Argosy Gaming Company Reports Second Quarter 2005 Earnings

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. October 14, 2008

CHICAGO, IL, August 8, 2005. Argosy Gaming Company today announced results for the three months ended June 30, 2005. Diluted earnings per share ("EPS") were $0.73 on net income of $21.7 million, as compared to EPS of $0.63 on net income of $18.6 million for the second quarter of 2004. In the second quarter of 2004, Argosy and the City of Lawrenceburg entered into an agreement whereby by making a substantial capital investment at its Lawrenceburg property, Argosy would receive a reduction in its payments to the city by five million dollars annually for ten years. In addition to reflecting the impact of this credit for the relevant quarter, the second quarter of 2004 also includes a $1.25 million credit, or $0.02 per share, for the first quarter of 2004. The results of the second quarter of 2004 also include expenses of approximately $0.02 per share associated with the refinancing of the Company's 10 3/4% notes due 2009. On November 3, 2004, Argosy entered into a definitive merger agreement with Penn National Gaming, Inc. under which all outstanding shares of Argosy are to be acquired for $47 per share. Included in the results of the second quarter of 2005 are $0.02 per share of expenses associated with the proposed merger.

Net revenues for the second quarter of 2005 were $270.9 million, up 6.4% from second quarter 2004 net revenues of $254.6 million. EBITDA (earnings before interest, taxes, depreciation and amortization) increased to $68.7 million for the second quarter 2005, as compared to $66.2 million for the second quarter 2004. At Argosy Casino Baton Rouge, net revenues increased 21%, from $21.5 million to $26.1 million, and EBITDA increased 35%, from $5.0 million to $6.8 million, in the second quarters of 2004 and 2005 respectively, in part due to visitors to the city for a bowling conference that concluded July 4. In Sioux City, net revenues improved 24% and EBITDA increased 27% from the second quarter of 2004 to the same period of 2005 due to the addition of the renovated boat formally used at the Company's Riverside property. Net revenues for the property were $13.7 million and EBITDA was $4.3 million in the second quarter of 2005, up from net revenues of $11.0 million and EBITDA of $3.4 million in the second quarter of 2004. The Company's EBITDA margin (EBITDA as a percent of net revenues) was 25.4% for the second quarter of 2005, as compared to 26.0% for the same quarter in 2004.

Interest expense for the second quarter of 2005 was $14.3 million as compared to $16.6 million for the second quarter of 2004. The reduction in interest expense was predominantly the result of a lower effective interest rate for the Company following a refinancing of the Company's $675 million Revolving Credit Facility and Term Loan B in September of 2004 and a lower outstanding balance on the Term Loan B.

For the six months ended June 30, 2005, net income was $43.0 million ($1.44 EPS) on net revenues of $541.9 million, compared to net income of $22.5 million ($0.76 EPS) on net revenues of $518.7 million for the same period in 2004. For the six-month period ended June 30, 2004, results were negatively impacted by $0.52 per share in expenses related to the refinancing of the Company's 10 3/4% notes. Included in the six-month period ended June 30, 2005 were expenses related to the merger with Penn that negatively impacted results for the six months by $0.07.

Argosy reported that debt decreased from $803.2 million as of March 31, 2005 to $764.6 million as of June 30, 2005. The Company spent $9.4 million in maintenance capital in the second quarter of 2005, for a total of $17.7 million for the first six months of the year. Project capital for the second quarter of 2005 was $13.5 million, predominantly for the work on the replacement garage and new hotel at the Company's Riverside property.

Pursuant to the merger agreement between Argosy and Penn, Argosy has agreed not to provide any guidance concerning its expected earnings or other performance. The transaction is still subject to certain regulatory approvals, and is expected to close in the third quarter of 2005.

Argosy Gaming Company is a leading owner and operator of casinos and related entertainment and hotel facilities in the midwestern and southern United States. Argosy owns and operates the Argosy Casino-Alton in Illinois, serving the St. Louis metropolitan market; the Argosy Casino-Riverside in Missouri, serving the greater Kansas City metropolitan market; the Argosy Casino-Baton Rouge in Louisiana; the Argosy Casino-Sioux City in Iowa; the Argosy Casino-Lawrenceburg in Indiana, serving the Cincinnati and Dayton metropolitan markets; and the Empress Casino Joliet in Illinois serving the greater Chicagoland market.

This press release contains statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as the Company or its management "believes," "anticipates," "expects," "forecasts," "estimates," "foresees," or other words or phrases of similar import. Similarly, such statements herein that describe the Company's business outlook, objectives, strategy, intentions or goals are also forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected.