Jacobs Entertainment, Inc. Reports Third Quarter and Nine Month Results

GOLDEN, CO -- (Marketwire) -- 11/10/09 -- Jacobs Entertainment, Inc. ("JEI"), an owner and operator of multiple gaming properties, today announced unaudited financial results for its third quarter and nine-month period ended September 30, 2009.

Net revenues for the third quarter of 2009 were $82.4 million compared to $95.8 million for the third quarter of the previous year. Net income attributable to JEI for the third quarter of 2009 was $994 thousand compared to a net loss of $899 thousand for the third quarter of the previous year.

Net revenues for the nine-month period ended September 30, 2009 were $238.2 million compared to $281.6 million for the nine-month period ended September 30, 2008. Net income attributable to JEI for the nine-month period ended September 30, 2009 was $6.6 million compared to a net loss of $1.2 million for the same period of the previous year.

JEI will host a conference call to discuss its operating results for the third quarter and nine-month period ended September 30, 2009. The conference call will be held at 11:00 a.m. Eastern Time on Wednesday, November 11, 2009, and will be hosted by Stephen R. Roark, President of JEI, and Ian M. Stewart, President of Pari-Mutuel Wagering Operations, along with other members of the JEI management team.

To participate in the JEI conference call on Wednesday, November 11, 2009, at 11:00 a.m. Eastern Time, please dial 866-223-7781 and indicate to the operator that you are calling regarding the Jacobs Entertainment conference call. Please call at least 5 minutes before the call is to begin.

If you are unable to join the JEI conference call, you may access a replay of the call starting at 2:00 p.m. Eastern Time on Wednesday, November 11, 2009. To access the replay, please dial 800-408-3053 and reference the confirmation code: 2061402. The replay will continue until Midnight Eastern Time on Wednesday, November 18, 2009.

Based in Golden, CO, Jacobs Entertainment is the owner and operator of The Lodge Casino at Black Hawk and the Gilpin Casino, both located in Black Hawk, Colorado; the Gold Dust West-Reno Casino in Reno, Nevada; the Gold Dust West-Carson City Casino in Carson City, Nevada; the Gold Dust West-Elko Casino in Elko, Nevada (the casino properties); Colonial Downs Racetrack in Virginia and eight related off-track wagering facilities located in Virginia; and 18 truck plaza video gaming facilities located in Louisiana with a share in the gaming revenues of an additional truck plaza located in Louisiana.

Our business and financial performance are subject to a number of risks and uncertainties that might adversely affect our operating results in the future in a material way, such as the intensity of competition, our ability to meet debt obligations, regulatory compliance, taxation levels, effects of national and regional economic and market conditions, labor and marketing costs, success of our diversification plan and the successful integration of our operations.

JACOBS ENTERTAINMENT, INC. FINANCIAL HIGHLIGHTS (unaudited) (dollars in thousands)

SELECTED INCOME STATEMENT DATA

Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 --------- --------- --------- --------- Revenues: Total revenues $ 91,862 $ 104,240 $ 264,532 $ 307,301 Promotional allowances (9,453) (8,449) (26,334) (25,740) --------- --------- --------- --------- Net revenues 82,409 95,791 238,198 281,561

Costs and expenses (75,109) (89,858) (212,734) (262,253) --------- --------- --------- ---------

Operating income 7,300 5,933 25,464 19,308

Interest expense, net (6,306) (6,825) (18,908) (20,539) Noncontrolling interest (7) (11) --------- --------- --------- --------- Net income (loss) attributable to JEI $ 994 $ (899) $ 6,556 $ (1,242) ========= ========= ========= =========

SELECTED BALANCE SHEET DATA

September 30, December 31, 2009 2008 ------------- ------------

Total assets $ 346,961 $ 344,477 Total liabilities $ 317,377 $ 318,941 Stockholder's equity $ 29,584 $ 25,536

EBITDA represents earnings before interest, income taxes, depreciation and amortization and is a non-GAAP financial measure that management believes is useful because it allows holders of our debt and management to evaluate and compare the Company's operating results from continuing operations from period to period in a meaningful and consistent manner in addition to standard GAAP financial measures. Adjusted EBITDA represents EBITDA plus expenses that we do not consider representative of our ongoing operations and that could result in comparison distortions. Management internally evaluates the performance of its segments using EBITDA and Adjusted EBITDA measures as do most analysts following the gaming industry. EBITDA is also a key component of certain financial covenants in the Company's debt agreements. This information should not be considered as an alternative to any measure of performance as promulgated under accounting principles generally accepted in the United States of America, such as net income (loss), nor should it be considered as an indicator of our overall financial performance. Our calculation of EBITDA and Adjusted EBITDA may be different from the calculation used by other companies and comparability may be limited.

EBITDA AND ADJUSTED EBITDA RECONCILIATION (dollars in thousands)

Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 -------- -------- -------- -------- Net income (loss) attributable to JEI as reported above $ 994 $ (899) $ 6,556 $ (1,242) Add:

Interest expense, net 6,306 6,825 18,908 20,539 Depreciation and amortization 5,389 5,016 15,919 14,939 Noncontrolling interest -- 7 -- 11 -------- -------- -------- -------- EBITDA $ 12,689 $ 10,949 $ 41,383 $ 34,247 Unrealized (gain) loss on change in fair value of investment in equity securities (456) -- (1,123) 4,063 Goodwill impairment -- 199 -- 199 Colorado Constitutional amendment costs -- 874 -- 1,080 Ohio Constitutional amendment costs 408 -- 408 -- -------- -------- -------- -------- ADJUSTED EBITDA $ 12,641 $ 12,022 $ 40,668 $ 39,589 ======== ======== ======== ========