DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This report contains statements that we believe are, or may be considered to be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this report regarding the prospects of our industry or our prospects, plans, financial position or business strategy, may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking words such as "may," "will," "expect," "intend," "estimate," "foresee," "project," "anticipate," "believe," "plans," "forecasts," "continue" or "could" or the negatives of these terms or variations of them or similar terms. Furthermore, such forward-looking statements may be included in various filings that we make with the SEC or press releases or oral statements made by or with the approval of one of our authorized executive officers. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that these expectations will prove to be correct. These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. Readers are cautioned not to place undue reliance on any forward-looking statements contained herein, which reflect management's opinions only as of the date hereof. Except as required by law, we undertake no obligation to revise or publicly release the results of any revision to any forward-looking statements. You are advised, however, to consult any additional disclosures we make in our reports to the SEC. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this report.

For a more complete description of the risks that may affect our business, see our Annual Report on Form 10-K for the year ended April 29, 2012.

Executive Overview

We are a developer, owner and operator of branded gaming facilities and related lodging and entertainment facilities in regional markets in the United States. We have intentionally sought geographic diversity to limit the risks caused by weather, regional economic difficulties and local gaming authorities and regulations. We currently operate casinos in Mississippi, Louisiana, Missouri, Iowa, Colorado and Florida. We also operate a harness racing track at our casino in Florida.

Our operating results for the periods presented have been affected, both positively and negatively, by current economic conditions and several other factors discussed in detail below. Our historical operating results may not be indicative of our future results of operations because of these factors and the changing competitive landscape in each of our markets, as well as by factors discussed elsewhere herein. This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our Annual Report on Form 10-K for the year ended April 29, 2012 and by giving consideration to the following:

Items Impacting Income (Loss) from Continuing Operations- Significant items impacting our income (loss) from continuing operations during the fiscal quarters ended October 28, 2012, and October 23, 2011 are as follows:

Construction Distruption - During fiscal 2013 we have been remodeling our main hotel tower at our Lake Charles property and the casino at our Vicksburg property. As a result, certain areas of these properties may not be accessable to our customers during the construction period resulting in a loss of revenues.

Increased Competition - From time to time, new or expanded facilities by our competitors impact our results. For example, competition from a new casino in Kansas opened during February 2012 negatively

impacted our Kansas City casino and expansion by a competitor in February 2012 has negatively impacted our Pompano casino. Expansions by Arkansas based competitors have negatively impacted our Lula property.

Flooding-Due to flooding along the Mississippi River, five of our properties were closed for portions of the six months ended October 23, 2011. A summary of the closure dates and subsequent reopening is as follows:

                                                                Number Days
                            Closing Date     Reopening Date       Closed
Davenport, Iowa            April 15, 2011      May 1, 2011               15 (A)
Caruthersville, Missouri      May 1, 2011     May 13, 2011               12
Lula, Mississippi             May 3, 2011     June 3, 2011               31
                                            September 2, 2011            91 (B)
Natchez, Mississippi          May 7, 2011     June 17, 2011              41
Vicksburg, Mississippi       May 11, 2011     May 27, 2011               16

(B) The second casino barge reopened on September 2, 2011 after flood damage was remediated.

Income Tax Provision(Benefit) - During the fourth quarter of fiscal 2012 we recorded a valuation allowance reducing our deferred tax assets, as a result of evaluating the expected net realizable value of our deferred tax assets, including our net operating loss carry forwards. Our actual effective rate will fluctuate based upon the amount of our pretax book income, permanent differences and other items, including fluctuations in valuation allowances, used in the calculation of our income tax benefit.

Discontinued Operations

Sale of Biloxi -During March 2012, we entered into a definitive agreement to sell our subsidiary, which owns and operates our casino and hotel operations in Biloxi for $45 million subject to regulatory approval and other customary closing conditions. During the three months ended October 28, 2012, we recorded a $1.5 million valuation allowance reflecting a credit against the purchase price to satisfy our obligation to repair the property after Hurricane Isaac, as required by the purchase agreement. This transaction was completed on November 29, 2012.

Revenues and Operating Expenses

Revenues and operating expenses for the three and six months ended October 28, 2012 and October 23, 2011 are as follows:

                                               Three Months Ended
                                          October 28,      October 23,                     Percentage
(in thousands)                               2012             2011           Variance       Variance
Revenues:
Casino                                   $     234,648    $     239,707    $     (5,059 )        -2.1 %
Rooms                                            8,328            8,419             (91 )        -1.1 %
Food, beverage, pari-mutuel and other           30,437           30,723            (286 )        -0.9 %
Insurance recoveries                                 -              111            (111 )      -100.0 %
Gross revenues                                 273,413          278,960          (5,547 )        -2.0 %
Less promotional allowances                    (50,206 )        (47,534 )        (2,672 )         5.6 %
Net revenues                                   223,207          231,426          (8,219 )        -3.6 %

Operating expenses:
Casino                                          36,802           38,172          (1,370 )        -3.6 %
Gaming taxes                                    58,619           59,435            (816 )        -1.4 %
Rooms                                            1,781            1,929            (148 )        -7.7 %
Food, beverage, pari-mutuel and other            9,217            9,590            (373 )        -3.9 %
Marine and facilities                           13,888           14,933          (1,045 )        -7.0 %
Marketing and administrative                    56,464           58,594          (2,130 )        -3.6 %
Corporate and development                       10,777            9,327           1,450          15.5 %
Preopening expense                               2,654               27           2,627           N/M
Depreciation and amortization                   16,850           19,646          (2,796 )       -14.2 %
Total operating expenses                 $     207,052    $     211,653          (4,601 )        -2.2 %




                                                Six Months Ended
                                          October 28,      October 23,                     Percentage
(in thousands)                               2012             2011           Variance       Variance
Revenues:
Casino                                   $     484,917    $     474,934    $      9,983           2.1 %
Rooms                                           16,958           16,891              67           0.4 %
Food, beverage, pari-mutuel and other           63,243           60,350           2,893           4.8 %
Insurance recoveries                                 -              111            (111 )      -100.0 %
Gross revenues                                 565,118          552,286          12,832           2.3 %
Less promotional allowances                   (106,088 )        (93,256 )       (12,832 )        13.8 %
Net revenues                                   459,030          459,030               -           0.0 %

Operating expenses:
Casino                                          75,298           74,143           1,155           1.6 %
Gaming taxes                                   120,247          118,952           1,295           1.1 %
Rooms                                            3,554            3,848            (294 )        -7.6 %
Food, beverage, pari-mutuel and other           19,321           19,543            (222 )        -1.1 %
Marine and facilities                           27,588           29,059          (1,471 )        -5.1 %
Marketing and administrative                   114,420          115,541          (1,121 )        -1.0 %
Corporate and development                       19,250           21,593          (2,343 )       -10.9 %
Preopening expense                               3,341               63           3,278           N/M
Depreciation and amortization                   33,672           38,822          (5,150 )       -13.3 %
Total operating expenses                 $     416,691    $     421,564          (4,873 )        -1.2 %

Casino - Casino revenues decreased $5.1 million, or 2.1%, for the three months ended October 28, 2012, as compared to the same period in fiscal 2012. Casino revenues were impacted by construction disruption at our Lake Charles and Vicksburg properties, which had decreases of $1.5 million and $1.6 million, respectively, as compared to the same period in fiscal 2012. Our Lula and Kansas City properties had decreased casino revenues of $1.4 million and $1.3 million, respectively, as a result of increased competition. In addition casino revenues increased $1.1 million at our Pompano property and $1.0 million at our Waterloo property.

Casino operating expenses decreased $1.4 million, or 3.6%, for the three months ended October 28, 2012, as compared to the same period in the prior fiscal year, commensurate with casino revenues.

Casino revenues increased $10.0 million, or 2.1%, for the six months ended October 28, 2012, as compared to the same period in fiscal 2012. Casino revenues for our properties closed due to flooding in fiscal 2012 increased $10.3 million, or 10.9%. Casino revenues increased at our Pompano and Waterloo properties of $2.2 million and $2.0 million, respectively, offset by decreases in casino revenue at our Lake Charles and Kansas City properties of $1.9 million and $2.1 million, respectively.

Casino operating expenses increased $1.2 million, or 1.6%, for the six months ended October 28, 2012, as compared to the same period in the prior fiscal year. Casino operating expenses for our properties closed due to flooding in fiscal 2012 increased $1.3 million, or 8.5%, for the six months ended October 28, 2012, as compared to the same period in fiscal 2012.

Gaming Taxes - State and local gaming taxes decreased $0.8 million, or 1.4%, and increased $1.2 million or 1.1%, for the three and six months ended October 28, 2012, respectively, as compared to the same period in the prior fiscal year consistent with the changes in casino revenues.

Rooms - Rooms revenue and expense remained stable for the three and six months ended October 28, 2012, as compared to the same period in the prior fiscal year.

Food, Beverage, Pari-Mutuel and Other - Food, beverage, pari-mutuel and other revenues decreased $0.3 million, or 0.9%, for the three months ended October 28, 2012, as compared to the same period in the prior fiscal year.

Food, beverage, pari-mutuel and other expenses decreased $0.4 million, or 3.9%, for the three months ended October 28, 2012, as compared to the same period in the prior fiscal year.

Food, beverage, pari-mutuel and other revenues increased $2.9 million, or 4.8%, for the six months ended October 28, 2012, as compared to the same period in the prior fiscal year. Food, beverage, pari-mutuel and other revenue for our properties closed due to flooding in fiscal 2012 increased $1.3 million, or 12.9% for the six months ended October 28, 2012, as compared to the same period in fiscal 2012.

Food, beverage, pari-mutuel and other expenses decreased $0.2 million, or 1.1%, for the six months ended October 28, 2012, as compared to the same period in the prior fiscal year. Food, beverage, pari-mutuel and other expense for our properties closed due to flooding in fiscal 2012 increased $0.2 million, or 7.2% for the six months ended October 28, 2012, as compared to the same period in fiscal 2012.

Promotional Allowances - Promotional allowances increased $2.7 million, or 5.6%, for the three months ended October 28, 2012, as compared to the same period in the prior fiscal year.

Promotional allowances increased $12.8 million, or 13.8%, for the six months ended October 28, 2012, as compared to the same period in the prior fiscal year. Promotional allowances for our properties closed due to flooding increased $5.2 million, or 23.6%, for the six months ended October 28, 2012, as compared to the same period in fiscal 2012. During the first quarter of fiscal 2013, we implemented our new customer loyalty program,

Fan ClubŪ, at five of our properties. As of October 28, 2012, Fan ClubŪ has been implemented at nine of our properties, with roll-out to remaining properties expected by the end of the fiscal year. Fan ClubŪ allows customers greater choice in how to use their points for cash, free play or food. Implementation of Fan ClubŪ as well as changes to our promotions also resulted in increased promotional costs.

Marine and Facilities - Marine and facilities expenses decreased $1.0 million, or 7.0%, for the three months ended October 28, 2012 as compared to the same period in the prior fiscal year, primarily reflecting cost savings from operating one vessel in Lake Charles.

Marine and facilities expenses decreased $1.5 million, or 5.1%, for the six months ended October 28, 2012 as compared to the same period in the prior fiscal year. Marine and facilities expense for our properties not closed due to flooding decreased $2.5 million, or 10.7% for the six months ended October 28, 2012, as compared to the same period in fiscal 2012 primarily reflecting cost savings from operating one vessel in Lake Charles and decreased spending for repairs and maintenance.

Marketing and Administrative - Marketing and administrative expenses decreased $2.1 million, or 3.6%, for the three months ended October 28, 2012 as compared to the same period in the prior fiscal year primarily reflecting year our year reductions in insurance costs.

Marketing and administrative expenses decreased $1.1 million, or 1.0%, for the six months ended October 28, 2012 as compared to the same period in the prior fiscal year. Marketing and administrative expenses for our properties not closed due to flooding decreased $4.2 million, or 4.8% for the six months ended October 28, 2012, as compared to the same period in fiscal 2012 reflecting reductions in our insurance and, repairs and maintenance expenses.

Corporate and Development - During the three months ended October 28, 2012, our corporate and development expenses were $10.8 million compared to $9.3 million for the three months ended October 23, 2011. The increase is primarily the result of debt refinancing costs of $1.5 million and increased legal expenses of $1.0 million in the quarter, offset by lower insurance costs and stock compensation expenses. During the six months ended October 28, 2012, our corporate and development expenses decreased $2.3 million compared to the same period in the prior fiscal year, primarily due to decreased insurance costs of $1.6 million, decreased stock based compensation expense of $1.4 million and an unfavorable franchise tax settlement of $0.5 million in the prior year, offset by debt refinancing expenses in the current year of $1.5 million and increased legal expense of $1.0 million.

Depreciation and Amortization - Depreciation and amortization expense for the three and six months ended October 28, 2012 decreased $2.8 million and $5.2 million, respectively, as compared to the same period in the prior fiscal year, primarily due to certain assets becoming fully depreciated.

Other Income (Expense) and Income Taxes



Interest expense, interest income, derivative income and income tax (provision)
benefit for the three months ended October 28, 2012 and October 23, 2011 are as
follows:



                                      Three Months Ended
                                  October 28,     October 23,                 Percentage
(in thousands)                       2012            2011         Variance     Variance

Interest expense                 $     (21,985 ) $     (21,877 ) $     (108 )        0.5 %
Interest income                            131             192          (61 )      -31.8 %
Derivative income                          176             260          (84 )      -32.3 %
Income tax (provision) benefit           1,182             622          560         90.0 %

                                  October 28,     October 23,                 Percentage
(in thousands)                       2012            2011         Variance     Variance

Interest expense                 $     (42,416 ) $     (43,702 ) $    1,286         -2.9 %
Interest income                            306             435         (129 )      -29.7 %
Derivative income                          310              29          281        969.0 %
Income tax (provision) benefit            (136 )         2,183       (2,319 )     -106.2 %

Interest Expense - Interest expense remained relatively flat for the three months ended October 28, 2012, as compared to the same period in the prior fiscal year. This change primarily reflects the write-off of deferred financing costs of $1.0 million, offset by the capitalization of interest associated with the construction of our new Cape Girardeau casino. Interest expense decreased $1.3 million for the six months ended October 28, 2012, as compared to the same period in the prior fiscal year. This decrease primarily reflects the capitalization of interest associated with the construction of our new Cape Girardeau casino.

Liquidity and Capital Resources

Cash Flows from Operating Activities - During the six months ended October 28, 2012, we generated $56.5 million in cash flows from operating activities compared to generating $33.4 million during the six months ended October 23, 2011. The year over year increase in cash flows from operating activities is primarily the result of five of our properties being closed for a portion of fiscal 2012 due to flooding. Additionally, during the six months ended October 28, 2012, we collected insurance receivables of $7.5 million related to flooding during fiscal 2012.

Cash Flows used in Investing Activities - During the six months ended October 28, 2012, we used $95.0 million for investing activities compared to using $34.2 million during the six months ended October 23, 2011. Significant investing activities for the six months ended October 28, 2012 included capital expenditures of $89.5 million, of which $60.2 million related to Cape Girardeau. Significant investing activities for the six months ended October 23, 2011 included capital expenditures of $34.3 million, of which $12.4 million related to Cape Girardeau and Nemacolin.

Cash Flows used in Financing Activities - During the six months ended October 28, 2012, our net cash flows provided by financing activities were $19.5 million, including $38.0 million in borrowings under the revolving line of credit, debt repayments of $10.1 million and payments for deferred financing costs of $8.4 million. During the six months ended October 23, 2011, our net cash flows used in financing activities were used primarily to repay our outstanding long-term debt of $7.8 million.

Availability of Cash and Additional Capital - At October 28, 2012, we had cash and cash equivalents of $75.5 million and marketable securities of $24.3 million. As of October 28, 2012, we had $38.0 million in outstanding borrowings under our revolving credit and $492.5 million in term loans outstanding under the senior secured credit facility. Our line of credit availability at October 28, 2012 was approximately $199 million as limited by our senior secured leverage ratio.

On August 7, 2012, we completed the issuance and sale of $350 million of 8.875% Senior Subordinated Notes due 2020 in a private offering. We received net proceeds of $343 million for this issuance after deducting underwriting fees. We repurchased and retired our $357.3 million 7% Senior Subordinated Notes due 2014 with proceeds from the issuance of the New Subordinated Notes and cash on hand.

Following completion of the issuance of our New Subordinated Notes and the retirement of the 7% Subordinated Notes due 2014, the maturities of our Credit Facility are exended to March 25, 2016 and March 25, 2017 for the revolving line of credit and term loans, respectively, based on the terms of the Credit Facility.

In November 2012, we amended certain provisions of the Credit Facility to; 1) give us more flexibility to incur additional indebtedness, in certain circumstances, 2) increase our flexibility to incur asset sales, 3) modify our maximum allowed leverage covenant and 4) allow for the annualization of EBITDA during the first year of operations on new build projects.

Capital Expenditures and Development Activities-As part of our business development activities, historically we have entered into agreements which have resulted in the acquisition or development of businesses or assets. These business development efforts and related agreements typically require the expenditure of cash, which may be significant. The amount and timing of our cash expenditures relating to development activities may vary based upon our evaluation of current and future development opportunities, our financial condition and the condition of the financing markets. Our development activities are subject to a variety of factors including but not limited to: obtaining permits, licenses and approvals from appropriate regulatory and other agencies, legislative changes and, in certain circumstances, negotiating acceptable leases.

We opened our Isle Casino Cape Girardeau casino development on October 30, 2012. We have incurred cash-based capital expenditures of $109.0 million, including capitalized interest, through October 28, 2012. We expect to incur the majority of the remaining capital expenditures related to this project on or before December 31, 2012, with total project costs estimated at $135 million.

On August 20, 2012, the Pennsylvania Supreme Court affirmed the decision of the Pennsylvania Gaming Control Board to award a Category 3 resort gaming license to the Nemacolin Woodlands Resort in Farmington, Pennsylvania. We have a development and management agreement with Nemacolin to build and operate a casino. We currently estimate the cost of the project to be approximately $57 million to $60 million and expect to open Lady Luck Nemacolin during summery 2013. To date, we have incurred capital expenditures, including capitalized interest, of $1.4 million.

Historically, we have made significant investments in property and equipment and expect that our operations will continue to demand ongoing investments to keep our properties competitive. During the six months ended October 28, 2012, we have incurred capital expenditures at our existing properties of $20.3 million. For the balance of the current fiscal year, we estimate additional capital expenditures at our existing properties to be approximately $80 million to $90 million, including maintenance capital, final costs in Cape Girardeau and construction costs in Nemacolin of approximately $20 million to $30 million. Currently in process are several capital projects primarily focused on refreshing our hotel room inventory as well as additional improvements to our Black Hawk and Lake Charles properties, and rebranding our of Vicksburg property to a Lady Luck. Additionally we expect to make several other improvements to our properties including additional Farmers Pick buffets and other food and beverage outlets as well as ongoing maintenance capital. The timing, completion and amount of additional capital projects will be subject to improvement of economic and local market conditions, cash flows from our continuing operations and borrowing availability under our Credit Facility.

Typically, we have funded our daily operations through net cash provided by operating activities and our significant capital expenditures through operating cash flow and debt financing. While we believe that cash on hand, cash flow from operations, and available borrowings under our Credit Facility will be sufficient to support our working capital needs, planned capital expenditures and debt service requirements for the foreseeable future, there is no assurance that these sources will in fact provide adequate funding for our planned and necessary expenditures or that the level of our capital investments will be sufficient to allow us to remain competitive in our existing markets.

We are highly leveraged and may be unable to obtain additional debt or equity financing on acceptable terms if our current sources of liquidity are not sufficient or if we fail to stay in compliance with the covenants of our senior secured credit facility. 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.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with U.S. . . .