FOOL CONFERENCE CALL SYNOPSIS*
By Debora Tidwell (TMF Debit)

Circus Circus Enterprises, Inc.
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P.O. Box 14967
Las Vegas, NV 89114-4967
(702) 734-0410
http://www.circuscircus.org/

UNION CITY, CA (June 3, 1997)/FOOLWIRE/ --- Circus Circus Enterprises announced its results for the first quarter 1997 on May 29th. The company reported net income of $37.489 million or $0.40 per share, compared with $43.472 million or $0.42 per share in the same quarter last year. The $0.42 per share a year ago was after write-offs reflecting the removal of the Nile River, formerly in the Luxor. Operating cash flow for the quarter was $114 million. That compares equally to last year which was just a little over $115 million. Last year they were still operating the Hacienda and had a one-third share of the management contract in Windsor. So, if you just look at continuing operations they compared $114 million versus $108 million last year.

LUXOR PROPERTY. Luxor was their top earnings producer for the first quarter. The property generated $27.5 million in operating cash flow against $22.1 million a year ago, an increase of about 25%. They were not in construction in the first quarter last year to any degree. It was a strong quarter at the property as it was all along the Las Vegas Strip. The growth on The Strip, almost to a company and to a property last year, occurred in the first five or six months of the year. The Luxor is practically a single-dimensional property as it remains under construction, as to its supporting cast of amenities which is retail and restaurants which will come this Summer and the showroom which will be early Fall. That single dimension is a factor of room rate and room occupancies. They have pretty sizeable profit leverage. A point of occupancy rate or a point of room rate at the 4500-room Luxor is almost $1.5 million each in operating cash flow over the course of the year. In the first quarter they ran 91% occupancy at Luxor and an $84 average rate. Some months were stronger than others. April, for example, was a 91% occupancy rate and a $92 average rate. In April they exceeded $10 million in operating cash flow. So, when the Luxor fills and can move its price up, it generates substantial cash flows. For the quarter they noted, which did have an underpowered casino, the operating cash flow margin at Luxor was 38%.

EXCALIBUR PROPERTY. Excalibur had tough comparisons in the quarter. The all-time record cash flows at that property occured in the first quarter a year ago. This quarter they also faced the opening of New York, New York and it is fair to suspect that some of their headcount was crossing the bridge to check the new property out. Occupancy rate remained 99% and the room rate was $65, up $1. But, slots felt the pressure and total casino revenues were down almost 10% compared to a year ago in the first quarter. Operating cash flow was $25.4 million against $29.3 million a year ago. EBITDA margin in the quarter was 35%. They expect easier comparisons as the year goes on and May has presented a hint of this.

CIRCUS CIRCUS LAS VEGAS PROPERTY. Circus Circus Las Vegas, for its part, ran 100% occupancy in the quarter, including the 1000 new rooms at a rate pretty comparable to last year, $51 against $53. The Circus Circus property itself, apart from Slots-of-Fun or Silver City, climbed mildly in cash flow to $15.4 million against $15 million a year ago. They were not yet in construction there a year ago. The casino, to-date, is not reflecting the additional occupied room nights at the property and the property as a whole is underperforming as a consequence. EBITDA margin in the quarter at Circus Circus was 27%.

MONTE CARLO PROPERTY. Monte Carlo has kept to its fast course. The property as a whole, Circus Circus Enterprises owns half, generated $24 million in EBITDA in the quarter. Their room rate was $80 and occupancy was 98%. Operating cash flow margin at Monte Carlo was 39%.

CASINO PERFORMANCE DISAPPOINTING. If you blend the margins of their four major resorts on the Las Vegas Strip, they are around the top of the gain in the middle-30s and revenues are not where they would like to see them yet. In terms of the casinos, at the Luxor they clearly are hobbled by the fact that their swing shift doesn't have any draws. They don't have enough restaurant seats in fine dining restaurants nor do they have a showroom so they tend to be an exporter of people in the evening because they either go to shows and then tend to stay and play and Luxor doesn't have those full features in yet. So, they expect to do better as those elements come aboard at Luxor on the casino side. At Circus Circus they know that people are leaving Circus Circus to go have a look. They assume that's New York, New York. It is also the case, this happened in the past when they expanded Circus, that they may have moved people that were otherwise playing at Circus Circus but sleeping at the Travelodge or Riviera or somewhere in the vicinity into Circus Circus rooms. But, that much said, Circus Circus with respect to the casino performance is a disappointment to them. They are working on it.

OUTLOOK FOR Q2 AT LUXOR. In the second quarter, volatility will continue at Luxor. They are in something of an occupancy and rate battle. There are 11,000 new rooms on The Strip that weren't there a year ago and visitor counts in terms of percentage increase have not matched the growth in new rooms. Their expectation is close but somewhat lower occupancy rates along The Strip compared to a year ago, and the same for room rates. With respect to Luxor, their FIT (Frequent Individual Traveller) business is uneven. It is a relatively short window business, sometimes as short as two weeks. That person calling an 800 number or booking through a travel agent drives the final occupancy rate and room price. When that phone bank is running strong, the prices run up. There is really no change from the last call 3 months ago. Expectations are still something around the upper-80s for occupancy rate and low-to-mid-$80s in room rate. 90/$90 months will be the exception for the Summer. They are not out of the woods in a challenging environment where they are repositioning a property. It is not finished with its construction yet. They are not getting the first call. For the Summer months, forward bookings relative to last Summer are a little softer.

NEW SITES IN LAS VEGAS. They are out of the ground on Project Paradise which means you can see the room towers coming up. They could open as early as Christmas 1998 or into the first quarter of 1999. The estimated budget is about $850 million now. The Four Seasons will come in the next phase if their negotiations continue on the track they are currently on. They should have an announcement for Project Z, which is the next 4000 room property, which at this point appears to be a joint venture, in maybe 6-8 months in timing maybe as far as a year behind Project Paradise and that would be the timing for the Four Seasons as well. They are still value engineering the budget figure for the Four Seasons but they expect it to be in the $60-70 million range.

LONGER-TERM OUTLOOK FOR LUXOR. They think Luxor will generate more profits as they in-fill the masterplan mile in Las Vegas. The more units they get down on that mile as fast as they can build them, the better Luxor will do because it will be the building that has the most traffic flow coming from the most directions. Part of that is that they have 15 acres across the street where they expect in some form to have 2000 rooms that connect. Their sense is that it ever-becomes a greater crossroads and has more foot traffic from what eventually be 22,000 rooms in that mile. Luxor is not last, it is in the middle of a pretty vibrant mile or at least a second epicenter on the Las Vegas Strip. In their own planning they have the assumptions of rising room rates, in part driven by the opening of Bel Agio and the superstores of 1998 going in and 1999 which they think will set new price parameters in the market and that today at Luxor they have a highly attractive product that will be capable of getting $100 plus room rates. As walk-in traffic builds simultaneously with that, they think the earning power of that asset will bear out the investment they have put in it.

RENO AND LAUGHLIN. In Reno, the first quarter compared very well with last year. They were up almost 30% in cash flow. Both properties participated. The women bowlers arrived in March. Silver Legacy (which they own 50% of), of the two, was the stronger property. They consider Reno a no-growth market, it's a marketshare gain there. The downslide in Laughlin was still more in the first quarter as expected. They had a very strong first quarter in Lqughlin last year. But Reno and Laughlin basically washed each other in the quarter. They did $11.6 million in operating cash flow in Reno versus $9 million a year ago and $10.9 million in Laughlin in the quarter versus $13.6 million a year ago.

RIVERBOATS. On the riverboat front, in Elgin the Grand Victoria has not been fazed by openings of Indiana vessels to-date whether Gary, Hammond, or East Chicago. Mid-year last year they began profit sharing with King County and the city of Elgin. It is about 20% of their cash flow on a going-forward basis. That profit-sharing increment explains the downticks in Elgin. Last year they produced $15.8 million in the first quarter. The number for this year's first quarter was $12.8 million. Grand Victoria has now received approval for an increased passenger count which helps on peak cruises which are basically weekends. They can go to just over 2000 passengers per boarding now. There is a proposed bill in Illinois that would lift or propose to raise taxes on a graduated basis, meaning more profitable and bigger Chicago-area boats would have higher tax rates than the smaller boats elsewhere on the Mississippi. They don't know whether it will be a viable bill or not. It is also contemplated that as part of that bill they would have dockside gaming -- basically Iowa rules -- which is to say they would have a certain number of cruises they have to take. But that is generally done in the early morning on the light occupancy. And then they would have open dockside gaming which would be a positive to casino revenues. Without knowing what the schedule may turn out to be for a raise in the tax rate, they can't tell if the potential increase in the casino revenue would offset the higher rates.

TUNICA AND GULF COAST PROPERTIES. In Tunica, they are under construction in the casino which they are converting to a more Monte Carlo style experience to be rechristened Gold Strike. They have completed one quadrant of that construction. They will finish the casino by September. The 1200 rooms are on schedule for a December opening. They produced $2.4 million in operating cash flow in the quarter versus $4.9 million a year ago. EBITDA in the quarter was $5.5 million versus $6.5 million last year. Further South on the Gulf Coast they prevailed in the rehearing of their environmental permit which is another move forward for their Pine Hills project on Interstate 10. They should shortly, they believe, be in receipt of an Army Corp permit. Then they will have to further analyze harassment lawsuits coming from their competitors and their front groups.

OTHER PROPERTIES. Last year's quarter contained the Hacienda which generated $4.5 million in cash flow and their portion of the management contract in Windsor which produced $2.5 million in cash flow.

DETROIT PROGRESS. As to Detroit, they have signed an agreement with Atwater Casino Group, one of the two preferred applicants for casino license in Detroit as ratified by the state referendum last November. There will be 3 Detroit licenses, according to that referendum which is called Proposal E. Atwater is composed of outstanding local professionals, educators, and business people who campaigned for and financed Proposal E. Among its membership is Marian Illitch of Little Caesar's fame who has been the backbone of downtown Detroit's entertainment for the past 15 years. She is the inspiration and the checkbook behind the rennovated Fox Theater and she owns the Red Wings professional hockey team. Her husband Mike owns the Detroit Tigers. She is a highly regarded visionary for downtown Detroit and the combined bid of Atwater and Circus is nothing less than a front-runner. Atwater chose Circus as a gaming partner from a field of candidates that included all eligible major competitors. Circus will own 45% of the Detroit project and will receive a management fee. They will arrange financing off-balance-sheet. Any equity they provide for their partners will be repaid with a return. They foresee a market potential in terms of casino revenues in Detroit in excess of $1 billion. The two preferred applicants are to be awarded licenses ahead of the floating or third license. They noted that the road to licensure is not straight-away. They have to first arrange a development agreement with the city of Detroit then proceed to Lansing for a state license. The timetable on these matters is not clear. As to a first step, the Mayor of Detroit sometime around the second week of June is expected to announce the boundary lines of a casino zone in downtown Detroit. They would build hotel rooms as part of an urban entertainment center and resort at the Detroit site. The only way they can envision a site opening in Detroit before 1999 is if it were housed in a temporary existing facility.

ATLANTIC CITY. They continue to have an interest in Atlantic City. The Mirage needs to give Circus a defined plot plan before they are able to apply for permits there.

NEW BANK FACILITY. Circus has closed its new bank facility of $2 billion at the lowest cost and most flexible terms of any banking agreement in their corporate history. As part of this agreement, they have immediate access to $500 million for share repurchase. They have been known of late to have a fast trigger finger with share repurchase, but in any event they have now reloaded.

CASH, DEBT, EQUITY. On the balance sheet, cash for the first quarter was $65.4 million. Long-term debt was $1.423 billion. Book equity was $1.013 billion.

* A Fool conference call synopsis represents an effort to highlight the salient points of a conference call and should not be taken as an authoritative accounting or transcription of the entire event. Note: Statements made by a company other than historical information may constitute forward-looking statements for which the company can claim protection under the Safe Harbor Act. Please consult the company's filings with the SEC for information on risk factors which might cause actual results to differ materially from the information contained in these forward-looking statements.