Nevada Gold still hot for Silver State

The interim president of a Houston-based gaming company on Wednesday reaffirmed his company's commitment to expanding its Nevada operations.

Ernest East called Nevada "a very important jurisdiction," but added there is nothing to announce in terms of potential acquisitions or management contracts.

Beyond its minor stake in a Reno casino, expansion for Nevada Gold & Casinos Inc., has stalled as the gaming company searches for a new chief executive officers and expands its profitable slot route operations in South Dakota.

Nevada Gold obtained its gaming license in Nevada in January when regulators approved its acquisition of a 1 percent stake in The Nugget in Reno.

At the time of its licensing hearing, Nevada Gold was in negotiations for a small equity position and a management contract on a proposed hotel and casino adjacent to the Las Vegas Motor Speedway. The $60 million project would include a 200-room hotel and a 30,000-square-foot casino on a parcel next to the Petro Truck Stop, adjacent to the speedway.

The property's original owner lost control of the site to Lennar Corp. and several banks, according to the gaming company.

The company's subsidiary Nevada Gold Speedway LLC was also licensed earlier this year. Nevada Gold operates a satellite office in Las Vegas.

In an earnings conference call with analysts Wednesday, East said the company's board will "review all of our projects."
He said the company still holds its stake in The Nugget in Reno, but the investment really doesn't add much to the company's earnings.

East, who has more than 25 years of experience in the gaming industry with companies such as Trump Hotels and Casino Resorts, said the investment in Reno was "a vehicle to permit us to apply for a license."

Nevada Gold on Wednesday reported net income of $168,125, or 1 cent a share, for the fiscal first quarter, compared with a loss of $191,859, or negative 1 cent a share, in the same period last year.

Net revenues were $16.8 million, up from $12.7 million in the first quarter of 2011.

East was named interim president on Friday following the resignation of CEO Robert Sturges. He was formerly senior vice president and general counsel with Nevada Gold.

East told analysts he was optimistic the company will move quickly to find a new CEO.

Nevada Gold also announced it has added to its existing slot machine route operations in South Dakota by entering into an agreement to operate the slots at The Midnight Star, a casino and restaurant in Deadwood.

Nevada Gold will own and operate the 50 slot machines under a five-year revenue sharing agreement with the casino. The company operates 950 slot machines in South Dakota.

East said the company's South Dakota operations generated $2.9 million in first quarter revenues, while its gaming division in the state of Washington generated $13.8 million. Nevada Gold owns and operates 10 casinos in Washington.

Nevada Gold in May completed the $3.125 million sale of the Colorado Grand Casino in Cripple Creek, Colo. East said $800,000 from the sale went to pay down the company's debt, which was approximately $14 million at the end of the first quarter.

Contact reporter Chris Sieroty at csieroty@reviewjournal. com or 702-477-3893. Follow @sierotyfeatures on Twitter.