• Revenues for the year were $3.0 billion, up from $2.0 billion in 1998, a 50 percent increase. Fourth quarter 1999 revenues totaled $747.6 million, a 42 percent increase over fourth quarter 1998.
• Same store gaming revenue increase of 14 percent for the year drove same store EBITDA growth of 21 percent.
• Cross-market gaming revenues in 1999 accounted for 14 percent of the company�s gaming revenues and represented a 34 percent increase in cross-market play over 1998.
• EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization) before items not typically included in analyst estimates, for 1999 totaled $718.3 million, up 54 percent from the $467.5 million reported in 1998. Fourth quarter 1999 EBITDA rose 38 percent over 1998, to $152.7 million.
• Diluted earnings per share before gains on sales of equity interests in subsidiaries and other assets; writedowns, reserves and recoveries; project opening costs; venture restructuring costs; Missouri Initiative costs; management contract termination fees and extraordinary losses were $1.52 for the year and $0.30 for the fourth quarter, compared to $1.23 and $0.24 for the comparable 1998 periods.
• Completed refinancing of all long-term debt during the first half of the year, extending maturities at attractive interest rates.
• Including all items, diluted earnings per share for the year were $1.62 and for the quarter were $0.45, versus $1.00 and $0.14 for the prior year periods, respectively.

Mr. Satre continued, �We are now clearly differentiated from our competitors, with a nationally recognized brand that stands for quality, customer service and innovation. Our continued investment and emphasis on marketing, technology and database management, new and exciting customer reward and incentive programs, a commitment to service and a broadened national appeal have elevated Harrah�s to a new level. Our goal has been and continues to be to create an organization completely focused on enhancing our customers� experience and delivering an industry-leading return on investment. We reached these goals last year.� Harrah�s 1999 operating results include the impact of the acquisitions of the Rio Hotel Casino (acquired on January 1, 1999), Showboat, Inc., (acquired June 1, 1998) and the consolidation beginning January 1, 1999, of the East Chicago casino.

In addition to record financial results, 1999�s accomplishments included:

• Agreement in August to acquire Players International, Inc. (expected to close in first quarter 2000)
• October opening of Harrah�s New Orleans, the premier land based casino in New Orleans
• Extension of the contract with the Eastern Band of Cherokee Indians for management of the Harrah�s Cherokee Smoky Mountains Casino and, subject to regulatory approval, contract renewal with the Ak Chin Indian Community for management of Harrah�s Ak Chin casino near Phoenix, Arizona
• Agreements to divest non-strategic interests in the Star City casino in Sydney, NSW, Australia and Showboat Las Vegas
• Significant progress in infrastructure integration of Rio and Showboat

• Named to Forbes Magazine Platinum List of Best Companies, the only casino company to make the list, and by Information Week Magazine as one of the nation�s �Top 500 Most Innovative Companies�
• Awarded more �Best of� awards than any company ever in the prestigious Casino Player Magazine reader poll

Full year revenues in the Western Region, which is comprised of the company�s Nevada casinos, topped $1 billion for the first time ever, aided by the addition of Rio and record revenues at both Harrah�s casinos in Southern Nevada (Las Vegas and Laughlin). Harrah�s Northern Nevada casinos revenues were just shy of record levels set in 1989. Rio also reported record revenues in 1999 compared to the amounts it reported in prior years as a separate company.

Full year EBITDA for the Western Region was 83 percent higher than in 1998. The addition of Rio, which earned record EBITDA in 1999, is the principal reason for the increase. The Harrah�s properties in Nevada posted a 16 percent increase over 1998, highlighted by record EBITDA at Harrah�s Las Vegas. Much of this EBITDA growth at the Harrah�s properties is attributable to the company�s Total Gold customer loyalty program, which led to increases in cross-market play, particularly at our Las Vegas casino.

In the fourth quarter, Western Region results were impacted by a low hold percentage on table games at the Rio of 16 percent. This compares with the Rio�s average table hold percentage for the prior eight quarters of 21 percent. Based on this historical average table hold percentage, the company estimates revenues were impacted by approximately $10 million in fourth quarter 1999.

�Our performance in the Las Vegas market reflects the power of our brand and our appeal to our core customer base. Despite all the new casinos that opened on the Strip, Harrah�s Las Vegas and the Rio both expanded revenues and EBITDA to record levels,� stated Satre.
 

The Eastern Region is comprised of properties in Atlantic City, New Jersey. Harrah�s Atlantic City reported record revenues and EBITDA for both the year and fourth quarter 1999. Continued execution of the company�s customer loyalty program produced strong growth for the Harrah�s property. The Eastern Region�s 1999 results include a full year of operations from the Showboat Atlantic City property, while 1998 results included only seven months.  �We are pleased to report that our Atlantic City properties combined, grew gaming revenues faster than the market in 1999 (5.5% vs. 3.2%). This stronger-than-market growth is the result of concentrating our focus on target players, particularly at Harrah�s,� said Satre.
 

Central Region casinos include riverboat and dockside properties in Illinois, Indiana, Mississippi, Missouri and Louisiana. Revenues in the Central Region also exceeded $1 billion for the first time in 1999, up 45 percent from 1998. EBITDA for the year rose 52 percent over 1998, to $254.6 million. The consolidation of Harrah�s East Chicago beginning January 1, 1999, accounted for most of the Region�s growth. However, even if the effects of that consolidation are excluded, the Region�s 1999 revenues would have been a new record and 15 percent higher than 1998, and EBITDA would also have been a record, up 24 percent over 1998.  

The Company�s Chicagoland casinos (Joliet and East Chicago) reported a 161 percent gain in EBITDA for the year. The Joliet casino alone reported a 54 percent increase in EBITDA for 1999 over 1998. Rule changes in Illinois, particularly the conversion from cruising to dockside operation, as well as the addition of a new hotel in November 1999, made the Joliet casino more customer friendly and helped generate record results for the property in 1999.

In Missouri, North Kansas City�s and St. Louis� EBITDA were at record levels, 26 percent above 1998 on a combined basis. The Mississippi casinos� EBITDA was up 55 percent over the prior year on a combined basis.  Shreveport, Louisiana, reported full year EBITDA 9% below the prior year, but construction is well underway on a hotel and shore side amenities project that is expected to make the property more competitive.
 

Harrah�s revenues from management fees rose 20 percent for 1999 driven primarily by a 25 percent increase in same store gaming revenue growth at Native American casinos managed by Harrah�s.  �We are pleased to have extended in 1999 the management agreements of two Native American casinos. This underscores our commitment to Native American gaming and demonstrates that our management adds significant marketing capabilities and generates value to casino owners,� said Satre.

OTHER ITEMS

Centralized services costs declined in 1999 principally related to reduced spending on national advertising.  Writedowns, reserves and recoveries included a reserve for the impairment of an idle riverboat currently being offered for sale by the company.  Equity in losses of nonconsolidated affiliates increased for the year and fourth quarter over the comparable prior year periods primarily due to inclusion of the company�s share of the losses from the Harrah�s New Orleans casino and National Airlines.  The New Orleans casino opened in late October.  While the initial operating performance of the casino is a loss, the opening did cause the overall New Orleans market to grow, and Harrah�s New Orleans captured market share from its competitors.

Corporate expense for the year increased over 1998, but represented only 1.4 percent of revenues in 1999, down from 1.9 percent in 1998. Relocation costs represent expenses incurred to relocate the corporate headquarters office to Las Vegas, Nevada. Goodwill and trademark amortization and interest expense increased over the prior year as a result of acquisitions. Interest expense also increased as a result of the company�s stock repurchase program. During 1999, Harrah�s repurchased 6.1 million shares at an average price of $24.22, including 5.3 million shares at an average price of $24.93 repurchased in the fourth quarter.  Gains on sales of equity interests includes gains on the sale of stock in two companies that no longer represented strategic assets for Harrah�s. The company completed the sale of its equity interests in the Star City casino in Sydney, Australia, during fourth quarter 1999. The company sold its interest in the management contract for this property subsequent to year-end. Net proceeds from these sales totaled approximately $200 million. Proceeds were used to reduce debt.

Harrah�s Entertainment, Inc. is the most recognized and respected name in the casino entertainment industry operating 19 casinos in the United States under the Harrah�s, Showboat and Rio brand names. Founded more than 60 years ago, Harrah�s is focused on building loyalty and value with its targeted customers through a unique combination of great service, excellent products, unsurpassed distribution, operational excellence and technology leadership.

Statements in this release concerning future events, future performance and business prospects are forward-looking and are subject to certain risks and uncertainties.