CEC Entertainment, Inc. Reports First Quarter Results

Net income in the first quarter of 2006 decreased to $29.2 million from $31.3 million in the same period of 2005. Diluted earnings per share in the first quarter of 2006 were $0.85 per share compared to $0.84 per share in the first quarter of 2005.

Chris Morris, Executive Vice President and Chief Financial Officer stated that, "Total revenues increased 6.0% in the first quarter of 2006 over the same period of the prior year due to new store development and an increase in comparable store sales of 1.2%. During the first quarter of 2006, the Company generated operating cash flow of $60 million, invested $19 million primarily in new and existing stores and repurchased $10 million of its common stock while reducing outstanding borrowings on our credit facility to $105 million at the end of the quarter."

Mr. Morris further added, "Based on current estimates, we expect diluted earnings per share to range from $0.37 to $0.39 per share for the second quarter of 2006 and from $1.94 to $2.02 per share for the year. Expected diluted earnings per share for the year are unchanged from prior guidance."

Richard M. Frank, Chairman and Chief Executive Officer stated that, "The Company remains financially strong which gives us the opportunity to effectively execute our comprehensive business plan and create long-term shareholder value. We are confident in our strategies and have the talented and motivated people to execute them. We believe quality execution of our long-term strategies of improving our product through an aggressive capital plan, enhancing our value and experience for our guest, reinforced with effective advertising, quality new store development, coupled with operational execution and strategically repurchasing Company stock will drive long-term shareholder value."



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