10-Q 1 form10q.htm 10Q - Q2 2012
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2012
OR
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ___________
Commission file number 0-22900
CENTURY CASINOS, INC.
(Exact name of registrant as specified in its charter)

DELAWARE | 84-1271317
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)

2860 South Circle Drive, Suite 350, Colorado Springs, Colorado 80906
(Address of principal executive offices, including zip code)
(719) 527-8300
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨ |  | Accelerated filer ¨ |  | Non-accelerated filer ¨ |  | Smaller reporting company þ
|  |  |  | (Do not check if a smaller reporting company) |  |

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practical date:
24,233,174 shares of common stock, $0.01 par value per share, were outstanding as of July 27, 2012.
1

CENTURY CASINOS, INC.
FORM 10-Q INDEX

|  |  | Page
PART I |  | FINANCIAL INFORMATION | Number
Item 1. |  | Condensed Consolidated Financial Statements (unaudited) |
|  | Condensed Consolidated Balance Sheets as of June 30, 2012 and December 31, 2011 | 3
|  | Condensed Consolidated Statements of Earnings for the Three and Six Months ended June 30, 2012 and 2011 | 4
|  | Condensed Consolidated Statements of Comprehensive (Loss) Earnings for the Three and Six Months ended June 30, 2012 and 2011 | 5
|  | Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2012 and 2011 | 6
|  | Notes to Condensed Consolidated Financial Statements | 8
Item 2. |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 17
Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk | 34
Item 4. |  | Controls and Procedures | 34
PART II |  | OTHER INFORMATION |
Item 1A. |  | Risk Factors | 35
Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds | 35
Item 6. |  | Exhibits | 36
|  | SIGNATURES | 36

2

PART I – FINANCIAL INFORMATION
Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

|  | June 30, |  |  | December 31, |
Amounts in thousands, except for share and per share information |  | 2012 |  |  | 2011 |
ASSETS |  | (unaudited) |  |  |  |
Current Assets: |  |  |  |  |  |
Cash and cash equivalents |  | $ | 19,744 |  |  | $ | 25,192 |
Receivables, net |  |  | 1,082 |  |  |  | 1,108 |
Prepaid expenses |  |  | 560 |  |  |  | 510 |
Inventories |  |  | 334 |  |  |  | 273 |
Other current assets |  |  | 1 |  |  |  | 113 |
Deferred income taxes |  |  | 235 |  |  |  | 90 |
Total Current Assets |  |  | 21,956 |  |  |  | 27,286 |
Property and equipment, net |  |  | 98,748 |  |  |  | 99,605 |
Goodwill |  |  | 4,823 |  |  |  | 4,833 |
Equity investment |  |  | 3,209 |  |  |  | 2,756 |
Deferred income taxes |  |  | 1,993 |  |  |  | 2,054 |
Other assets |  |  | 655 |  |  |  | 193 |
Total Assets |  | $ | 131,384 |  |  | $ | 136,727 |
LIABILITIES AND SHAREHOLDERS’ EQUITY |  |  |  |  |  |  |  |
Current Liabilities: |  |  |  |  |  |  |  |
Current portion of long-term debt |  | $ | 333 |  |  | $ | 9,100 |
Accounts payable and accrued liabilities |  |  | 5,424 |  |  |  | 6,666 |
Accrued payroll |  |  | 2,365 |  |  |  | 2,373 |
Taxes payable |  |  | 2,139 |  |  |  | 3,100 |
Deferred income taxes |  |  | 120 |  |  |  | 120 |
Total Current Liabilities |  |  | 10,381 |  |  |  | 21,359 |
Long-term debt, less current portion |  |  | 3,298 |  |  |  | - |
Taxes payable |  |  | 227 |  |  |  | 203 |
Deferred income taxes |  |  | 2,709 |  |  |  | 2,625 |
Total Liabilities |  |  | 16,615 |  |  |  | 24,187 |
Commitments and Contingencies |  |  |  |  |  |  |  |
Shareholders’ Equity: |  |  |  |  |  |  |  |
Preferred stock; $0.01 par value; 20,000,000 shares authorized; |  |  |  |  |  |  |  |
no shares issued or outstanding |  |  | - |  |  |  | - |
Common stock; $0.01 par value; 50,000,000 shares authorized; 24,233,174 and 23,993,174 shares issued; 24,117,362 and 23,877,362 shares outstanding |  |  | 242 |  |  |  | 240 |
Additional paid-in capital |  |  | 75,380 |  |  |  | 75,144 |
Accumulated other comprehensive earnings |  |  | 3,001 |  |  |  | 3,291 |
Retained earnings |  |  | 36,428 |  |  |  | 34,147 |
|  |  | 115,051 |  |  |  | 112,822 |
Treasury stock – 115,812 shares at cost |  |  | (282 | ) |  |  | (282 | )
Total Shareholders’ Equity |  |  | 114,769 |  |  |  | 112,540 |
Total Liabilities and Shareholders’ Equity |  | $ | 131,384 |  |  | $ | 136,727 |
See notes to condensed consolidated financial statements. |  |  |  |  |  |  |  |

3

CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)

|  | For the three months ended June 30, |  |  | For the six months ended June 30, |
Amounts in thousands, except for per share information |  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Operating revenue: |  |  |  |  |  |  |  |  |  |  |  |
Gaming |  | $ | 15,709 |  |  | $ | 15,928 |  |  | $ | 30,968 |  |  | $ | 30,753 |
Hotel, bowling, food and beverage |  |  | 3,135 |  |  |  | 3,141 |  |  |  | 6,456 |  |  |  | 6,384 |
Other |  |  | 1,103 |  |  |  | 1,004 |  |  |  | 2,046 |  |  |  | 1,939 |
Gross revenue |  |  | 19,947 |  |  |  | 20,073 |  |  |  | 39,470 |  |  |  | 39,076 |
Less: Promotional allowances |  |  | (2,156 | ) |  |  | (2,071 | ) |  |  | (4,110 | ) |  |  | (3,959 | )
Net operating revenue |  |  | 17,791 |  |  |  | 18,002 |  |  |  | 35,360 |  |  |  | 35,117 |
Operating costs and expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gaming |  |  | 7,459 |  |  |  | 7,341 |  |  |  | 14,692 |  |  |  | 14,272 |
Hotel, bowling, food and beverage |  |  | 2,420 |  |  |  | 2,553 |  |  |  | 4,857 |  |  |  | 5,064 |
General and administrative |  |  | 5,320 |  |  |  | 5,848 |  |  |  | 10,624 |  |  |  | 11,216 |
Depreciation |  |  | 1,180 |  |  |  | 1,665 |  |  |  | 2,358 |  |  |  | 3,306 |
Total operating costs and expenses |  |  | 16,379 |  |  |  | 17,407 |  |  |  | 32,531 |  |  |  | 33,858 |
Earnings from equity investment |  |  | 283 |  |  |  | 382 |  |  |  | 438 |  |  |  | 474 |
Earnings from operations |  |  | 1,695 |  |  |  | 977 |  |  |  | 3,267 |  |  |  | 1,733 |
Non-operating income (expense): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income |  |  | 23 |  |  |  | 5 |  |  |  | 29 |  |  |  | 7 |
Interest expense |  |  | (395 | ) |  |  | (197 | ) |  |  | (543 | ) |  |  | (443 | )
Gains on foreign currency transactions and other |  |  | 22 |  |  |  | 114 |  |  |  | 17 |  |  |  | 189 |
Non-operating income (expense), net |  |  | (350 | ) |  |  | (78 | ) |  |  | (497 | ) |  |  | (247 | )
Earnings before income taxes |  |  | 1,345 |  |  |  | 899 |  |  |  | 2,770 |  |  |  | 1,486 |
Income tax provision |  |  | 197 |  |  |  | 255 |  |  |  | 489 |  |  |  | 478 |
Net earnings |  | $ | 1,148 |  |  | $ | 644 |  |  | $ | 2,281 |  |  | $ | 1,008 |
Earnings per share: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 0.05 |  |  | $ | 0.03 |  |  | $ | 0.10 |  |  | $ | 0.04 |
Diluted |  | $ | 0.05 |  |  | $ | 0.03 |  |  | $ | 0.09 |  |  | $ | 0.04 |
See notes to condensed consolidated financial statements. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

4

CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) EARNINGS (Unaudited)

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Net earnings |  | $ | 1,148 |  |  | $ | 644 |  |  | $ | 2,281 |  |  | $ | 1,008 |
Foreign currency translation adjustments |  |  | (1,357 | ) |  |  | 80 |  |  |  | (290 | ) |  |  | 1,374 |
Comprehensive (loss) earnings |  | $ | (209 | ) |  | $ | 724 |  |  | $ | 1,991 |  |  | $ | 2,382 |
See notes to condensed consolidated financial statements. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

5

CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

|  | For the six months ended June 30, |
Amounts in thousands |  | 2012 |  |  | 2011 |
Cash Flows from Operating Activities: |  |  |
Net earnings |  | $ | 2,281 |  |  | $ | 1,008 |
Adjustments to reconcile net earnings to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation |  |  | 2,358 |  |  |  | 3,306 |
Loss on disposition of fixed assets |  |  | 22 |  |  |  | 53 |
Amortization of stock-based compensation |  |  | (2 | ) |  |  | 192 |
Amortization of deferred financing costs |  |  | 110 |  |  |  | 45 |
Deferred tax expense |  |  | 1 |  |  |  | 119 |
Earnings from equity investment |  |  | (438 | ) |  |  | (474 | )
Changes in Operating Assets and Liabilities: |  |  |  |  |  |  |  |
Receivables |  |  | 29 |  |  |  | 384 |
Prepaid expenses and other assets |  |  | (43 | ) |  |  | (288 | )
Accounts payable and accrued liabilities |  |  | (1,217 | ) |  |  | (114 | )
Inventories |  |  | (60 | ) |  |  | (2 | )
Other operating assets |  |  | (77 | ) |  |  | (50 | )
Accrued payroll |  |  | 5 |  |  |  | (479 | )
Taxes payable |  |  | (923 | ) |  |  | (1,093 | )
Net cash provided by operating activities |  |  | 2,046 |  |  |  | 2,607 |
Cash Flows from Investing Activities: |  |  |  |  |  |  |  |
Purchases of property and equipment |  |  | (1,620 | ) |  |  | (1,683 | )
Proceeds from disposition of assets |  |  | 2 |  |  |  | 16 |
Net cash used in investing activities |  |  | (1,618 | ) |  |  | (1,667 | )
Cash Flows from Financing Activities: |  |  |  |  |  |  |  |
Proceeds from borrowings |  |  | 3,626 |  |  |  | 0 |
Payment of deferred financing costs |  |  | (394 | ) |  |  | 0 |
Principal repayments |  |  | (9,092 | ) |  |  | (3,103 | )
Proceeds from equity investment dividend |  |  | 0 |  |  |  | 163 |
Proceeds from exercise of options |  |  | 240 |  |  |  | 15 |
Net cash used in financing activities |  | $ | (5,620 | ) |  | $ | (2,925 | )

| - | Continued -

6

CENTURY CASINOS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued)

|  | For the six months ended June 30, |
Amounts in thousands |  | 2012 |  |  | 2011 |
Effect of Exchange Rate Changes on Cash |  | $ | (256 | ) |  | $ | 281 |
Decrease in Cash and Cash Equivalents |  |  | (5,448 | ) |  |  | (1,704 | )
Cash and Cash Equivalents at Beginning of Period |  |  | 25,192 |  |  |  | 21,461 |
Cash and Cash Equivalents at End of Period |  | $ | 19,744 |  |  | $ | 19,757 |
Supplemental Disclosure of Cash Flow Information: |  |  |  |  |  |  |  |
Interest paid |  | $ | 486 |  |  | $ | 429 |
Income taxes paid |  | $ | 88 |  |  | $ | 149 |
See notes to condensed consolidated financial statements. |

7

CENTURY CASINOS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Century Casinos, Inc. (“CCI” or the “Company”) is an international casino entertainment company. As of June 30, 2012, the Company owned casino operations in North America; managed cruise ship-based casinos on international waters; and owned a management contract to manage the casino in the Radisson Aruba Resort, Casino & Spa. The Company also owns a 33.3% ownership interest in Casinos Poland Ltd (“CPL”), the owner and operator of eight casinos in Poland. The Company continues to pursue other projects in various stages of development.
The accompanying condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial reporting, the rules and regulations of the Securities and Exchange Commission which apply to interim financial statements and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated.
In the opinion of management, all adjustments considered necessary for fair presentation of financial position, results of operations and cash flows of the Company have been included. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K and 10-K/A for the year ended December 31, 2011. The results of operations for the period ended June 30, 2012 are not necessarily indicative of the operating results for the full year.
Presentation of Foreign Currency Amounts
Dollar amounts reported in this quarterly report are in U.S. dollars (“USD”) unless otherwise indicated. Transactions that are denominated in a foreign currency, which include the Canadian dollar (“CAD”), Euro (“€”) and Polish zloty (“PLN”) are translated and recorded at the exchange rate in effect on the date of the transaction. Commitments that are denominated in a foreign currency and all balance sheet accounts other than shareholders’ equity are translated and presented based on the exchange rate between such foreign currency and the U.S. dollar at the end of the reported periods. Current period transactions affecting the profit and loss of operations conducted in foreign currencies are valued at the average exchange rate between such foreign currency and the U.S. dollar for the period in which they are incurred.
The exchange rates to the U.S. dollar used to translate balances at the end of the reported periods are as follows:

|  | June 30, |  |  | December 31, |
Ending Rates |  | 2012 |  |  | 2011 |
Canadian dollar (CAD) |  |  | 1.0191 |  |  |  | 1.0170 |
Euros (€) |  |  | 0.7894 |  |  |  | 0.7709 |
Polish zloty (PLN) |  |  | 3.3885 |  |  |  | 3.4174 |
Source: Pacific Exchange Rate Service |  |  |  |  |  |  |  |

8

The average exchange rates to the U.S. dollar used to translate balances during each reported period are as follows:

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
Average Rates |  | 2012 |  |  | 2011 |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | % Change |
Canadian dollar (CAD) |  |  | 1.0104 |  |  |  | 0.9678 |  |  |  | (4.4 | %) |  |  | 1.0060 |  |  |  | 0.9769 |  |  |  | (3.0 | %)
Euros (€) |  |  | 0.7796 |  |  |  | 0.6947 |  |  |  | (12.2 | %) |  |  | 0.7712 |  |  |  | 0.7130 |  |  |  | (8.2 | %)
Polish zloty (PLN) |  |  | 3.3181 |  |  |  | 2.7495 |  |  |  | (20.7 | %) |  |  | 3.2724 |  |  |  | 2.8180 |  |  |  | (16.1 | %)
Source: Pacific Exchange Rate Service |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

2. EQUITY INVESTMENT IN UNCONSOLIDATED SUBSIDIARY
Following is the summarized financial information of CPL as of June 30, 2012 and December 31, 2011 and for the three and six months ended June 30, 2012 and 2011:

Amounts in thousands (in USD): |  | June 30, 2012 |  |  | December 31, 2011 |
Balance Sheet: |  |  |  |  |  |
Current assets |  | $ | 4,631 |  |  | $ | 4,061 |
Noncurrent assets |  | $ | 13,114 |  |  | $ | 9,523 |
Current liabilities |  | $ | 8,140 |  |  | $ | 4,393 |
Noncurrent liabilities |  | $ | 2,057 |  |  | $ | 3,230 |

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
|  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Operating Results |  |  |  |  |  |  |  |  |  |  |  |
Net operating revenue |  | $ | 10,911 |  |  | $ | 13,663 |  |  | $ | 21,357 |  |  | $ | 25,199 |
Net earnings |  | $ | 849 |  |  | $ | 1,147 |  |  | $ | 1,313 |  |  | $ | 1,422 |

The Company’s maximum exposure to losses at June 30, 2012 was $3.2 million, the value of its equity investment in CPL.
Changes in the carrying amount of the investment in CPL during the six months ended June 30, 2012 are as follows:

Amounts in thousands (in USD) |  | Total |
Balance – January 1, 2012 |  | $ | 2,756 |
Equity earnings |  |  | 438 |
Effect of foreign currency translation |  |  | 15 |
Balance – June 30, 2012 |  | $ | 3,209 |

9

3. GOODWILL
Changes in the carrying amount of goodwill related to the Company’s Edmonton property for the six months ended June 30, 2012 are as follows:

Amounts in thousands |  |  |
Balance – January 1, 2012 |  | $ | 4,833 |
Effect of foreign currency translation |  |  | (10 | )
Balance – June 30, 2012 |  | $ | 4,823 |

4. LONG-TERM DEBT
Long-term debt at June 30, 2012 and December 31, 2011 consisted of the following:

|  | June 30, |  |  | December 31, |
Amounts in thousands |  | 2012 |  |  | 2011 |
Credit Agreement - Bank of Montreal |  | $ | 3,631 |  |  | $ | 0 |
Mortgage - Edmonton |  |  | 0 |  |  |  | 9,100 |
Total long-term debt |  | $ | 3,631 |  |  | $ | 9,100 |
Less current portion |  |  | (333 | ) |  |  | (9,100 | )
Long-term portion |  | $ | 3,298 |  |  | $ | 0 |

Credit Agreement- Bank of Montreal
On May 23, 2012, the Company, through its subsidiaries Century Resorts Alberta, Inc. (“CRA”) and Century Casino Calgary Inc. (“CAL”) entered into a CAD 28.0 million ($27.5 million) credit agreement with the Bank of Montreal (the “BMO Credit Agreement”). Proceeds from the BMO Credit Agreement were used to repay the Company’s mortgage debt related to the Edmonton property (the “Edmonton Mortgage”) and will also be used to pursue the development or acquisition of new gaming opportunities and for general corporate purposes. The BMO Credit Agreement has a term of five years and is guaranteed by the Company.
The BMO Credit Agreement consists of three credit facilities to be utilized as follows:

1. | Credit Facility A is a CAD 1.0 million ($1.0 million) revolving credit facility to be used for the costs of the financing, ongoing working capital requirements and operating regulatory requirements.

2. | Credit Facility B is a CAD 25.0 million ($24.5 million) committed, non-revolving, reducing standby facility. Up to CAD 11 million ($10.8 million) of the Credit Facility B may be used to repay all or part of the Edmonton Mortgage with the remainder available for working capital requirements and general corporate purposes. As described below, CAD 3.7 million ($3.6 million) was drawn down under Credit Facility B and was used, with cash on hand, to repay in full the Edmonton Mortgage. Once the principal balance of the advance under Credit Facility B has been repaid, it cannot be re-borrowed.

10

3. | Credit Facility C is a CAD 2.0 million ($2.0 million) treasury management risk facility as defined by the BMO Credit Agreement.

As of June 30, 2012, the Company had approximately CAD 24.3 million ($23.8 million) available for borrowing under the BMO Credit Agreement.
The BMO Credit Agreement bears interest based on credit facilities as follows:

1. | Advances under Credit Facility A may be in the form of :

i. | Advances denominated in CAD and bearing interest at the lender’s floating rate for loans made in CAD plus a margin as defined by the BMO Credit Agreement, and/or

ii. | Advances denominated in USD and bearing interest at the lender’s floating rate for loan made in USD plus a margin as defined by the BMO Credit Agreement, and/or

iii. | Issuances of a CAD Letter of Credit (maximum face value CAD 100,000), bearing interest at a floating margin rate as defined by the BMO Credit Agreement.

2. | Advances under Credit Facility B may be in the form of:

i. | Advances denominated in CAD and bearing interest at the lender’s floating rate for loans made in CAD plus a margin as defined by the BMO Credit Agreement (CAD 500,000 minimum and CAD 100,000 increments thereafter);

ii. | Advances denominated in USD and bearing interest at the lender’s floating rate for loans made in USD plus a margin as defined by the BMO Credit Agreement ($500,000 minimum and $100,000 increments thereafter);

iii. | Advances denominated in USD and bearing interest at the LIBOR rate fixed for 1-6 months ($1 million minimum and $500,000 increments thereafter); and/or

iv. | A Bankers Acceptance denominated in CAD and bearing interest at a fixed rate as defined by the BMO Credit Agreement for 1-6 months (CAD 1 million minimum and CAD 500,000 increments thereafter).

3. | Longer term fixed rates of interest, up to and including the full five year term of the BMO Credit Agreement, can be achieved through the use of interest rate swaps with a deemed risk up to the maximum amount of Credit Facility C. As of June 30, 2012, no interest rate swaps were in use by the Company.

4. | Any funds that are not drawn down under either Credit Facility A or B are classified as a CAD Standby Facility.

11

Mortgage - Edmonton
On May 23, 2012, the Company repaid the outstanding balance of approximately $6.3 million on the Edmonton Mortgage. The repayment consisted of $6.1 million in principal and interest due on the Edmonton Mortgage and $0.2 million in prepayment penalties and unamortized deferred financing charges. This loan payoff was funded with a $3.6 million borrowing under the BMO Credit Agreement and $2.7 million of cash on hand. The repayment by the Company terminated the Edmonton Mortgage.
Deferred financing charges, which are reported as a component of other assets, are summarized as follows:

Credit Agreement - Bank of Montreal |  | June 30, |  |  | December 31, |
Amounts in thousands |  | 2012 |  |  | 2011 |
Deferred financing charges - current |  | $ | 79 |  |  | $ | 0 |
Deferred financing charges - long-term |  | $ | 308 |  |  | $ | 0 |
Total |  | $ | 387 |  |  | $ | 0 |
Mortgage - Edmonton |  | June 30, |  |  | December 31, |
Amounts in thousands |  |  | 2012 |  |  |  | 2011 |
Deferred financing charges - current |  | $ | 0 |  |  | $ | 101 |
Deferred financing charges - long-term |  | $ | 0 |  |  | $ | 0 |
Total |  | $ | 0 |  |  | $ | 101 |

Amortization expense relating to deferred financing charges was $0.1 million for both the six months ended June 30, 2012 and June 30, 2011, and is included in interest expense in the accompanying condensed consolidated statements of earnings.
As of June 30, 2012, the Company was in compliance with all covenants related to its borrowings. Covenants of the BMO Credit Agreement include the following:

a) | Senior Funded Debt to EBITDA Ratio as defined by the BMO Credit Agreement may not be greater than 3.00:1.00;

b) | Fixed Charge Coverage Ratio as defined by the BMO Credit Agreement may not be less than 1.20:1.00;

c) | CRA and CAL combined shareholder’s equity may not be less than CAD 20 million; and

d) | Capital expenditures in any fiscal year may not exceed CAD 4.0 million in aggregate, without the lender’s consent.

The consolidated weighted average interest rate on all borrowings for the Company was 17.2% for the six months ended June 30, 2012. The Company currently pays a floating interest rate on its borrowings under the BMO Credit Agreement. The current interest rate is approximately 4.0%. The weighted average interest rate is higher than the 7.0% interest rate of the Edmonton Mortgage and the 4.0% interest rate under on the BMO Credit Agreement because the Company wrote off a total of $0.1 million in deferred financing costs and paid $0.2 million in prepayment penalties in May 2012 in connection with the repayment of the Edmonton Mortgage.
12

As of June 30, 2012, scheduled maturities of the long-term debt is as follows:

Amounts in thousands |  | CAD |  |  | USD |
2012 |  | $ | 154 |  |  | $ | 151 |
2013 |  |  | 370 |  |  |  | 363 |
2014 |  |  | 370 |  |  |  | 363 |
2015 |  |  | 370 |  |  |  | 363 |
2016 |  |  | 370 |  |  |  | 363 |
Thereafter |  |  | 2,066 |  |  |  | 2,028 |
Total |  | $ | 3,700 |  |  | $ | 3,631 |

5. PROMOTIONAL ALLOWANCES
Hotel accommodations, bowling and food and beverage furnished without charge to customers are included in gross revenue at a value which approximates retail and are then deducted as complimentary services to arrive at net operating revenue.
The Company issues coupons for the purpose of generating future revenue. The cost of the coupons redeemed is applied against the revenue generated on the day of the redemption. In addition, members of the Company’s casinos’ player clubs earn points based on, among other things, their volume of play at the Company’s casinos. Players can accumulate points over time that they may redeem at their discretion under the terms of the program. Points can be redeemed for cash and/or various amenities at the casino, such as meals, hotel stays and gift shop items. The cost of the points is offset against the revenue in the period in which the points were earned. The value of unused or unredeemed points is included in accounts payable and accrued liabilities on the Company’s consolidated balance sheets. The expiration of unused points results in a reduction of the liability. As of June 30, 2012, the outstanding balance of this liability was $1.0 million.
Promotional allowances presented in the condensed consolidated statements of earnings include the following:

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
|  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Amounts in thousands |  |  |  |  |  |  |  |  |  |  |  |
Hotel, bowling, food and beverage |  | $ | 984 |  |  | $ | 909 |  |  | $ | 1,898 |  |  | $ | 1,741 |
Coupons |  |  | 487 |  |  |  | 502 |  |  |  | 941 |  |  |  | 947 |
Player points |  |  | 685 |  |  |  | 660 |  |  |  | 1,271 |  |  |  | 1,271 |
Total promotional allowances |  | $ | 2,156 |  |  | $ | 2,071 |  |  | $ | 4,110 |  |  | $ | 3,959 |

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6. INCOME TAXES
The Company records deferred tax assets and liabilities based on the difference between the financial statement and income tax basis of assets and liabilities using the enacted statutory tax rate in effect for the year these differences are expected to be taxable or reversed. Deferred income tax expenses or credits are based on the changes in the asset or liability from period to period. The recorded deferred tax assets are reviewed for impairment on a quarterly basis by reviewing the Company’s internal estimates for future taxable income.
As of June 30, 2012, the Company has established a valuation allowance for its U.S. deferred tax assets of $5.2 million, a $0.9 million valuation allowance on its Calgary property and a $1.3 million valuation allowance on the Century Casinos Europe subsidiary deferred tax assets due to the uncertainty of future taxable income. The Company assesses the continuing need for a valuation allowance that results from uncertainty regarding its ability to realize the benefits of the Company’s deferred tax assets. The ultimate realization of deferred income tax assets depends on generation of future taxable income in the jurisdictions where the assets are located during the periods in which those temporary differences become deductible. If the Company concludes that its prospects for the realization of its deferred tax assets are more likely than not, the Company will then reduce its valuation allowance as appropriate and credit income tax expense after considering the following factors:

· | The level of historical taxable income and projections for future taxable income in the jurisdictions where the assets are located over periods in which the deferred tax assets would be deductible;

· | Accumulation of net income before tax utilizing a look-back period of three years, and

· | Tax planning strategies.

The income tax provisions are based on estimated full-year earnings for financial reporting purposes adjusted for permanent differences. The Company’s provision for income taxes from operations consists of the following:

|  | For the six months |
Amounts in thousands |  | ended June 30, |
|  | 2012 |  |  | 2011 |
U.S. Federal - Current |  | $ | 122 |  |  | $ | 52 |
U.S. Federal - Deferred |  |  | 0 |  |  |  | 0 |
Provision for U.S. federal income taxes |  |  | 122 |  |  |  | 52 |
Foreign - Current |  | $ | 366 |  |  | $ | 307 |
Foreign - Deferred |  |  | 1 |  |  |  | 119 |
Provision for foreign income taxes |  |  | 367 |  |  |  | 426 |
Total provision for income taxes |  | $ | 489 |  |  | $ | 478 |

14

The Company’s income tax expense by jurisdiction is summarized in the table below:

|  | For the six months |  |  | For the six months |
Amounts in thousands |  | ended June 30, 2012 |  |  | ended June 30, 2011 |
|  | Pre-tax income |  |  | Income tax |  |  | Effective tax rate |  |  | Pre-tax income (loss) |  |  | Income tax |  |  | Effective tax rate |
Canada |  | $ | 1,563 |  |  | $ | 361 |  |  |  | 23.1 | % |  | $ | 1,258 |  |  | $ | 403 |  |  |  | 32.0 | %
United States |  |  | 144 |  |  |  | 122 |  |  |  | 85.1 | % |  |  | (1,056 | ) |  |  | 52 |  |  |  | -4.9 | %
Mauritius |  |  | 147 |  |  |  | 4 |  |  |  | 3.0 | % |  |  | 1,133 |  |  |  | 22 |  |  |  | 1.9 | %
Austria |  |  | 539 |  |  |  | 1 |  |  |  | 0.2 | % |  |  | (222 | ) |  |  | 1 |  |  |  | -0.5 | %
Poland |  |  | 377 |  |  |  | - |  |  |  | 0.0 | % |  |  | 373 |  |  |  | - |  |  |  | 0.0 | %
Total |  | $ | 2,770 |  |  | $ | 489 |  |  |  | 17.7 | % |  | $ | 1,486 |  |  | $ | 478 |  |  |  | 32.2 | %

The US income tax rate has increased significantly due to a one-time withholding tax payment of $0.1 million related to a Canadian intercompany payable.
7. EARNINGS PER SHARE
The calculation of basic earnings per share considers only weighted average outstanding common shares in the computation. The calculation of diluted earnings per share gives effect to all potentially dilutive securities. The calculation of diluted earnings per share is based upon the weighted average number of common shares outstanding during the period, plus, if dilutive, the assumed exercise of stock options using the treasury stock method and the assumed conversion of other convertible securities (using the “if converted” method) at the beginning of the year, or for the period outstanding during the year for current year issuances. Weighted average shares outstanding for the three and six months ended June 30, 2012 and 2011 were as follows:

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
|  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Weighted average common shares, basic |  |  | 23,890,405 |  |  |  | 23,717,165 |  |  |  | 23,883,919 |  |  |  | 23,714,215 |
Dilutive effect of stock options |  |  | 169,917 |  |  |  | 308,930 |  |  |  | 170,985 |  |  |  | 301,732 |
Weighted average common shares, diluted |  |  | 24,060,322 |  |  |  | 24,026,095 |  |  |  | 24,054,904 |  |  |  | 24,015,947 |

15

The following shares of restricted stock and stock options are anti-dilutive and have not been included in the weighted average shares outstanding calculation:

|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
|  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
Unvested restricted stock |  |  | - |  |  |  | 160,000 |  |  |  | - |  |  |  | 160,000 |
Stock options |  |  | 886,710 |  |  |  | 886,710 |  |  |  | 886,710 |  |  |  | 886,710 |

8. SEGMENT INFORMATION
The following summary provides information concerning amounts attributable to the Company’s principal geographic areas:

|  | Long Lived Assets |
|  | At June 30, |  |  | At December 31, |
Amounts in thousands |  | 2012 |  |  | 2011 |
United States |  | $ | 55,661 |  |  | $ | 56,294 |
International: |  |  |  |  |  |  |  |
Canada |  | $ | 48,771 |  |  | $ | 48,423 |
Europe |  |  | 3,647 |  |  |  | 3,228 |
International waters |  |  | 1,349 |  |  |  | 1,496 |
Total international |  |  | 53,767 |  |  |  | 53,147 |
Total |  | $ | 109,428 |  |  | $ | 109,441 |

|  | Net Operating Revenue |  |  | Net Operating Revenue |
|  | For the three months |  |  | For the six months |
|  | ended June 30, |  |  | ended June 30, |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
United States |  | $ | 7,731 |  |  | $ | 7,731 |  |  | $ | 15,119 |  |  | $ | 14,969 |
International: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Canada |  | $ | 8,404 |  |  | $ | 8,652 |  |  | $ | 16,947 |  |  | $ | 16,994 |
International waters |  |  | 1,578 |  |  |  | 1,509 |  |  |  | 3,138 |  |  |  | 2,931 |
Aruba |  |  | 78 |  |  |  | 110 |  |  |  | 156 |  |  |  | 223 |
Total international |  |  | 10,060 |  |  |  | 10,271 |  |  |  | 20,241 |  |  |  | 20,148 |
Total |  | $ | 17,791 |  |  | $ | 18,002 |  |  | $ | 35,360 |  |  | $ | 35,117 |

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements, Business Environment and Risk Factors
This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995. In addition, Century Casinos, Inc. (together with its subsidiaries, the “Company”) may make other written and oral communications from time to time that contain such statements. Forward-looking statements include statements as to industry trends and future expectations of the Company and other matters that do not relate strictly to historical facts and are based on certain assumptions by management at the time such statements are made. These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” and similar expressions or variations. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements include, among others, the risks described in the section entitled “Risk Factors” under Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2011. We caution the reader to carefully consider such factors. Furthermore, such forward-looking statements speak only as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.
References in this item to “we,” “our,” or “us” are to the Company and its subsidiaries on a consolidated basis unless the context otherwise requires. The term “CAD” refers to Canadian dollars.
Amounts presented in this Item 2 are rounded. As such, rounding differences could occur in period over period changes and percentages reported throughout this Item 2.
OVERVIEW
Since our inception in 1992, we have been primarily engaged in developing and operating gaming establishments and related lodging, restaurant and entertainment facilities. Our primary source of revenue is from the net proceeds of our gaming machines and tables, with ancillary revenue generated from the hotel, restaurant, bowling and entertainment facilities that are a part of the casinos.
We currently own, operate and manage the following casinos through wholly-owned subsidiaries:

- | The Century Casino & Hotel in Edmonton, Alberta, Canada;
- | The Century Casino Calgary, Alberta, Canada;
- | The Century Casino & Hotel in Central City, Colorado; and
- | The Century Casino & Hotel in Cripple Creek, Colorado.

17

We also operate 12 ship-based casinos onboard four cruise lines; Oceania Cruises, TUI Cruises, Windstar Cruises and Regent Seven Seas Cruises.
The following table summarizes the cruise lines for which we have entered into agreements and the associated ships on which we operate ship-based casinos.

Cruise Line | Ship
Oceania Cruises | Regatta
Oceania Cruises | Nautica
Oceania Cruises | Insignia*
Oceania Cruises | Marina
Oceania Cruises | Riviera**
TUI Cruises | Mein Schiff 1
TUI Cruises | Mein Schiff 2
Windstar Cruises | Wind Surf
Windstar Cruises | Wind Star
Windstar Cruises | Wind Spirit
Regent Seven Seas Cruises | Seven Seas Voyager
Regent Seven Seas Cruises | Seven Seas Mariner
Regent Seven Seas Cruises | Seven Seas Navigator

* The casino operation on board Insignia was suspended on April 5, 2012, as the vessel was leased to a different cruise line by Oceania Cruises. We will not operate the ship-based casino as long as it is leased to a different cruise line.
** The Riviera ship-based casino began operations on May 3, 2012.
We also hold a 33.3% ownership interest in and actively participate in the management of Casinos Poland Ltd (“CPL”), the owner and operator of eight casinos in Warsaw, Katowice, Gydnia, Wroclaw, Lodz (opened February 16, 2012) Krakow (opened March 29, 2012), Sosnowiec (opened April 18, 2012) and Posnan (opened June 28, 2012) in Poland. We account for this investment under the equity method.
The Lodz casino is undergoing a full refurbishment and will have a grand re-opening during the fourth quarter of 2012. CPL has obtained an additional gaming license in the city of Plock, which is scheduled to open in the second half of 2012. In addition, CPL is participating in other license applications, including Warsaw. Decisions from the Polish Minister of Finance on these applications are pending.
We have a long-term management agreement to direct the operation of the casino at the Radisson Aruba Resort, Casino & Spa. We receive a management fee consisting of a fixed fee, plus a percentage of earnings before interest, taxes, depreciation and amortization.
18

Presentation of Foreign Currency Amounts - The average exchange rates to the U.S. dollar used to translate balances during each reported period are as follows:

|  | For the three months ended June 30, |  |  | For the six months ended June 30, |
Average Rates |  | 2012 |  |  | 2011 |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | % Change |
Canadian dollar (CAD) |  |  | 1.0104 |  |  |  | 0.9678 |  |  |  | (4.4 | %) |  |  | 1.0060 |  |  |  | 0.9769 |  |  |  | (3.0 | %)
Euros (€) |  |  | 0.7796 |  |  |  | 0.6947 |  |  |  | (12.2 | %) |  |  | 0.7712 |  |  |  | 0.7130 |  |  |  | (8.2 | %)
Polish zloty (PLN) |  |  | 3.3181 |  |  |  | 2.7495 |  |  |  | (20.7 | %) |  |  | 3.2724 |  |  |  | 2.8180 |  |  |  | (16.1 | %)
Source: Pacific Exchange Rate Service |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

RECENT DEVELOPMENTS
Developments that we believe have impacted or will impact our results of operations are discussed below.
Century Casino & Hotel (Edmonton, Alberta, Canada)
On July 13, 2012, the Alberta Gaming and Liquor Commission approved the addition of 30 slot machines to the gaming floor. The additional slot machines are expected to be added gradually during the third quarter of 2012. Once added, the 30 additional machines will bring the total slot machine count to 750 at our property in Edmonton.
In June 2012, construction began on Fort Road immediately in front of the casino entrance. Construction is expected to last through September 2012. This may adversely affect traffic to our casino during the third quarter of 2012.
Century Casino & Hotel (Cripple Creek, Colorado, United States)
The Waldo Canyon Wildfire, which occurred in and near Colorado Springs, Colorado in late June and early July 2012, had a significant negative impact on our business in Cripple Creek during the second quarter of 2012. Several thousand people in Colorado Springs, the metropolitan population which the casino primarily serves, were evacuated and the main highway to the casino, Highway 24, was closed for eight days from June 24, 2012 through July 1, 2012. We estimate that this event adversely affected our revenues for the second quarter by $0.2 million.
In August 2012, new owners of the Gold Rush Casino in Cripple Creek are planning to open the casino with approximately 300 slot machines and 3 table games. This casino is directly across the street from our property in Cripple Creek, and management believes the new casino will add additional competition to the already very competitive Cripple Creek market.
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DISCUSSION OF RESULTS
Century Casinos, Inc. and Subsidiaries

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | Change |  |  | % Change |
Gaming Revenue |  | $ | 15,709 |  |  | $ | 15,928 |  |  | $ | (219 | ) |  |  | (1.4 | %) |  | $ | 30,968 |  |  | $ | 30,753 |  |  | $ | 215 |  |  |  | 0.7 | %
Hotel, Bowling, Food and Beverage Revenue |  |  | 3,135 |  |  |  | 3,141 |  |  |  | (6 | ) |  |  | (0.2 | %) |  |  | 6,456 |  |  |  | 6,384 |  |  |  | 72 |  |  |  | 1.1 | %
Other Revenue |  |  | 1,103 |  |  |  | 1,004 |  |  |  | 99 |  |  |  | 9.9 | % |  |  | 2,046 |  |  |  | 1,939 |  |  |  | 107 |  |  |  | 5.5 | %
Gross Revenue |  |  | 19,947 |  |  |  | 20,073 |  |  |  | (126 | ) |  |  | (0.6 | %) |  |  | 39,470 |  |  |  | 39,076 |  |  |  | 394 |  |  |  | 1.0 | %
Less Promotional Allowances |  |  | (2,156 | ) |  |  | (2,071 | ) |  |  | 85 |  |  |  | 4.1 | % |  |  | (4,110 | ) |  |  | (3,959 | ) |  |  | 151 |  |  |  | 3.8 | %
Net Operating Revenue |  |  | 17,791 |  |  |  | 18,002 |  |  |  | (211 | ) |  |  | (1.2 | %) |  |  | 35,360 |  |  |  | 35,117 |  |  |  | 243 |  |  |  | 0.7 | %
Gaming Expenses |  |  | (7,459 | ) |  |  | (7,341 | ) |  |  | 118 |  |  |  | 1.6 | % |  |  | (14,692 | ) |  |  | (14,272 | ) |  |  | 420 |  |  |  | 2.9 | %
Hotel, Bowling, Food and Beverage Expenses |  |  | (2,420 | ) |  |  | (2,553 | ) |  |  | (133 | ) |  |  | (5.2 | %) |  |  | (4,857 | ) |  |  | (5,064 | ) |  |  | (207 | ) |  |  | (4.1 | %)
General and Administrative Expenses |  |  | (5,320 | ) |  |  | (5,848 | ) |  |  | (528 | ) |  |  | (9.0 | %) |  |  | (10,624 | ) |  |  | (11,216 | ) |  |  | (592 | ) |  |  | (5.3 | %)
Total Operating Costs and Expenses |  |  | (16,379 | ) |  |  | (17,407 | ) |  |  | (1,028 | ) |  |  | (5.9 | %) |  |  | (32,531 | ) |  |  | (33,858 | ) |  |  | (1,327 | ) |  |  | (3.9 | %)
Earnings from Equity Investment |  |  | 283 |  |  |  | 382 |  |  |  | (99 | ) |  |  | (25.9 | %) |  |  | 438 |  |  |  | 474 |  |  |  | (36 | ) |  |  | (7.6 | %)
Earnings from Operations |  |  | 1,695 |  |  |  | 977 |  |  |  | 718 |  |  |  | 73.5 | % |  |  | 3,267 |  |  |  | 1,733 |  |  |  | 1,534 |  |  |  | 88.5 | %
Net Earnings |  | $ | 1,148 |  |  | $ | 644 |  |  | $ | 504 |  |  |  | 78.3 | % |  | $ | 2,281 |  |  | $ | 1,008 |  |  | $ | 1,273 |  |  |  | 126.3 | %
Earnings Per Share |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 0.05 |  |  | $ | 0.03 |  |  | $ | 0.02 |  |  |  | 66.7 | % |  | $ | 0.10 |  |  | $ | 0.04 |  |  | $ | 0.06 |  |  |  | 150.0 | %
Diluted |  | $ | 0.05 |  |  | $ | 0.03 |  |  | $ | 0.02 |  |  |  | 66.7 | % |  | $ | 0.09 |  |  | $ | 0.04 |  |  | $ | 0.05 |  |  |  | 125.0 | %

Net operating revenue decreased by $0.2 million, or 1.2%, and increased by $0.2 million, or 0.7%, for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011. Following is a breakout of net operating revenue by property or category for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011:

● | Net operating revenue at our property in Edmonton decreased by $0.2 million, or 2.9%, and increased by less than $0.1 million, or 0.1%;
● | Net operating revenue at our property in Calgary decreased by $0.1 million, or 2.8%, and decreased by $0.1 million, or 1.1%;
● | Net operating revenue at our property in Central City increased by $0.1 million, or 1.3%, and increased by $0.2 million, or 1.9%;
● | Net operating revenue at our property in Cripple Creek decreased by $0.1 million, or 1.9%, and decreased by less than $0.1 million, or 0.3%; and
● | Net operating revenue from our ship-based casinos and other increased by less than $0.1 million, or 2.3%, and increased by $0.1 million, or 4.4%.

20

Total operating costs and expenses decreased by $1.0 million, or 5.9%, and $1.3 million, or 3.9%, for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011. Following is a breakout of total operating costs and expenses by property or category for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011:

· | Total operating costs and expenses at our property in Edmonton decreased by $0.1 million, or 2.7%, and decreased by $0.1 million, or 1.2%;

· | Total operating costs and expenses at our property in Calgary increased by less than $0.1 million, or 1.4%, and decreased by $0.1 million, or 1.7%;

· | Total operating costs and expenses at our property in Central City decreased by $0.3 million, or 7.2%, and decreased by $0.5 million, or 6.1%;

· | Total operating costs and expenses at our property in Cripple Creek decreased by $0.1 million, or 4.0%, and decreased by less than $0.1 million, or 1.3%;

· | Total operating costs and expenses for our ship-based casinos and other increased by $0.1 million, or 6.5%, and increased by $0.2 million, or 6.2%; and

· | Total operating costs and expenses for corporate other decreased by $0.6 million, or 31.4%, and decreased by $0.7 million, or 21.6%.

As a result of the foregoing, net earnings increased by $0.5 million, or 78.3%, and $1.3 million, or 126.3%, for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011. Following is a breakout of net earnings by property or category for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011:

● | Net earnings at our property in Edmonton decreased by $0.1 million, or 9.1%, and increased by $0.1 million, or 3.5%;
● | Net earnings at our property in Calgary decreased by less than $0.1 million, or 26.0%, and increased by $0.2 million, or 64.4%;
● | Net earnings at our property in Central City increased by $0.2 million, or 123.7%, and increased by $0.4 million, or 108.6%;
● | Net earnings at our property in Cripple Creek increased by less than $0.1 million, or 11.9%, and increased by less than $0.1 million, or 7.3%;
● | Net earnings from our ship-based casinos and other decreased by $0.1 million, or 43.1%, and decreased by $0.1 million, or 21.5%; and
● | Net loss for corporate other decreased by $0.5 million, or 41.8%, and decreased by $0.7 million, or 34.9%.

Results by property are discussed in further detail in the following pages.
21

Casinos
Edmonton

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
Gaming Revenue |  | $ | 4,290 |  |  | $ | 4,452 |  |  | $ | (162 | ) |  |  | (3.6 | %) |  | $ | 8,468 |  |  | $ | 8,536 |  |  | $ | (68 | ) |  |  | (0.8 | %)
Hotel, Food and Beverage Revenue |  |  | 1,433 |  |  |  | 1,449 |  |  |  | (16 | ) |  |  | (1.1 | %) |  |  | 2,911 |  |  |  | 2,871 |  |  |  | 40 |  |  |  | 1.4 | %
Other Revenue |  |  | 569 |  |  |  | 533 |  |  |  | 36 |  |  |  | 6.8 | % |  |  | 1,097 |  |  |  | 997 |  |  |  | 100 |  |  |  | 10.0 | %
Gross Revenue |  |  | 6,292 |  |  |  | 6,434 |  |  |  | (142 | ) |  |  | (2.2 | %) |  |  | 12,476 |  |  |  | 12,404 |  |  |  | 72 |  |  |  | 0.6 | %
Less Promotional Allowances |  |  | (286 | ) |  |  | (249 | ) |  |  | 37 |  |  |  | 14.9 | % |  |  | (528 | ) |  |  | (466 | ) |  |  | 62 |  |  |  | 13.3 | %
Net Operating Revenue |  |  | 6,006 |  |  |  | 6,185 |  |  |  | (179 | ) |  |  | (2.9 | %) |  |  | 11,948 |  |  |  | 11,938 |  |  |  | 10 |  |  |  | 0.1 | %
Gaming Expenses |  |  | (1,681 | ) |  |  | (1,681 | ) |  |  | 0 |  |  |  | 0.0 | % |  |  | (3,390 | ) |  |  | (3,293 | ) |  |  | 97 |  |  |  | 2.9 | %
Hotel, Food and Beverage Expenses |  |  | (1,032 | ) |  |  | (959 | ) |  |  | 73 |  |  |  | 7.6 | % |  |  | (2,024 | ) |  |  | (1,882 | ) |  |  | 142 |  |  |  | 7.5 | %
General and Administrative Expenses |  |  | (1,324 | ) |  |  | (1,382 | ) |  |  | (58 | ) |  |  | (4.2 | %) |  |  | (2,674 | ) |  |  | (2,760 | ) |  |  | (86 | ) |  |  | (3.1 | %)
Total Operating Costs and Expenses |  |  | (4,281 | ) |  |  | (4,399 | ) |  |  | (118 | ) |  |  | (2.7 | %) |  |  | (8,574 | ) |  |  | (8,676 | ) |  |  | (102 | ) |  |  | (1.2 | %)
Earnings from Operations |  |  | 1,725 |  |  |  | 1,786 |  |  |  | (61 | ) |  |  | (3.4 | %) |  |  | 3,374 |  |  |  | 3,262 |  |  |  | 112 |  |  |  | 3.4 | %
Net Earnings |  | $ | 1,075 |  |  | $ | 1,182 |  |  | $ | (107 | ) |  |  | (9.1 | %) |  | $ | 2,153 |  |  | $ | 2,080 |  |  | $ | 73 |  |  |  | 3.5 | %

Three Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Edmonton decreased by $0.2 million, or 2.9%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net operating revenue is due to a decrease in the average exchange rate between the U.S. dollar and Canadian dollar of 4.4% for the three months ended June 30, 2012 compared to the three months June 30, 2011 (the “4.4% exchange rate decrease”).
In CAD, net operating revenue increased by $0.1 million, or 1.3%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase is due to increases in gaming, hotel, food, beverage and other revenue for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase in gaming revenue is due to 32 additional slot machines added to the floor during the second quarter of 2012. The increase in hotel, food and beverage revenue is due to higher hotel room occupancy. The increase in other revenue is due to increased showroom and Comedy Club ticket sales for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Total operating costs and expenses decreased by $0.1 million, or 2.7%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in total operating costs and expenses occurred as a result of the 4.4% exchange rate decrease.
In CAD, total operating costs and expense increased by $0.1 million, 1.6%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase is due to higher advertising, promotional, food and payroll costs of $0.2 million offset by a decrease in depreciation expense of $0.1 million for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
As a result of the foregoing, earnings from operations decreased by $0.1 million, or 3.4%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. In CAD, earnings from operations increased by less than $0.1 million, or 0.6%, for the three months ended June 30, 2012 as compared to the three months ended June 30, 2011.
22

Net earnings decreased by $0.1 million, or 9.1%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net earnings is due to foregoing operational items as well as an increase in interest expense and deferred financing charges of $0.2 million resulting from prepayment penalties related to early payoff of the mortgage related to the Edmonton property (“Edmonton Mortgage”) offset by a decrease in income tax expense of $0.1 million. In CAD, net earnings decreased by $0.2 million, or 22.0%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net earnings is due to an increase in interest expense of $0.2 million from the early payoff of the Edmonton Mortgage and an increase in foreign currency losses of $0.2 million due to the 4.4% exchange rate decrease offset by a decrease in income tax expense of $0.1 million.
Six Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Edmonton increased by less than $0.1 million, or 0.1%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in net operating revenue is due to increases in hotel, food, beverage and other revenue offset by a decrease in gaming revenue for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
The increase in hotel, food and beverage revenue is due to higher hotel room occupancy, increased customer volumes on the gaming floor as well as increased showroom event attendance for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in other revenue is due to increased showroom and Comedy Club ticket sales for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in gaming revenue is due a decrease in the average exchange rate between the U.S. dollar and Canadian dollar of 3.0% for the six months ended June 30, 2012 compared to the three months June 30, 2011 (the “3.0% exchange rate decrease”). In CAD, gaming revenue increased by $0.2 million, or 2.2%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011 due to a total of 56 additional slot machines added to the floor during the third quarter of 2011 and first and second quarter of 2012. In CAD, net operating revenue increased by $0.4 million, or 3.1%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
Total operating costs and expenses decreased by $0.1 million, or 1.2%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in total operating costs and expenses is due to the 3.0% exchange rate decrease.
In CAD, total operating costs and expense increased by $0.2 million, or 1.8%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase is due to higher advertising, promotional, food and payroll costs of $0.4 million offset by a decrease in depreciation expense of $0.2 million for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by $0.1 million, or 3.4%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. In CAD, earnings from operations increased by $0.2, or 6.6%, million for the six months ended June 30, 2012 as compared to the six months ended June 30, 2011. In addition, net earnings increased by $0.1 million, or 3.5%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. In CAD, net earnings increased by $0.1 million, or 2.7%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
23

Calgary

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
Gaming Revenue |  | $ | 1,588 |  |  | $ | 1,646 |  |  | $ | (58 | ) |  |  | (3.5 | %) |  | $ | 3,266 |  |  | $ | 3,163 |  |  | $ | 103 |  |  |  | 3.3 | %
Bowling, Food and Beverage Revenue |  |  | 683 |  |  |  | 747 |  |  |  | (64 | ) |  |  | (8.6 | %) |  |  | 1,533 |  |  |  | 1,711 |  |  |  | (178 | ) |  |  | (10.4 | %)
Other Revenue |  |  | 283 |  |  |  | 211 |  |  |  | 72 |  |  |  | 34.1 | % |  |  | 457 |  |  |  | 436 |  |  |  | 21 |  |  |  | 4.8 | %
Gross Revenue |  |  | 2,554 |  |  |  | 2,604 |  |  |  | (50 | ) |  |  | (1.9 | %) |  |  | 5,256 |  |  |  | 5,310 |  |  |  | (54 | ) |  |  | (1.0 | %)
Less Promotional Allowances |  |  | (156 | ) |  |  | (137 | ) |  |  | 19 |  |  |  | 13.9 | % |  |  | (257 | ) |  |  | (254 | ) |  |  | 3 |  |  |  | 1.2 | %
Net Operating Revenue |  |  | 2,398 |  |  |  | 2,467 |  |  |  | (69 | ) |  |  | (2.8 | %) |  |  | 4,999 |  |  |  | 5,056 |  |  |  | (57 | ) |  |  | (1.1 | %)
Gaming Expenses |  |  | (1,089 | ) |  |  | (912 | ) |  |  | 177 |  |  |  | 19.4 | % |  |  | (2,052 | ) |  |  | (1,859 | ) |  |  | 193 |  |  |  | 10.4 | %
Bowling, Food and Beverage Expenses |  |  | (517 | ) |  |  | (666 | ) |  |  | (149 | ) |  |  | (22.4 | %) |  |  | (1,106 | ) |  |  | (1,383 | ) |  |  | (277 | ) |  |  | (20.0 | %)
General and Administrative Expenses |  |  | (762 | ) |  |  | (769 | ) |  |  | (7 | ) |  |  | (0.9 | %) |  |  | (1,558 | ) |  |  | (1,595 | ) |  |  | (37 | ) |  |  | (2.3 | %)
Total Operating Costs and Expenses |  |  | (2,577 | ) |  |  | (2,541 | ) |  |  | 36 |  |  |  | 1.4 | % |  |  | (5,129 | ) |  |  | (5,220 | ) |  |  | (91 | ) |  |  | (1.7 | %)
(Losses) from Operations |  |  | (179 | ) |  |  | (74 | ) |  |  | (105 | ) |  |  | (141.9 | %) |  |  | (130 | ) |  |  | (164 | ) |  |  | 34 |  |  |  | 20.7 | %
Net (Loss) |  | $ | (92 | ) |  | $ | (73 | ) |  | $ | (19 | ) |  |  | (26.0 | %) |  | $ | (84 | ) |  | $ | (236 | ) |  | $ | 152 |  |  |  | 64.4 | %

Three Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Calgary decreased by $0.1 million, or 2.8%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net operating revenue is due to the 4.4% exchange rate decrease.
In CAD, net operating revenue increased by less than $0.1 million, or 1.5%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. Net operating revenue increased due to increased other revenue of $0.1 million, or 41.4%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2012 due to higher showroom ticket sales when the casino began self-promoting concert events at the casino and featured a concert by BB King. The increase in other revenue was offset by a less than $0.1 million, or 5.0% decrease in bowling, food and beverage revenue due to a decrease in the participation of bowling leagues for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Total operating costs and expenses increased by less than $0.1 million, or 1.4%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase is due to higher advertising, promotional, food and payroll costs for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. In CAD, total operating costs and expenses in Calgary increased by $0.2 million, or 5.9%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
As a result of the foregoing, earnings from operations decreased by $0.1 million, or 141.9%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. In CAD, earnings from operations decreased by $0.1 million, or 152.8% for the three months ended June 30, 2012 as compared to the three months ended June 30, 2011.
24

Net earnings decreased by less than $0.1 million, or 26.0%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net earnings is due to the foregoing operational items as well as an increase in income tax benefit of $0.1 million. In CAD, net earnings decreased by $0.2 million, or 700.0%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in net earnings is due to an increase in foreign currency losses of $0.2 million due to the 4.4% exchange rate decrease partially offset by an increase in the income tax benefit of $0.1 million.
Six Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Calgary decreased by $0.1 million, or 1.1%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in net operating revenue is due to the 3.0% exchange rate decrease.
In CAD, net operating revenue increased by $0.1 million, or 1.8%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. Net operating revenue increased due to higher gaming revenue of $0.2 million, or 6.3%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in gaming revenue is due to an enhanced slot floor layout and improved slot machine mix for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increased gaming revenue was offset by a $0.1 million, or 8.0%, decrease in bowling, food and beverage revenue. The decrease in bowling, food and beverage revenue is due to a decrease in the participation of bowling leagues for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
Total operating costs and expenses decreased by $0.1 million, or 1.7%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in total operating costs and expenses is due to the 3.0% exchange rate decrease.
In CAD, total operating costs and expenses increased by $0.1 million, or 1.2%, primarily due to increased depreciation costs for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by less than $0.1 million, or 20.7%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. In CAD, earnings from operations increased by less than $0.1 million, or 18.0%, for the six months ended June 30, 2012 as compared to the six months ended June 30, 2011.
Net earnings increased by $0.2 million, or 64.4%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in net earnings is due to foregoing operational items as well as an increase in income tax benefit of $0.1 million and a decrease in foreign currency losses of $0.1 million due to the 3.0% exchange rate decrease. In CAD, net earnings decreased by $0.2 million, or 279.0%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in net earnings is due an increase in foreign currency losses of $0.2 million due to the 3.0% exchange rate decrease.
25

Central City

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
Gaming Revenue |  | $ | 4,947 |  |  | $ | 4,930 |  |  | $ | 17 |  |  |  | 0.3 | % |  | $ | 9,755 |  |  | $ | 9,694 |  |  | $ | 61 |  |  |  | 0.6 | %
Hotel, Food and Beverage Revenue |  |  | 637 |  |  |  | 601 |  |  |  | 36 |  |  |  | 6.0 | % |  |  | 1,294 |  |  |  | 1,159 |  |  |  | 135 |  |  |  | 11.6 | %
Other Revenue |  |  | 48 |  |  |  | 40 |  |  |  | 8 |  |  |  | 20.0 | % |  |  | 99 |  |  |  | 75 |  |  |  | 24 |  |  |  | 32.0 | %
Gross Revenue |  |  | 5,632 |  |  |  | 5,571 |  |  |  | 61 |  |  |  | 1.1 | % |  |  | 11,148 |  |  |  | 10,928 |  |  |  | 220 |  |  |  | 2.0 | %
Less Promotional Allowances |  |  | (1,051 | ) |  |  | (1,051 | ) |  |  | 0 |  |  |  | 0.0 | % |  |  | (2,058 | ) |  |  | (2,008 | ) |  |  | 50 |  |  |  | 2.5 | %
Net Operating Revenue |  |  | 4,581 |  |  |  | 4,520 |  |  |  | 61 |  |  |  | 1.3 | % |  |  | 9,090 |  |  |  | 8,920 |  |  |  | 170 |  |  |  | 1.9 | %
Gaming Expenses |  |  | (2,119 | ) |  |  | (2,157 | ) |  |  | (38 | ) |  |  | (1.8 | %) |  |  | (4,186 | ) |  |  | (4,216 | ) |  |  | (30 | ) |  |  | (0.7 | %)
Hotel, Food and Beverage Expenses |  |  | (520 | ) |  |  | (540 | ) |  |  | (20 | ) |  |  | (3.7 | %) |  |  | (1,052 | ) |  |  | (1,038 | ) |  |  | 14 |  |  |  | 1.3 | %
General and Administrative Expenses |  |  | (956 | ) |  |  | (886 | ) |  |  | 70 |  |  |  | 7.9 | % |  |  | (1,900 | ) |  |  | (1,772 | ) |  |  | 128 |  |  |  | 7.2 | %
Total Operating Costs and Expenses |  |  | (3,942 | ) |  |  | (4,247 | ) |  |  | (305 | ) |  |  | (7.2 | %) |  |  | (7,839 | ) |  |  | (8,345 | ) |  |  | (506 | ) |  |  | (6.1 | %)
Earnings from Operations |  |  | 639 |  |  |  | 273 |  |  |  | 366 |  |  |  | 134.1 | % |  |  | 1,251 |  |  |  | 575 |  |  |  | 676 |  |  |  | 117.6 | %
Net Earnings |  | $ | 396 |  |  | $ | 177 |  |  | $ | 219 |  |  |  | 123.7 | % |  | $ | 776 |  |  | $ | 372 |  |  | $ | 404 |  |  |  | 108.6 | %

Three Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Central City increased by $0.1 million, or 1.3%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase in net operating revenue is due to increases in gaming, hotel, food and beverage revenue for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase in hotel, food and beverage revenue is due to a new menu introduced in both the grill and deli for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The Central City market increased by 12% and the market share at our property in Central City decreased by 9% for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Total operating costs and expenses decreased by $0.3 million, or 7.2%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease in total operating costs and expenses is due to a $0.3 million decrease in depreciation expense and overall management of operating costs for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by $0.4 million, or 134.1%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Net earnings increased by $0.2 million, or 123.7%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase in net earnings of $0.2 million compared to $0.4 million increase in earnings from operations is due an increase income tax expense of $0.2 million for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
26

Six Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Central City increased by $0.2 million, or 1.9%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in net operating revenue is due to increases in gaming, hotel, food and beverage revenue for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in gaming revenue is due to an increase in customer volume and table games hold percentage for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in hotel, food and beverage revenue is due to a new menu introduced in both the grill and deli for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The Central City market increased by 13%, while the market share for our property in Central City decreased by 10% for the six months ended June 30, 2012 compared to the six months ended June 30, 2011,
Total operating costs and expenses decreased by $0.5 million, or 6.1%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease in total operating costs and expenses is due to a $0.6 million decrease in depreciation expense and overall management of operating costs for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by $0.7 million, or 117.6%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
Net earnings increased by $0.4 million, or 108.6%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase in net earnings of $0.4 million compared to the $0.7 million increase in earnings from operations is due an increase income tax expense of $0.3 million for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
27

Cripple Creek

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
Gaming Revenue |  | $ | 3,403 |  |  | $ | 3,474 |  |  | $ | (71 | ) |  |  | (2.0 | %) |  | $ | 6,527 |  |  | $ | 6,588 |  |  | $ | (61 | ) |  |  | (0.9 | %)
Hotel, Food and Beverage Revenue |  |  | 382 |  |  |  | 343 |  |  |  | 39 |  |  |  | 11.4 | % |  |  | 718 |  |  |  | 644 |  |  |  | 74 |  |  |  | 11.5 | %
Other Revenue |  |  | 28 |  |  |  | 27 |  |  |  | 1 |  |  |  | 3.7 | % |  |  | 51 |  |  |  | 48 |  |  |  | 3 |  |  |  | 6.3 | %
Gross Revenue |  |  | 3,813 |  |  |  | 3,844 |  |  |  | (31 | ) |  |  | (0.8 | %) |  |  | 7,296 |  |  |  | 7,280 |  |  |  | 16 |  |  |  | 0.2 | %
Less Promotional Allowances |  |  | (663 | ) |  |  | (633 | ) |  |  | 30 |  |  |  | 4.7 | % |  |  | (1,267 | ) |  |  | (1,231 | ) |  |  | 36 |  |  |  | 2.9 | %
Net Operating Revenue |  |  | 3,150 |  |  |  | 3,211 |  |  |  | (61 | ) |  |  | (1.9 | %) |  |  | 6,029 |  |  |  | 6,049 |  |  |  | (20 | ) |  |  | (0.3 | %)
Gaming Expenses |  |  | (1,308 | ) |  |  | (1,364 | ) |  |  | (56 | ) |  |  | (4.1 | %) |  |  | (2,559 | ) |  |  | (2,520 | ) |  |  | 39 |  |  |  | 1.5 | %
Hotel, Food and Beverage Expenses |  |  | (351 | ) |  |  | (388 | ) |  |  | (37 | ) |  |  | (9.5 | %) |  |  | (675 | ) |  |  | (761 | ) |  |  | (86 | ) |  |  | (11.3 | %)
General and Administrative Expenses |  |  | (755 | ) |  |  | (769 | ) |  |  | (14 | ) |  |  | (1.8 | %) |  |  | (1,534 | ) |  |  | (1,547 | ) |  |  | (13 | ) |  |  | (0.8 | %)
Total Operating Costs and Expenses |  |  | (2,667 | ) |  |  | (2,779 | ) |  |  | (112 | ) |  |  | (4.0 | %) |  |  | (5,273 | ) |  |  | (5,344 | ) |  |  | (71 | ) |  |  | (1.3 | %)
Earnings from Operations |  |  | 483 |  |  |  | 432 |  |  |  | 51 |  |  |  | 11.8 | % |  |  | 756 |  |  |  | 705 |  |  |  | 51 |  |  |  | 7.2 | %
Net Earnings |  | $ | 300 |  |  | $ | 268 |  |  | $ | 32 |  |  |  | 11.9 | % |  | $ | 469 |  |  | $ | 437 |  |  | $ | 32 |  |  |  | 7.3 | %

Three Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Cripple Creek decreased by $0.1 million, or 1.9%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The decrease is primarily due to the eight day road closure of the main highway from Colorado Springs to the casino because of the Waldo Canyon fire during June 2012. The Cripple Creek market decreased by 2%, while the market share for our property in Cripple Creek increased by 1% for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Total operating costs and expenses decreased by $0.1 million, or 4.0%, due to overall management of operating costs for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by $0.1 million, or 11.8%, and net earnings increased by less than $0.1 million, or 11.9%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Six Months Ended June 30, 2012 and 2011
Net operating revenue at our property in Cripple Creek decreased by less than $0.1 million, or 0.3%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The decrease is primarily due to the eight day road closure of the main highway to the casino because of the Waldo Canyon fire during June 2012 offset by an increase in hotel, food and beverage revenue of $0.1 million, or 11.5%, primarily because of an increase in retail prices for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The Cripple Creek market decreased by less than 1%, while the market share for our property in Cripple Creek increased by less than 1% for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
28

Total operating costs and expenses decreased by less than $0.1 million, or 1.3%, due to overall management of operating costs for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
As a result of the foregoing, earnings from operations increased by $0.1 million, or 7.2%, and net earnings increased by less than $0.1 million, or 7.3%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
Cruise Ships & and Other

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
Gaming Revenue |  | $ | 1,481 |  |  | $ | 1,426 |  |  | $ | 55 |  |  |  | 3.9 | % |  | $ | 2,952 |  |  | $ | 2,772 |  |  | $ | 180 |  |  |  | 6.5 | %
Other Revenue |  |  | 175 |  |  |  | 193 |  |  |  | (18 | ) |  |  | (9.3 | %) |  |  | 342 |  |  |  | 383 |  |  |  | (41 | ) |  |  | (10.7 | %)
Net Operating Revenue |  |  | 1,656 |  |  |  | 1,619 |  |  |  | 37 |  |  |  | 2.3 | % |  |  | 3,294 |  |  |  | 3,155 |  |  |  | 139 |  |  |  | 4.4 | %
Gaming Expenses |  |  | (1,262 | ) |  |  | (1,227 | ) |  |  | 35 |  |  |  | 2.9 | % |  |  | (2,505 | ) |  |  | (2,384 | ) |  |  | 121 |  |  |  | 5.1 | %
General and Administrative Expenses |  |  | (191 | ) |  |  | (122 | ) |  |  | 69 |  |  |  | 56.6 | % |  |  | (348 | ) |  |  | (268 | ) |  |  | 80 |  |  |  | 29.9 | %
Total Operating Costs and Expenses |  |  | (1,551 | ) |  |  | (1,457 | ) |  |  | 94 |  |  |  | 6.5 | % |  |  | (3,048 | ) |  |  | (2,871 | ) |  |  | 177 |  |  |  | 6.2 | %
Earnings from Operations |  |  | 105 |  |  |  | 162 |  |  |  | (57 | ) |  |  | (35.2 | %) |  |  | 246 |  |  |  | 284 |  |  |  | (38 | ) |  |  | (13.4 | %)
Net Earnings |  | $ | 91 |  |  | $ | 160 |  |  | $ | (69 | ) |  |  | (43.1 | %) |  | $ | 219 |  |  | $ | 279 |  |  | $ | (60 | ) |  |  | (21.5 | %)

Three Months Ended June 30, 2012 and 2011
Net operating revenue from our ship based casinos and Aruba management agreement increased by less than $0.1 million, or 2.3%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase is primarily due to increased revenue from the Marina and Mein Schiff 2 offset by a decrease in management fee revenue received from the Aruba management agreement.
Total operating costs and expenses increased by $0.1 million, or 6.5%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011. The increase is due to increased staffing and contract labor costs from the Aruba management agreement, an increase in concession and annual fees paid to cruise ship operators and an increase in travel expenses for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
As a result of the foregoing, net earnings decreased by $0.1 million, or 43.1%, for the three months ended June 30, 2012 compared to the three months ended June 30, 2011.
Six Months Ended June 30, 2012 and 2011
Net operating revenue from our ship based casinos and Aruba management agreement increased by $0.1 million, or 4.4%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase is primarily due to increased revenue from the Marina, Mein Schiff 2 and Mariner offset by a decrease in management fee revenue received from the Aruba management agreement.
Total operating costs and expenses increased by $0.2 million, or 6.2%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011. The increase is due to increased staffing and contract labor costs from the Aruba management agreement, an increase in concession and annual fees paid to cruise ship operators and an increase in travel expenses for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
As a result of the foregoing, net earnings decreased by $0.1 million, or 21.5%, for the six months ended June 30, 2012 compared to the six months ended June 30, 2011.
29

Corporate Other

|  | For the three months ended June 30, |  |  |  |  |  | For the six months ended June 30, |  |  |  |
Amounts in thousands |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | $ Change |  |  | % Change |
General and Administrative Expenses |  | $ | (1,332 | ) |  | $ | (1,920 | ) |  | $ | (588 | ) |  |  | (30.6 | %) |  | $ | (2,610 | ) |  | $ | (3,274 | ) |  | $ | (664 | ) |  |  | (20.3 | %)
Total Operating Costs and Expenses |  |  | (1,361 | ) |  |  | (1,984 | ) |  |  | (623 | ) |  |  | (31.4 | %) |  |  | (2,668 | ) |  |  | (3,402 | ) |  |  | (734 | ) |  |  | (21.6 | %)
Losses from Operations |  |  | (1,079 | ) |  |  | (1,603 | ) |  |  | 524 |  |  |  | 32.7 | % |  |  | (2,230 | ) |  |  | (2,929 | ) |  |  | 699 |  |  |  | 23.9 | %
Net Loss |  | $ | (623 | ) |  | $ | (1,070 | ) |  | $ | 447 |  |  |  | 41.8 | % |  | $ | (1,252 | ) |  | $ | (1,924 | ) |  | $ | 672 |  |  |  | 34.9 | %

Three and Six Months Ended June 30, 2012 and 2011
General and administrative expenses for Corporate Other consist primarily of legal and accounting fees, corporate travel expenses, corporate payroll, the amortization of stock based compensation and other expenses not directly related to any of the Company's individual properties. General and administrative expenses decreased by $0.6 million, or 30.6%, and $0.7 million or 20.3%, for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011 due to a reduction in payroll, professional services and stock compensation costs.
Earnings from Equity Investment
We own 33.3% of all shares issued by CPL. Our portion of CPL’s earnings is recorded as earnings from equity investment. We recorded a decrease of $0.1 million and less than $0.1 million, respectively, in earnings from our investment in CPL for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011. The decrease is primarily the result of lower performing properties which were in a start-up phase after recently opening or relocating. We believe that CPL has maintained its market share for the three and six months ended June 30, 2012 compared to the three months ended June 30, 2012.
In July 2011, the co-shareholders in CPL (LOT Polish Airlines and PPL Polish Airports) informed us of their intent to sell their shares in CPL (66.66% of the total shares) to Totalizator Sportowy Group, the state owned Polish national lottery firm. LOT Polish Airlines and PPL Polish Airports requested our consent to their respective conditional sales agreements, which under our CPL agreement was required as a condition to effect the share transfers. As no consensus about the future strategy and operational matters regarding CPL was received from Totalizator Sportowy Group, we were not in a position to provide our consent to the proposed sale transaction. As a result, we have been informed by LOT and PPL that the proposed sale transaction has been terminated.
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Non-Operating Income (Expense)
Non-operating income (expense) for the three and six months ended June 30, 2012 and 2011 was as follows (in thousands):

|  | For the three months ended June 30, |  |  |  |  |  |  |  |  | For the six months ended June 30, |  |  |  |  |  |  |
|  | 2012 |  |  | 2011 |  |  | Change |  |  | % Change |  |  | 2012 |  |  | 2011 |  |  | Change |  |  | % Change |
Interest Income |  | $ | 23 |  |  | $ | 5 |  |  | $ | 18 |  |  |  | 360.0 | % |  | $ | 29 |  |  | $ | 7 |  |  | $ | 22 |  |  |  | 314.3 | %
Interest Expense |  |  | (395 | ) |  |  | (197 | ) |  |  | 198 |  |  |  | 100.5 | % |  |  | (543 | ) |  |  | (443 | ) |  |  | 100 |  |  |  | 22.6 | %
Gains on Foreign Currency Transactions and Other |  |  | 22 |  |  |  | 114 |  |  |  | (92 | ) |  |  | (80.7 | %) |  |  | 17 |  |  |  | 189 |  |  |  | (172 | ) |  |  | (91.0 | %)
Non-Operating Expense |  | $ | (350 | ) |  | $ | (78 | ) |  | $ | 272 |  |  |  | 348.7 | % |  | $ | (497 | ) |  | $ | (247 | ) |  | $ | 250 |  |  |  | 101.2 | %

Interest Income
Interest income is directly related to interest earned on our cash reserves.
Interest expense
The increase in interest expense of $0.2 million and $0.1 million for the three and six months ended June 30, 2012 compared to the three and six months ended June 30, 2011 is due to prepayment penalties related to the early payoff of the Edmonton Mortgage.
Taxes
Our foreign earnings significantly impact our tax rate. The Company’s income tax expense and effective tax rates by jurisdiction are summarized in the tables below:

|  | For the six months |  |  | For the six months |
Amounts in thousands |  | ended June 30, 2012 |  |  | ended June 30, 2011 |
|  | Pre-tax income |  |  | Income tax |  |  | Effective tax rate |  |  | Pre-tax income (loss) |  |  | Income tax |  |  | Effective tax rate |
Canada |  | $ | 1,563 |  |  | $ | 361 |  |  |  | 23.1 | % |  | $ | 1,258 |  |  | $ | 403 |  |  |  | 32.0 | %
United States |  |  | 144 |  |  |  | 122 |  |  |  | 85.1 | % |  |  | (1,056 | ) |  |  | 52 |  |  |  | -4.9 | %
Mauritius |  |  | 147 |  |  |  | 4 |  |  |  | 3.0 | % |  |  | 1,133 |  |  |  | 22 |  |  |  | 1.9 | %
Austria |  |  | 539 |  |  |  | 1 |  |  |  | 0.2 | % |  |  | (222 | ) |  |  | 1 |  |  |  | -0.5 | %
Poland |  |  | 377 |  |  |  | - |  |  |  | 0.0 | % |  |  | 373 |  |  |  | - |  |  |  | 0.0 | %
Total |  | $ | 2,770 |  |  | $ | 489 |  |  |  | 17.7 | % |  | $ | 1,486 |  |  | $ | 478 |  |  |  | 32.2 | %

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The US income tax rate has increased significantly due to a one-time withholding tax payment of $0.1 million related to a Canadian intercompany payable.
The effective tax rates of our foreign properties are impacted by the movement of exchange rates primarily due to loans which are denominated in U.S. dollars. Therefore, foreign currency gains or losses recorded in each property’s local currency do not impact our earnings reported in U.S. dollars. Certain loans of the foreign properties are denominated in U.S. dollars. Therefore, foreign currency gains or losses can significantly impact each property's effective tax rate.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
Our business is capital intensive, and we rely heavily on the ability of our casinos to generate operating cash flow. We use the cash flows that we generate to maintain operations, fund reinvestment in existing properties for both refurbishment and expansion projects, repay third party debt, and pursue additional growth via new development and acquisition opportunities. When necessary and available, we supplement the cash flows generated by our operations with either cash on hand or funds provided by bank borrowings or other debt or equity financing activities.
On May 23, 2012, the Company through its Canadian subsidiaries entered into a CAD 28.0 million ($27.5 million) credit agreement with the Bank of Montreal (the “BMO Credit Agreement”). Proceeds from the BMO Credit Agreement were used to repay the Edmonton Mortgage and will also be used to pursue the development or acquisition of new gaming opportunities and general corporate purposes. The BMO Credit Agreement has a term of five years and is guaranteed by the Company. The BMO Credit Agreement contains a number of financial covenants applicable to the Canadian subsidiaries, in addition to covenants restricting their incurrence of additional debt. As of June 30, 2012, the amount outstanding under the BMO Credit Agreement was $3.6 million and we had approximately $23.8 million available under the BMO Credit Agreement (see Note 4 to condensed consolidated financial statements for further discussion of the BMO Credit Agreement). We were in compliance with all covenants of the BMO Credit Agreement as of June 30, 2012.
Cash and cash equivalents totaled $19.7 million at June 30, 2012, and we had working capital (current assets minus current liabilities) of $11.6 million compared to cash and cash equivalents of $25.2 million and working capital of $6.0 million at December 31, 2011. The decline in cash is primarily due to $9.1 million in the repayment of the Edmonton Mortgage and $0.4 million deferred financing costs paid in relation to the BMO Credit Agreement. In addition, we invested $1.6 million in various capital expenditure projects and had a $0.3 million impact on cash balances due to changes in foreign exchange rates. These declines were offset by $3.6 million received from the BMO Credit Agreement, $2.1 million in cash provided by operating activities and $0.2 million in cash received from the exercise of stock options.
Net cash provided by operating activities was $2.1 million and $2.6 million for the six months ended June 30, 2012 and 2011, respectively. Our cash flows from operations have historically been positive and sufficient to fund ordinary operations. Trends in our operating cash flows tend to follow trends in earnings from operations, excluding non-cash charges. Please refer to the condensed consolidated statements of cash flows and management’s discussion of the results of operations above.
32

Net cash used in investing activities of $1.6 million for the six months ended June 30, 2012 consisted of $0.6 million used to construct the new poker room and remodel the casino entrance in Calgary, $0.4 million used to purchase slot machines and a kiosk at our two Colorado properties, $0.3 million used to replace the carpet and a server at the casino in Edmonton, $0.1 million used to purchase slot machines for the ship-based casinos and $0.2 million used in cumulative additions at our remaining properties.
Net cash used in investing activities of $1.7 million for the six months ended June 30, 2011 consisted of $0.7 million used to purchase slot machines and a kiosk, replace surveillance cameras, and purchase property in Central City, $0.5 million used in building renovations and electrical upgrades in Calgary, $0.2 million used to purchase slot machines and a kiosk in Cripple Creek, $0.1 million used for gaming equipment additions on cruise ship-based casinos and $0.2 million used in cumulative additions at our remaining properties.
Net cash used in financing activities of $5.6 million for the six months ended June 30, 2012 consisted of $9.1 million in the repayment and prepayment of our Edmonton Mortgage and $0.4 million payment of deferred financing costs related to the BMO Credit Agreement offset by $3.6 million cash received from the BMO Credit Agreement and $0.2 million cash received for the exercise of stock options.
Net cash used in financing activities of $2.9 million for the six months ended June 30, 2011 consisted of $3.1 million in the repayment and prepayment of our Edmonton Mortgage debt offset by a $0.2 million cash dividend received from our equity investment in CPL.
Common Stock Repurchase Program
Since 2000, we have had a discretionary program to repurchase our outstanding common stock. In November 2009, we increased the amount available to be repurchased to $15.0 million. We did not repurchase any shares of our common stock during the six months ended June 30, 2012. The total amount remaining under the repurchase program was $14.7 million as of June 30, 2012. The repurchase program has no set expiration or termination date.
Potential Sources of Liquidity, Short-Term Liquidity
Historically, our primary sources of liquidity and capital resources have been cash flow from operations, bank borrowings, sales of existing casino operations and proceeds from the issuance of equity securities.
We expect that the primary source of cash will be from our gaming operations. In addition to the payment of operating costs, expected uses of cash within one year include capital expenditures for our existing properties, interest and principal payments on outstanding debt and potential repurchases of our outstanding common stock. As of June 30, 2012, we had approximately $23.8 million available under the BMO Credit Agreement.
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We believe that our cash at June 30, 2012, as supplemented by cash flows from operations and funds available under the BMO Credit Agreement, will be sufficient to fund our anticipated operating costs, capital expenditures at existing properties and current debt repayment obligations for at least the next 12 months. We will continue to evaluate our planned capital expenditures at each of our existing locations in light of the operating performance of the facilities at such locations. From time to time we expect to have cash needs for the development or purchase of new properties that exceed our current borrowing capacity. If necessary, we may seek to obtain term loans, mortgages or lines of credit with commercial banks or other debt or equity financings to supplement our working capital and investing requirements.
In addition, we expect our U.S. domestic cash resources will be sufficient to fund our U.S. operating activities and cash commitments for investing and financing activities for at least the next 12 months and thereafter for the foreseeable future. While we currently do not have an intent nor foresee a need to repatriate funds, if we require more capital in the U.S. than is generated by our U.S. operations either for operations, capital expenditures or significant discretionary activities such as acquisitions of businesses and share repurchases, we could elect to repatriate earnings from foreign jurisdictions or raise capital in the U.S. through debt or equity issuances, which could have adverse tax consequences as we have not accrued taxes for un-repatriated earnings of our foreign subsidiaries. The determination of the additional deferred taxes that would be provided for undistributed earnings has not been determined because the hypothetical calculation is not practicable.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We had no significant changes in our exposure to market risks from that previously reported in our Annual Report on Form 10-K for the year ended December 31, 2011.
Item 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures – Our management, with the participation of our principal executive officers and principal financial/accounting officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) under the Exchange Act as of the end of the period covered by this report. Based on such evaluation, our Co Chief Executive Officers and Principal Financial Officer have concluded that as of such date, our disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting – There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the six months ended June 30, 2012 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
34

PART II - OTHER INFORMATION
Item 1 A. RISK FACTORS
As of the date of this filing, there have been no material changes or updates to the risk factors previously disclosed in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2011 except as set forth below.
Restrictions under the BMO credit agreement impose covenants that limit our operating flexibility, and a default could have a material adverse effect on us.
In May 2012, the Company’s Canadian subsidiaries entered into the BMO Credit Agreement, which has a term of five years and is guaranteed by the Company. The BMO Credit Agreement contains a number of significant financial covenants applicable to the Canadian subsidiaries, in addition to covenants restricting their incurrence of additional debt. These restrictions will limit the subsidiaries’ ability to obtain future financings to withstand a future downturn in our business or the economy in general, or to otherwise conduct necessary corporate activities. A breach of any covenant in the BMO Credit Agreement would result in an event of default under that agreement after any applicable grace periods. An event of default, if not waived or cured, could cause the lender to accelerate the repayment of all outstanding amounts due under the agreement, foreclosure on the security granted under the agreement and enforce the Company’s obligations under its guarantee, There can be no assurances that we or our subsidiary would be able to obtain a waiver of an event of default or modification of a covenant if necessary, or otherwise obtain alternative sources of funding to repay the obligation if a default occurred. Any such occurrences could have a material adverse effect on the Company.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
In March 2000, our board of directors approved a discretionary program to repurchase up to $5.0 million of our outstanding common stock. In November 2009, our board of directors approved an increase of the amount available to be repurchased under the program to $15.0 million. The repurchase program has no set expiration or termination date and had approximately $14.7 million remaining as of June 30, 2012. There were no repurchases of common stock during the six months ended June 30, 2012.
35

Item 6. EXHIBITS

| (a) Exhibits

3.1 | Certificate of Incorporation of Century Casinos, Inc. is hereby incorporated by reference to the Company’s Proxy Statement for the 1994 Annual Meeting of Stockholders.
3.2 | Amended and Restated Bylaws of Century Casinos, Inc. is hereby incorporated by reference from Exhibit 11.14 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2002.
31.1 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer.
31.2 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer and President.
31.3 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Principal Financial Officer.
32.1 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer.
32.2 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer and President.
32.3 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Principal Financial Officer.
101.INS | XBRL Instance Document**
101.SCH | XBRL Taxonomy Extension Schema Document**
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document**
101.LAB | XBRL Taxonomy Extension Label Linkbase Document**
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document**

** Pursuant to Rule 406T of Regulation S-T, these Interactive Data Files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to the liability under these sections.
SIGNATURES:
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
CENTURY CASINOS, INC.
/s/ Margaret Stapleton
Margaret Stapleton
Vice President and Principal Financial/Accounting Officer
Date: August 8, 2012
36

CENTURY CASINOS, INC.
INDEX TO EXHIBITS

Exhibit No. | Document
3.1 | Certificate of Incorporation of Century Casinos, Inc. is hereby incorporated by reference to the Company’s Proxy Statement for the 1994 Annual Meeting of Stockholders.
3.2 | Amended and Restated Bylaws of Century Casinos, Inc. is hereby incorporated by reference from Exhibit 11.14 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2002.
31.1 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer.
31.2 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer and President.
31.3 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Principal Financial Officer.
32.1 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer.
32.2 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Co Chief Executive Officer and President.
32.3 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Principal Financial Officer.
101.INS | XBRL Instance Document**
101.SCH | XBRL Taxonomy Extension Schema Document**
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document**
101.LAB | XBRL Taxonomy Extension Label Linkbase Document**
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document**

** Pursuant to Rule 406T of Regulation S-T, these Interactive Data Files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to the liability under these sections.
37