155 East Tropicana, LLC Announces Fourth Quarter and Full Year 2007 Financial Results

LAS VEGAS--(Business Wire)--
155 East Tropicana, LLC (the "Company") today announced full year
and fourth quarter operating results for the period ended December 31,
2007. The Company owns the Hooters Casino Hotel in Las Vegas, Nevada,
which celebrated its grand opening on February 2, 2006.

Operating highlights of 155 East Tropicana, LLC for the full year
and fourth quarter ended December 31, 2007, compared to the results of
operations for 155 East Tropicana, LLC for the same periods in 2006,
are as follows:

-- Net loss for 2007 improved by $4.3 million from a loss of
$18.4 million in 2006 to $14.1 million in 2007.

-- Net revenues for the full year 2007 declined 3.0% to $65.0
million, compared to $66.7 million in 2006. Adjusted EBITDA(1)
was $6.7 million for 2007, compared to $7.6 million for 2006.
A substantial portion of the annual decline in revenues and
Adjusted EBITDA(1) occurred in the fourth quarter of 2007.

-- Net revenues for the fourth quarter of 2007 declined 12.0% to
$14.8 million, compared to $16.8 million in the fourth quarter
of 2006. Adjusted EBITDA(1) was $1.8 million in the fourth
quarter 2007, compared to $2.4 million in the same quarter of
2006.

"During the fourth quarter of 2007, we added key marketing
programs to promote revenue," stated Mr. Gary Gregg, Chief Operating
Officer. "We also overhauled our operational expense structure,
reorganized our management team, restaurant operations, staffing
levels, benefit programs and other expenses. We feel confident that
these improvements will better position us to reach our goals in
2008."

-0-
*T
Supplemental Schedule

Statement of Operations for 155 East Tropicana, LLC
----------------------------------------------------------------------

------------- -------------
Quarter ended Quarter ended
December 31, December 31,
2007 2006
----------------------------

Operating revenues:
Casino $ 5,593,457 $ 6,219,607
Food, beverage and entertainment 5,023,083 5,714,485
Hotel and other 5,592,937 6,104,431
------------- -------------
16,209,477 18,038,523
Less promotional allowances (1,361,718) (1,263,904)
------------- -------------
Net operating revenues 14,847,759 16,774,619

Operating expenses:
Casino 3,129,106 3,384,038
Food, beverage and entertainment 3,735,343 4,553,009
Hotel and other 2,548,944 2,262,591
General and administrative 3,672,625 4,196,250
Depreciation 1,569,826 1,179,831
Related party royalties expense 331,344 375,043
Pre-opening expenses - -
Restructuring costs - -
------------- -------------
Total operating expenses 14,987,188 15,950,762
------------- -------------
Operating income (loss) (139,429) 823,857
Other income (expense):
Interest expense, net of capitalized
interest (3,360,220) (3,255,520)
Interest income 12,864 58,508
------------- -------------
Other income (expense), net (3,347,356) (3,197,012)
------------- -------------
Net loss $(3,486,785) $(2,373,155)
============= =============
*T

Operating Results of 155 East Tropicana, LLC for the Quarter Ended
December 31, 2007 Compared to the Quarter Ended December 31, 2006

The fourth quarter of 2007 was a quarter of significant
operational changes.

-- New marketing strategies for slot promotions were developed.

-- We brought in new expertise to help us improve occupancy,
improve ADR and increase advance bookings.

-- Research was conducted on an idea to revolutionize customer
service in table games operations and increase the job
satisfaction of our dealers. We eliminated the normal
tip-sharing policy prevalent in casinos on the Strip. Our
dealers do not pool their tips but keep all of the tips they
earn each day, which has encouraged the dealers to provide a
fun and friendly place to play at Hooters. The go-for-your-own
tip policy began in January 2008.

-- All expenses were reviewed, resulting in the consolidation of
the Dam 24-hour coffee shop into the Marino's restaurant. The
consolidation of the front of house serving staff and closure
of the Dam kitchen resulted in an average monthly savings of
$0.3 million.

-- The management team was reorganized resulting in staff
reductions. Hourly staff efficiencies were also reviewed
resulting in payroll expense reductions.

-- Our benefits programs were reviewed and we found ways to offer
the same benefits to employees at a reduced cost.

Mr. Gregg continued, "All of these changes are expected to benefit
future quarters. Initial results in the first quarter of 2008 have
been encouraging."

Net operating revenues for the fourth quarter ended December 31,
2007, were $14.8 million, compared to net revenues of $16.8 million in
the fourth quarter of 2006, a decrease of 12%. The decrease in net
revenues was due to declines in all revenue areas as discussed below.

According to Gaming Revenue Reports published by the Nevada Gaming
Control Board, the gaming revenue for all locations on the Las Vegas
Strip fell 0.7% for the quarter ended December 31, 2007 and table
games revenue fell 3.4% in the fourth quarter. We believe that this is
indicative of an overall softening of the Las Vegas Strip casino
revenues in the fourth quarter that has affected smaller properties,
such as Hooters Casino Hotel, the most.

Visitor counts to Las Vegas in the fourth quarter of 2007,
published by the Las Vegas Visitors Authority were flat with the same
quarter in 2006. We believe that the credit market crisis that began
in August 2007 has impacted our revenues and visitor counts.

Casino revenues were $5.6 million for the fourth quarter ended
December 31, 2007, compared to $6.2 million for the same quarter in
2006 due to decreases in both table games drop and slot coin-in.

Food, beverage and entertainment revenue decreased 12% to $5.0
million for the quarter ended December 31, 2007 as compared to $5.7
million for the fourth quarter of 2006, due to the closing of the "13"
Martini Bar and a decline in other bar and restaurant revenues. The
Dam 24-hour coffee shop was closed on October 24, 2007 and Marino's
began operations at that time as a 24-hour restaurant, but that event
did not contribute to the decrease in food revenue for the quarter.
Most of the displaced covers from the closing of the Dam were absorbed
into Hooters and Marino's restaurants. We were experiencing a 13.7%
decline in restaurant revenues prior to the closing of the Dam which
we believe was due to a general decline in traffic and occupancy.

The profit margin for food and beverage operations increased to
25.6% for the quarter ended December 31, 2007, versus 20.3% for the
quarter ended December 31, 2006. The savings resulted from the
consolidation of the front-of-the-house serving staff and closure of
the Dam kitchen operations.

Hotel and other revenue (which includes hotel room revenue,
retail, spa, and other miscellaneous revenue) decreased 8.4%, to $5.6
million for the quarter ended December 31, 2007 from $6.1 million for
the quarter ended December 31, 2006. Room revenue was $3.8 million for
the fourth quarter of 2007 compared to $4.5 million for the fourth
quarter of 2006. Average daily room rates decreased by 13.0% to $73
for the fourth quarter of 2007 from $84 for the quarter of 2006.
Occupancy rates increased to 84.6% for the fourth quarter of 2007 from
83.4% for the fourth quarter of 2006.

General and administrative expenses decreased to $3.7 million in
the fourth quarter of 2007 from $4.2 million in the fourth quarter of
2006, principally due to decreases in marketing expenses.

Adjusted EBITDA (1) was $1.8 million in the fourth quarter of
2007. This compares to $2.4 million for the same period in 2006.

Operating Results of 155 East Tropicana, LLC for the Year Ended
December 31, 2007 Compared to the Year Ended December 31, 2006

Net operating revenues for 2007 were $65.0 million compared to
$66.7 million in 2006, a decrease of $1.7 million. For 2007 we
operated for a full twelve months. In 2006 we were essentially closed
in January and reopened as the Hooters Casino Hotel on Feb. 3, 2006,
when revenues spiked for about three months with the excitement of the
grand opening. We experienced a decline in casino revenues of $2.3
million in 2007 due to decreased traffic and an increase in
promotional allowances of $0.9 million due to new slot programs. These
were offset partially by increased hotel and other revenue of $1.8
million due to increased occupancy in January and throughout the year.

We believe that our slot revenue win per unit can be increased to
a more competitive level in future periods by focusing on special slot
promotions, direct marketing programs and other programs targeted to
increase casino traffic. Those programs were instituted in late 2007
and early 2008.

Despite an extra month of operations in 2007, operational expenses
before depreciation, related party royalty expense, preopening and
loss on disposal of assets were $58.4 million in 2007 compared to
$59.1 million in 2006 due to cost cutting in payroll, marketing and
other areas.

Adjusted EBITDA was $6.7 million in 2007 compared to $7.6 million
in 2006.

For the year ended December 31, 2007, the Company used $6.3
million of cash in operating activities, which included the payment of
$11.9 million in interest on all debt. For the year ended December 31,
2007, $0.9 million of cash was used in investing activities, as a
result of capital expenditures.

For the year ended December 31, 2007, the Company was provided
$6.8 million of cash from financing activities. The Company received
$5.3 million in proceeds from issuance of long-term debt and $3.5
million in payments related to the asset purchase agreement entered
into by the Company in April 2007. This was partially offset by $2.0
million in principal payments on equipment debt.

Subsequent to December 31, 2007, the Company collected payments of
$500,000 in January, February and March 2008 to extend the deadline
for the closing of the asset purchase agreement. The closing deadline
can be extended to June 30, 2008 with additional extension fee
payments of $500,000 in April and May, 2008.

We believe that we have the flexibility to cover operational
contingencies, working capital needs, capital expenditures, and debt
service obligations during 2008 through the use of cash (which totaled
$5.9 million at December 31, 2007, including $3.8 million required in
daily operations), our cash flow from operations, our ability to draw
against our $15.0 million credit facility, other available equipment
financing and the receipt of extension fee payments called for under
the asset purchase agreement received subsequent to December 31, 2007.

Capital expenditures of approximately $1.0 million are anticipated
in 2008.

Conference Call

The Company will conduct a conference call to discuss its fourth
quarter and full year 2007 financial results on Wednesday, April 2,
2008 at 9:30 a.m. ET. The call can be accessed live over the phone by
dialing (888) 256-9124 or for international callers by dialing (913)
312-1277. The conference call will be simultaneously webcast on the
Investor Relations portion of the Company's website,
www.hooterscasinohotel.com. A replay will be available one hour after
the call and can be accessed by dialing (888) 203-1112 or for
international callers by dialing (719) 457-0820; the password is
1304172. The replay will be available from April 2, 2008 through April
9, 2008.

-0-
*T
(1) "Adjusted EBITDA" is defined as earnings before interest, taxes,
depreciation and amortization, but after adding back unusual or
non-cash items such as pre-opening expenses, loss on disposal of
assets and related party royalties. Adjusted EBITDA should not be
construed as an alternative to operating income, as an indicator
of the Company's operating performance, or 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. Moreover, our calculations of
Adjusted 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 our notes indenture and our
credit facility 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.
*T

The following table reconciles Adjusted EBITDA to operating income
(loss) for the periods indicated (in thousands):

-0-
*T
Three Months Three Months Year Year
Ended Ended Ended Ended
December 31, December 31, December December
2007 2006 31, 2007 31, 2006
---------------------------------------------
Operating income (loss) $ (139) $ 824 $ (962) $(6,194)
Depreciation 1,570 1,180 6,250 5,842
Related party royalties 331 375 1,387 1,459
Pre-opening expense - - - 5,293
Loss on disposal of
assets - - - 1,199
------------ ------------ --------- ---------
Adjusted EBITDA $1,762 $2,379 $6,675 $ 7,599
============ ============ ========= =========
*T

About 155 East Tropicana, LLC

155 East Tropicana, LLC owns the Hooters Casino Hotel in Las
Vegas, Nevada. The property is located one-half block from the
intersection of Tropicana Avenue and Las Vegas Boulevard, a major
intersection on the Las Vegas Strip. The Hooters Casino Hotel features
696 hotel rooms and an approximately 29,000 square-foot casino.
Additional information about the Company can be found at
www.hooterscasinohotel.com.

Forward-Looking Statements

This release contains certain "forward-looking statements" within
the meaning of the Unites States Private Securities Litigation Reform
Act of 1995. Actual results in future periods may differ materially
from forward-looking statements made today because of a number of
risks and uncertainties, including, but not limited to, risks relating
to our substantial level of debt and our debt obligations and
covenants; the implementation of the Company's business and marketing
strategies; the Company's short operating history; its dependence on
one gaming site; changes in and challenges to gaming laws and
regulations; competition; changes in federal or state tax laws; and
other factors beyond our control. Additional information about factors
that could affect the Company's business is set forth in SEC filings.

-0-
*T
155 East Tropicana, LLC
(A Nevada Limited-Liability Company)
CONSOLIDATED BALANCE SHEETS

December 31, December 31,
2007 2006
------------- -------------
Assets
Current assets:
Cash and cash equivalents $ 5,861,991 $ 6,164,192
Accounts receivable, net of allowance for
doubtful accounts of $90,831 and $99,921
in 2007 and 2006, respectively 1,880,454 1,609,756
Inventories 931,029 846,651
Prepaid expenses 1,576,356 1,569,980
------------- -------------
Total current assets 10,249,830 10,190,579
Property and equipment, net 117,084,512 122,135,784
Other long-term assets:
Deferred financing costs 4,971,161 6,366,625
Intangible assets 6,505,209 6,557,119
Other assets 336,022 343,273
------------- -------------
Total other long-term assets 11,812,392 13,267,017
------------- -------------
Total assets $139,146,734 $145,593,380
============= =============

Liabilities and Members' Equity
Current liabilities:
Accounts payable $ 2,974,233 $ 2,969,064
Accrued interest payable 2,843,750 2,843,750
Accrued liabilities 1,399,930 2,266,740
Purchase deposit and extension payments 3,500,000 -
Current portion of long-term debt 2,035,273 1,859,319
------------- -------------
Total current liabilities 12,753,186 9,938,873
Related party royalties payable 2,848,796 1,461,881
Long-term debt 136,552,084 133,081,099
------------- -------------
Total liabilities 152,154,066 144,481,853
------------- -------------

Commitments and contingencies

Members' equity:
Membership interests 34,333,375 34,333,375
Accumulated deficit (47,340,707) (33,221,848)
------------- -------------
(13,007,332) 1,111,527
------------- -------------
Total liabilities and members'
equity $139,146,734 $145,593,380
============= =============
*T

-0-
*T
155 East Tropicana, LLC
(A Nevada Limited-Liability Company)
CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended Year Ended
December 31, December 31,
2007 2006
------------- -------------

Operating revenues:
Casino $ 23,551,180 $ 25,830,265
Food, beverage and entertainment 23,318,248 23,620,776
Hotel and other 24,483,805 22,696,316
Related party lease income - -
------------- -------------
71,353,233 72,147,357
Less promotional allowances (6,315,609) (5,436,431)
------------- -------------
Net operating revenues 65,037,624 66,710,926

Operating expenses:
Casino 13,440,537 13,103,972
Food, beverage and entertainment 17,721,954 18,973,914
Hotel and other 9,222,140 8,785,883
General and administrative 17,977,767 18,248,203
Depreciation and amortization 6,249,991 5,841,526
Pre-opening expenses - 5,292,834
Related party royalties expense 1,386,914 1,459,162
Loss on disposal of assets - 1,199,470
------------- -------------
Total operating expenses 65,999,303 72,904,964
------------- -------------
Operating loss (961,679) (6,194,038)

Other income (expense):
Interest expense, net of capitalized
interest of $0, $202,873 and $692,059
for the years ended December 31, 2007,
2006 and 2005, respectively (13,248,133) (12,745,839)
Interest income 90,953 498,607
Loss on extinguishment of debt - -
------------- -------------
Other income (expense), net (13,157,180) (12,247,232)
------------- -------------
Net loss $(14,118,859) $(18,441,270)
============= =============
*T

155 East Tropicana, LLC
Michael Hessling, 702-597-6076
President

Copyright Business Wire 2008