non-operating income (expense) for the three and nine months ended September 30, 2011 and 2010 was as follows (in thousands):
 
   
For the three months 
ended September 30,
   
For the nine months 
ended September 30,
 
   
2011
   
2010
   
Change
   
% Change
   
2011
   
2010
   
Change
   
% Change
 
Interest Income
  $ 6     $ 17     $ (11 )     (64.7 %)   $ 13     $ 39     $ (26 )     (66.7 %)
Interest Expense
    (186 )     (280 )     94       (33.6 %)     (629 )     (861 )     232       (26.9 %)
(Losses) Gains on Foreign Currency Transactions & Other
    (27 )     14       (41 )     (292.9 %)     162       26       136       523.1 %
Non-Operating Expense
  $ (207 )   $ (249 )   $ 42       (16.9 %)   $ (454 )   $ (796 )   $ 342       (43.0 %)

Interest expense
 
The decrease in interest expense of $0.1 million and $0.2 million for the three and nine months ended September 30, 2011 compared to the three and nine months ended September 30, 2010, respectively, is due to lower principal balances on third party debt related to our Edmonton property.
 
Taxes
 
Our foreign earnings significantly impact our tax rate. The Company’s income tax expense and effective tax rates by jurisdiction are summarized in the tables below:
 
Amounts in thousands
 
 For the nine months
ended September 30, 2011
   
For the nine months
ended September 30, 2010
 
   
Pre-tax income (loss)
   
Income tax
   
Effective
   
Pre-tax income (loss)
   
Income tax
   
Effective
 
               
tax rate
               
tax rate
 
Canada
  $ 1,814     $ 273       15.1 %   $ 1,279     $ 319       25.0 %
United States
    (1,087 )     72       (6.6 %)     (305 )     112       (36.7 %)
Mauritius
    1,629       49       3.0 %     453       13       2.9 %
Austria
    (132 )     2       (1.5 %)     (992 )     2       (0.2 %)
South Africa
    0       0       0.0 %     (6 )     0       0.0 %
Poland *
    603       0       0.0 %     208       0       0.0 %
Total
  $ 2,827     $ 396       14.0 %   $ 637     $ 446       70.0 %
* Poland includes earnings from the equity investment in CPL.
                 

The effective tax rates of our foreign properties are impacted by the movement of exchange rates primarily due to loans which are denominated in U.S. dollars. Therefore, foreign currency gains or losses recorded in each property’s local currency do not impact our earnings reported in U.S. dollars.
 
 
28

 
 
LIQUIDITY AND CAPITAL RESOURCES
 
Cash Flows
 
Our business is capital intensive, and we rely heavily on the ability of our casinos to generate operating cash flow. We use the cash flows that we generate to maintain operations, fund reinvestment in existing properties for both refurbishment and expansion projects, repay third party debt, and pursue additional growth via new development and acquisition opportunities. When necessary and available, we supplement the cash flows generated by our operations with either cash on hand or funds provided by bank borrowings or other debt or equity financing activities.
 
Cash and cash equivalents totaled $21.3 million at September 30, 2011, and we had working capital (current assets minus current liabilities) of $12.5 million compared to cash and cash equivalents of $21.5 million and working capital of $9.4 million at December 31, 2010. The decline in cash is primarily due to $3.7 million in repayment of third party mortgage debt related to our Edmonton property. In addition, we invested $2.1 million in various capital expenditure projects. These declines were offset by $5.7 million in cash provided by operating activities, a $0.2 million cash dividend received from our equity investment in CPL and a $0.2 million impact on the cash balances due to changes in foreign exchange rates.
 
Net cash provided by operating activities was $5.7 million and $4.6 million for the nine months ended September 30, 2011 and 2010, respectively. Our cash flows from operations have historically been positive and sufficient to fund ordinary operations. Trends in our operating cash flows tend to follow trends in earnings from operations, excluding non-cash charges. Please refer to the condensed consolidated statements of cash flows and management’s discussion of the results of operations above.
 
Net cash used in investing activities of $2.1 million for the nine months ended September 30, 2011 consisted of $0.9 million used to purchase slot machines and a kiosk, replace surveillance cameras, and purchase property in Central City, $0.6 million used in building renovations and electrical upgrades in Calgary, $0.2 million used to purchase slot machines and a kiosk in Cripple Creek, $0.1 million used for gaming equipment additions on cruise ship-based casinos and $0.3 million used in cumulative additions at our remaining properties.
 
Net cash used in investing activities of $15.5 million for the nine months ended September 30, 2010 consisted of $10.5 million used for the acquisition of the Century Casino Calgary (offset by casino cash acquired of $1.2 million), $3.2 million in building renovations, bowling lane and scoring system refurbishment and surveillance system upgrades in Calgary, $2.2 million to purchase land in Cripple Creek, $0.9 million to purchase gaming equipment additions on cruise ship-based casinos placed in service in 2010 and $0.1 of additions for signs and computer equipment in Edmonton. These outflows were offset by $0.2 million in proceeds received from the sale of the Century Casino Millennium. 
 
Net cash used in financing activities of $3.5 million for the nine months ended September 30, 2011 consisted of $3.7 million in the repayment and prepayment of our Edmonton Mortgage debt offset by a $0.2 million cash dividend received from our equity investment in CPL. As of September 30, 2011, the remaining balance on our Edmonton Mortgage debt is $9.4 million. We were in compliance with all covenants of the Edmonton Mortgage loan as of September 30, 2011.
 
Net cash used in financing activities of $1.4 million for the nine months ended September 30, 2010 consisted of repayment of $1.3 million of our Edmonton Mortgage debt and $0.1 million for repurchases of our outstanding common stock pursuant to the publicly announced repurchase program discussed below.
 
 
29

 

Common Stock Repurchase Program
 
Since 2000, we have had a discretionary program to repurchase our outstanding common stock. In November 2009, we increased the amount available to be repurchased to $15.0 million. We did not repurchase any shares of our common stock during the nine months ended September 30, 2011. The total amount remaining under the repurchase program was $14.7 million as of September 30, 2011. The repurchase program has no set expiration or termination date.
 
Potential Sources of Liquidity, Short-Term Liquidity
 
Historically, our primary sources of liquidity and capital resources have been cash flow from operations, bank borrowings, sales of existing casino operations and proceeds from the issuance of equity securities.
 
We expect that the primary source of cash will be from our gaming operations. In addition to the payment of operating costs, expected uses of cash within one year include capital expenditures for our existing properties, interest and principal payments on outstanding debt and potential repurchases of our outstanding common stock. If necessary, we may seek to obtain term loans, mortgages or lines of credit with commercial banks or other debt or equity financings to supplement our working capital and investing requirements.
 
We believe that our cash at September 30, 2011 as supplemented by cash flows from operations will be sufficient to fund our anticipated operating costs, capital expenditures at existing properties and current debt repayment obligations for at least the next 12 months. We will continue to evaluate our planned capital expenditures at each of our existing locations in light of the operating performance of the facilities at such locations. From time to time we expect to have cash needs for the development or purchase of new properties that exceed our current borrowing capacity and we may be required to seek additional debt, equity or bank financing.
 
In addition, we expect our U.S. domestic cash resources will be sufficient to fund our U.S. operating activities and cash commitments for investing and financing activities, such as debt repayment schedules, material capital expenditures and dividends for at least the next 12 months and thereafter for the foreseeable future. While we currently do not have an intent nor foresee a need to repatriate funds, if we require more capital in the U.S. than is generated by our U.S. operations either for operations, capital expenditures or significant discretionary activities such as acquisitions or businesses and share repurchases, we could elect to repatriate earnings from foreign jurisdictions or raise capital in the U.S. through debt or equity issuances, which could have adverse tax consequences as we have not accrued taxes for un-repatriated earnings of our foreign subsidiaries.
 
Item 3.                 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We had no significant changes in our exposure to market risks from that previously reported in our Annual Report on Form 10-K for the year ended December 31, 2010.

Item 4.                 CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures – Our management, with the participation of our Co  Chief Executive Officers and Principal Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this report. Based on such evaluation, our Co Chief Executive Officers and Principal Financial Officer have concluded that as of such date, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting –  There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2011 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


 
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PART II - OTHER INFORMATION

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
In March 2000, our board of directors approved a discretionary program to repurchase up to $5.0 million of our outstanding common stock. In November 2009, our board of directors approved an increase of the amount available to be repurchased under the program to $15.0 million. The repurchase program has no set expiration or termination date and had approximately $14.7 million remaining as of September 30, 2011. There were no repurchases of common stock during the nine months ended September 30, 2011.
 
Item 6. EXHIBITS

 
(a) Exhibits

3.1
Certificate of Incorporation of Century Casinos, Inc. is hereby incorporated by reference to the Company’s Proxy Statement for the 1994 Annual Meeting of Stockholders.
3.2
Amended and Restated Bylaws of Century Casinos, Inc. is hereby incorporated by reference from Exhibit 11.14 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2002.
31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer.
31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer and President.
31.3
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Principal Financial Officer.
32.1
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer.
32.2
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer and President.
32.3
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Principal Financial Officer.
 101.INS  XBRL Instance Document**
 101.SCH  XBRL Taxonomy Extension Schema Document**
 101.CAL
 XBRL Taxonomy Extension Calculation Linkbase Document**
 101.LAB  XBRL Taxonomy Extension Label Linkbase Document**
 101.PRE  XBRL Taxnonmy Extension Presentation Linkbase Document**
** Pursuant to Rule 406T of Regulation S-T, these Interactive Data Files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to the liability under these sections.


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.

CENTURY CASINOS, INC.

/s/ Margaret Stapleton
Margaret Stapleton
Vice President and Principal Financial Officer
Date: November 8, 2011
 
 
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CENTURY CASINOS, INC.
INDEX TO EXHIBITS

Exhibit No.
Document
3.1
Certificate of Incorporation of Century Casinos, Inc. is hereby incorporated by reference to the Company’s Proxy Statement for the 1994 Annual Meeting of Stockholders.
3.2
Amended and Restated Bylaws of Century Casinos, Inc. is hereby incorporated by reference from Exhibit 11.14 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2002.
31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer.
31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer and President.
31.3
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
Principal Financial Officer.
32.1
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer.
32.2
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Co Chief Executive Officer and President.
32.3
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
Principal Financial Officer.
101.INS
XBRL Instance Document**
101.SCH
XBRL Taxonomy Extension Schema Document**
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document**
101.LAB
XBRL Taxonomy Extension Label Linkbase Document**
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document**
 
** Pursuant to Rule 406T of Regulation S-T, these Interactive Data Files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to the liability under these sections.
 
 
 
32