GEYSERVILLE, Calif. -- The River Rock Entertainment Authority (the “Authority”), the operator of the River Rock Casino in Sonoma County, California, today announced second quarter operating results for the period ended June 30, 2011.
We are a Tribal governmental instrumentality of the Dry Creek Rancheria Band of Pomo Indians (the “Tribe”), a federally recognized self-governing Indian tribe. The Tribe has 1,007 enrolled members and approximately 75-acre reservation in Sonoma County, California.The net loss for the six months ended June 30, 2011 totaled $3,950,000, $1.60 per share, compared to net income of $2,708,000, $1.10 per share, for the same period last year. The most significant factor contributing to the decline in second quarter net income was the increased frequency of tornado losses.[Table Omitted]Operating expenses for the second quarter ended June 30, 2011 were $19.2 million. Operating expenses consisted of casino expense of $4.2 million, food and beverage expense of $1.5 million, selling, general and administrative expense of $10.0 million, depreciation expense of $2.6 million, gaming commission and surveillance expense of $0.7 million and compact revenue sharing trust fund expense of $0.3 million.The Authority will host a conference call to discuss second quarter 2011 financial results tomorrow, August 16, 2011 at 1:00 PM ET. The call can be accessed live over the phone by dialing 877-723-9511 or for international callers by dialing 719-325-4898. To access the webcast, please visit www.riverrockcasino.com and click on ‘Investor Relations.’ A replay of the call will be available until August 23, 2011 by dialing 877-870-5176; password 4527048.Premium revenue for the three-month period ended June 30, 2011, decreased $2,582,000 compared to the same period last year. The decline was primarily driven by declines in net earned premium in the P&C segment due to catastrophe reinstatement premium, a moderate decline in homeowners business and a decrease in auto policies in-force. Catastrophe reinstatement premium ceded related to Cat 46 totaled $1,490,000.Second Quarter Operating Results for the Period Ended June 30, 2011Shareholders’ equity as of June 30, 2011 was $39,250,000 compared to $43,710,000 down $4,460,000 compared to December 31, 2010. Book value per share declined $1.81 per share for the period ended June 30, 2010 to $15.91 per share compared to $17.72 per share at December 31, 2010. Factors contributing to the change in equity were a year-to-date net loss of $3,950,000, recoveries in market values of fixed maturities and equity securities of $285,000, a net loss on interest rate swaps of $55,000 and dividends paid of $740,000.Conference CallShareholders’ equity as of June 30, 2011 was $39,250,000 compared to $43,710,000 down $4,460,000 compared to December 31, 2010. Book value per share declined $1.81 per share for the period ended June 30, 2010 to $15.91 per share compared to $17.72 per share at December 31, 2010. Factors contributing to the change in equity were a year-to-date net loss of $3,950,000, recoveries in market values of fixed maturities and equity securities of $285,000, a net loss on interest rate swaps of $55,000 and dividends paid of $740,000.Whether actual results will conform to our expectations and predictions is subject to a number of risks and uncertainties, including:Net cash provided by operating activities at June 30, 2011 totaled $26.7 million. Net cash used in capital and related financing activities at June 30, 2011 totaled $19.3 million. Cash used in non-capital financing activities as of June 30, 2011 totaled $6.9 million, which represented net distributions to the Tribe. Cash and cash equivalents net of restricted cash at June 30, 2011 totaled $37.2 million.The net loss for the six months ended June 30, 2011 totaled $3,950,000, $1.60 per share, compared to net income of $2,708,000, $1.10 per share, for the same period last year. The most significant factor contributing to the decline in second quarter net income was the increased frequency of tornado losses.EBITDA should not be construed as an alternative to operating income, as an indicator of the Authority’s operating performance, as an alternative to cash flows from operating activities, as a measure of liquidity, or as any other measure determined in accordance with generally accepted accounting principles (GAAP). Moreover, our calculations of EBITDA may not be comparable to that reported by other companies. EBITDA is a basis upon which we assess our liquidity and because certain covenants in the Indenture for our $200 million senior notes are tied to similar measures. EBITDA also presents useful information regarding our ability to service and incur indebtedness. EBITDA does not take into account our debt service requirements, and accordingly, is not necessarily indicative of amounts that may be available for debt service.[Table Omitted]
[Table Omitted]In addition to the catastrophic losses incurred during the last week of April, the Company incurred an additional $2,274,000 in losses from various other tornado and windstorm events which were not covered by catastrophe reinsurance. These events reduced net income by an additional $1,500,000 for the quarter and year to date period ended June 30, 2011.The National Security Group, Inc., through its property & casualty and life insurance subsidiaries, offers property, casualty, life, accident and health insurance in thirteen states. The Company writes primarily personal lines property coverage including dwelling fire and windstorm, homeowners, mobile homeowners and personal non-standard automobile lines of insurance. The Company also offers life, accident and health, supplemental hospital and cancer insurance products. The Company was founded in 1947 and is based in Elba, Alabama.The Company ended the quarter ended June 30, 2011 with a net loss of $4,945,000, $2.00 per share, compared to a net income of $814,000, $0.33 per share, for the same period last year. The primary reason for the decline in net income was an increase in incurred losses and incurred adjustment expenses in the P&C segment from several severe weather related events during April of 2011. The month of April, 2011 was one of the most active spring storm seasons in history. According to statistics from the National Weather Service and Storm Prediction Center, there were 753 Tornadoes nationwide during the month of April, four of which were rated EF5. All four of the EF5 tornadoes occurred on April 27, 2011. As a result of the tornado, severe wind and hail activity occurring April 25-27, 2011 (hereafter referred to as CAT 46) in the Company’s coverage area, the P&C segment incurred losses and loss adjustment expenses, before reinsurance of $9,936,000. Net income, net of reinsurance, for the three and six month periods ended June 30, 2011, was reduced by $3,777,000 ($1.53 per share) due to storm related losses from this event.The National Security Group, Inc., through its property & casualty and life insurance subsidiaries, offers property, casualty, life, accident and health insurance in thirteen states. The Company writes primarily personal lines property coverage including dwelling fire and windstorm, homeowners, mobile homeowners and personal non-standard automobile lines of insurance. The Company also offers life, accident and health, supplemental hospital and cancer insurance products. The Company was founded in 1947 and is based in Elba, Alabama.
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