our STRATEGY in ACTION RESTYLING our BRANDS and BUSINESS Isle of Capri Casinos, Inc. 2011 Annual Report CORPORATE OVERVIEW Founded in 1992, Isle of Capri Casinos, Inc. is dedicated to providing our customers with an exceptional gaming and entertainment experience at each of our 15 casino properties. The company owns and operates casinos in Biloxi, Lula, Natchez and Vicksburg, Missis- sippi; Lake Charles, Louisiana; Bettendorf, Davenport, Marquette and Waterloo, Iowa; Boonville, Caruthersville and Kansas City, Missouri; two casinos in Black Hawk, Colo- rado; and a casino and harness-racing track in Pompano Beach, Florida – with an excit- ing new gaming facility under development in Cape Girardeau, Missouri. Isle of Capri is traded on the NASDAQ stock exchange under the ticker symbol ISLE. Isle of Capri Casinos, Inc. 2011 Annual Report – page 1 EXECUTIVE CHAIRMAN’s LETTER to SHAREHOLDERS When Isle of Capri’s new management team came putting the customer first; and we continue to aboard three years ago, we set out to transform the implement a strategy designed to simplify our company by building a stronger business model property portfolio to two distinct brands with based on fundamental operating principles and different business models and distinct character. fiscal discipline. We developed and implemented a comprehensive plan to strengthen operations by Exceptional Leadership exceeding customer expectations, and aggressively None of this would be possible without an incredible moved to align operating strategy with the evolving team of experienced gaming professionals led by needs of customers to forge a solid platform for Virginia McDowell, who was recently appointed sustainable success. president and chief executive officer of our company. With this well-deserved promotion, she Platform for Success becomes the only female CEO among the top 10 The key components of this plan comprised five gaming companies. strategic initiatives: fortifying our financial discipline, building a stronger operating company, I have worked with Virginia for over 25 years at elevating the customer experience, leveraging our a number of major gaming companies where she human capital and repositioning our brands. gained proven expertise in our business. After joining Isle in mid-2007, she led our operations As noted throughout this report, we have made through sweeping improvements, drawing on her significant and measureable progress in achieving leadership experience in the areas of operations, each of our goals. Today, we are stronger operationally marketing, information technology, business and financially; we are closer to our customers and development, communications and branding. are building lasting relationships with our most Virginia’s energetic leadership and vision will profitable players; we foster a customer-focused unquestionably lead Isle of Capri forward to culture, training and rewarding our employees for continued future success. Sincerely yours, JAMES B. PERRY EXECUTIVE CHAIRMAN of the BOARD August 19, 2011 Isle of Capri Casinos, Inc. 2011 Annual Report – page 2 PRESIDENT and CEO’s LETTER to SHAREHOLDERS Isle of Capri Casinos has not been idle while waiting for the economy to recover. Instead, we’ve achieved significant progress in our strategic objectives in a year boldly underscored by major accomplishments. Achieving Progress. During fiscal 2011, we acquired Net income for the year improved to $4.5 million our 15th casino property in Vicksburg, Mississippi. compared to a loss of $3.3 million the year before. Additionally, we were selected to receive the Property EBITDA climbed $14.3 million, or 6.8 final remaining gaming licenses in Missouri and percent, to $225.9 million and property operating Pennsylvania, in Cape Girardeau and at Nemacolin margins rose 133 basis points to 22.5 percent, both Woodlands Resort, respectively. Construction is before the effects of one-time items in fiscal 2010. under way in Cape Girardeau with an anticipated opening in late 2012. We succeeded in growing Strengthening Our Balance Sheet revenue, EBITDA and operating margins at more During the last half of fiscal 2011, we made than half of our properties. We also significantly significant progress toward our continuing goal improved our capital structure with successful of improving the strength of our balance sheet equity and bond offerings, and a refinanced and capital position, and fortifying our financial credit facility. foundation. Through successful equity and bond offerings and a new bank facility, we are solidly At the same time, we introduced new positioned for the future with increased financial entertainment and dining options across our flexibility to benefit our streamlined cost structure, portfolio. We streamlined our marketing to benefit to pursue new and organic growth opportunities, from the synergy created by more centralized and to drive shareholder value. promotional and branding programs, and we converted approximately 2,500 slot machines to a Bolstering Financial Flexibility. In January 2011, state-of-the-art slot-system technology. we completed a public offering of 5.3 million shares of its common stock at a price of $9.75, Fiscal 2011 Financial Results raising $51.2 million in new equity. We used the For the fiscal year ended April 24, 2011, Isle of net proceeds to pay down borrowings outstanding Capri Casinos’ consolidated net revenues increased under our revolving line of credit and for general $5.2 million over the prior year, to $1.005 billion. corporate purposes. Isle of Capri Casinos, Inc. 2011 Annual Report – page 3 In March 2011, we issued $300 million in relationships, improving our customer courtesy aggregate principal amount of 7.750 percent senior scores and continuing to build our brand portfolio. notes due 2019. We used the net proceeds from the offering to repay term loans outstanding under our Faced with a slow-to-recover economy, credit facility. we continue to seek ways to streamline our operations and right-size our business. Looking Also in March, we successfully refinanced at every area of our business, we successfully our senior secured credit facility by entering into decreased spending at the property level by $45 an amended and restated senior secured credit million over the past three years, including a agreement. The new credit facility consists of a $300 reduction of $13 million in fiscal 2011 (results million revolving line of credit and a $500 million exclude Vicksburg). term loan, which mature in November 2013, and if we refinance our 7 percent senior subordinated notes prior to that date, the revolving line of credit matures in March 2016 and term loan matures in March 2017. We COMPLETED a PUBLIC OFFERING, Becoming a Stronger Operator raising As Isle approaches its 20th year in the gaming $51.2 MILLION industry, we have a clear understanding of who in we are and what we do best. We operate casinos NEW EQUITY. in regional markets with properties focused on an environment that is clean, safe, friendly and fun and one that delivers value to our customers. Today, we own and operate a geographically Delivering value to our customers, we diverse portfolio of casino properties in six states: converted restaurants at several properties to the Mississippi, Louisiana, Missouri, Iowa, Colorado popular Otis & Henry’s Bar & Grill concept, and Florida. These operations boast a combined which focuses on freshly prepared comfort food total of approximately 15,000 slot machines, 370 in a casual and comfortable dining setting. table games and 3,100 hotel rooms. Additionally, several properties also introduced Lone Wolf bar as an entertainment hub, creating Two-Brand Strategy. We remain committed to our energy and excitement by featuring local bands, two-brand strategy – with Isle properties typically up-to-the-minute sports and great bar food. We amenity-driven, drawing customers from a regional continue to fine tune our food offerings and look area in larger markets with potential for expansion, forward to launching the Farmer’s Buffet concept and Lady Luck properties predominately appealing in fiscal 2012. Customer response to the changes to local customers in smaller markets with less has been excellent, and cover counts have increased expansion potential. significantly in response to the value proposition and new menu items. To date, we have converted three properties to the Lady Luck brand and plan to introduce Building Lasting Relationships the brand in additional markets over the next Foremost among the key initiatives designed few years. to transform our company is developing and strengthening solid relationships with customers Operational Improvements. Throughout the year, and employees. To get closer to our customers and we continued our focus on implementing cost- understand them better, we use a broad range of containment initiatives and operating more high-tech and high-touch tools, from sophisticated efficiently while creating value for our customers. data gathering, to social media like Facebook and We remain committed to forging strong customer Twitter, to personal contact and interaction. Isle of Capri Casinos, Inc. 2011 Annual Report – page 4 Utilizing Research. Operating in the entertainment baseline score of 60 percent to 91.6 percent at the business, we offer customers a unique experience, and end of fiscal 2011. Our goal is to achieve a corporate our goal is to make sure they enjoy that experience. standard of 95 percent with a 15 percent advantage We use targeted research to drive satisfaction, and over market competition.