Nevada Gold Reports Q1 Results

Nevada Gold & Casinos, Inc. (AMEX:UWN) today announced financial results for the first quarter ended July 24, 2005.

For the first quarter of fiscal 2006, revenues increased to $3.8 million compared to $1.4 million in the first quarter ended June 30, 2005. The revenue increase was primarily due to $1.8 million in casino revenues and $501,000 in food and beverage revenues recorded during the first quarter from the Colorado Grande Casino-Cripple Creek, which the company acquired during April 2005. In addition, revenues increased as a result of a $567,000 or 42% increase in credit enhancement fees from the River Rock project.

Operating expenses increased to $3.2 million from $1.2 million primarily as a result of the inclusion of the casino operations, food and beverage, marketing and administrative, and facility expenses from the Colorado Grande Casino-Cripple Creek and higher corporate expenses. The Company experienced higher corporate expenses due to its pursuit of additional gaming opportunities and expanded casino operations.

The Company's equity in earnings from Isle of Capri-Black Hawk (IC-BH), the Company's joint venture with Isle of Capri Casinos, Inc., was $2.1 million for the first quarter ended July 24, 2005, compared to $2.4 million for the first quarter of fiscal 2005. IC-BH's first quarter adjusted earnings before interest, taxes, depreciation and amortization (``EBITDA'), was $12.3 million in the first quarter of fiscal 2006 compared to $10.7 million in the first quarter of fiscal 2005. A reconciliation of EBITDA to operating income is provided in the following financial tables.

Net income for the first quarter of fiscal 2006 was $1.5 million compared to $1.7 million in the first quarter of fiscal 2005. Net income per diluted common share was $0.12, compared to $0.12 in the prior year period. Diluted weighted average common shares outstanding in the first quarter were 14.0 million compared to 15.4 million in the prior year period. During the first quarter of fiscal 2006, the Company repurchased 511,500 shares of the company's common stock in the open market.

H. Thomas Winn, Chairman, President and CEO of Nevada Gold & Casinos, Inc. commented, ``Our first quarter results reflect our ongoing efforts to invest in new and existing projects to drive long-term earnings. We remain focused on redeploying our capital into new opportunities including acquiring additional gaming assets or through the repurchase of our shares in an effort to continue building shareholder value.'

Recent Events

On August 24, 2005 the Company entered into an agreement to acquire a 50% equity interest in a new limited liability company with the remaining 50% owned by Tioga Downs Racetrack, LLC (``Tioga Downs'). Tioga Downs is jointly-owned by affiliates of Jeffrey Gural and Trackpower, Inc. (OTC BB:TPWR.OB). The new company will develop Downs Tioga Downs Racetrack, located just west of Binghamton in Nichols, New York, as well as pursue acquisition of Vernon Downs Racetrack. Vernon Downs, located just east of Syracuse in Vernon, New York, is currently operating under the chapter 11 bankruptcy protection of its parent company Mid-State Raceway, Inc.

Construction of a $35.0 million redevelopment of Tioga Downs Racetrack recently began. Tioga Downs Racetrack will operate as a harness racetrack and offer approximately 750 video lottery terminal machines (VLTs) to its gaming and racing customers. A newly-constructed 90,000-square-foot grandstand will house a 19,000-sq.-ft. casino floor. Vernon Downs includes a harness track, 175-all suite hotel and 34,000-sq.-ft. gaming facility that will offer 1,000 VLT machines to its customers. Racing and gaming operations are subject to the receipt of certain regulatory approvals, including the receipt of VLT licenses from the New York State Lottery.

Concurrent with the completion of the transaction, Nevada Gold will also enter into a management agreement that will provide for the management of the VLT facilities at Tioga Downs and if acquired, Vernon Downs. Tioga Downs will oversee the management of the racing operations and will work with Nevada Gold to ensure the proper coordination of the racing and gaming operations. Nevada Gold will make an initial capital contribution of approximately $5 million on the Tioga project. If successful in the Vernon Downs acquisition, the capital contribution will increase to $9 million for both projects.

Financial Presentation

In presenting these results, the Company noted that on June 6, 2005, it changed its fiscal year to the last Sunday in April rather than March 31. The company will include information for this transition period from April 1 to April 24, 2005 in its Form 10-Q filed with the Securities and Exchange Commission. References in this press release to the first quarter of fiscal year 2006 refer to the three months ending July 24, 2005, and references to the first quarter of fiscal year 2005 refer to the three months ending June 30, 2004. Management believes that the three months ended June 30, 2004 provides a meaningful comparison to the first quarter of fiscal year 2006. Due to the changing of the fiscal year, the Company will file an extension of the 10-Q ending July 24, 2005. The Company now intends to file the 10-Q on Wednesday, Sept. 7, 2005.