SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C., 20549
FORM 10-Q xQuarterly Report under Section 13 or 15(d)
of the Securities Exchange Act of 1934For the quarterly period
ended March 31, 2001.or ̈Transition Report Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File
Number 1-11853 ARGOSY GAMING COMPANY(Exact name of Registrant as
Specified in its Charter) Delaware
  37-1304247(State or other jurisdiction of
  incorporation)
  (I.R.S. Employer Identification
  No.)219 Piasa Street
  Alton, Illinois
  62002(Address of Registrant's
  principal executive offices)
  (zip code)(618) 474-7500(Registrants' telephone number,
  including area code)
 Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.     YesxNo ̈ APPLICABLE ONLY TO
CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the
issuer's classes of common stock as of the latest practicable date:  28,506,603 shares of Common Stock, $.01 par
value per share, as of  May 4, 2001.   ARGOSY
GAMING COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS(In Thousands, Except Share and Per Share
Data)


March
  31,
  December
  31,2001
  2000(unaudited)Current assets:Cash and cash equivalents
  $44,661
  $59,374Accounts receivable
  2,712
  2,444Income taxes receivable
  1,074
  1,074Deferred income taxes
  4,849
  4,849Other current assets
  4,873
  4,453Total current assets
  58,169
  72,194Net property and equipment
  397,439
  397,989Other assets:Deferred finance costs, net
  13,288
  7,767Goodwill and other intangible assets,
  net
  352,075
  56,681Other, net
  2,597
  2,605Total other assets
  367,960
  67,053Total assets
  $823,568
  $537,236Current liabilities:Accounts payable
  $12,595
  $15,304Accrued payroll and related expenses
  11,866
  11,677Other accrued liabilities
  50,120
  52,275Accrued interest
  10,659
  2,659Current maturities of long-term debt
  1,430
  23,775Total current liabilities
  86,670
  105,690Long-term debt
  605,906
  252,561Deferred income taxes
  11,876
  10,762Other long-term obligations
  241
  236Minority interests in equity
  of consolidated subsidiaries
  -
  64,035Stockholders' equity:Common stock, $.01 par; 60,000,000 shares authorized; 28,501,089 and      28,394,423 shares issued and
  outstanding at March 31, 2001 and December 31, 2000,     respectively
  285
  284Capital in excess of par
  81,032
  80,693Retained earnings
  37,558
  22,975Total stockholders' equity
  118,875
  103,952Total liabilities and
  stockholders' equity
  $823,568
  $537,236See
accompanying notes to condensed consolidated financial statements.

ARGOSY
GAMING COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME(In Thousands, Except Share and Per Share
Data)


Three
  Months EndedMarch
  31,
  2001
  March
  31,
  2000(unaudited)
  (unaudited)Revenues:Casino
  $171,780
  $165,528Admissions
  4,639
  4,988Food, beverage and other
  17,167
  16,496193,586
  187,012Less promotional allowances
  (22,851)
  (22,741)Net revenues
  170,735
  164,271Costs and expenses:Casino
  64,530
  61,199Selling, general and administrative
  35,314
  33,685Food, beverage and other
  12,578
  11,059Other operating expenses
  8,052
  7,570Depreciation and amortization
  10,073
  8,835130,547
  122,348Income from operations
  40,188
  41,923Other income (expense):Interest income
  486
  482Interest expense
  (11,882)
  (10,107)(11,396)
  (9,625)Income before income
  taxes and minority interests
  28,792
  32,298Minority interests
  (4,086)
  (10,379)Income tax expense
  (10,123)
  (8,500)Net income
  $14,583
  $13,419Basic income per share
  $0.51
  $0.47Diluted income per share
  $0.50
  $0.46See
accompanying notes to condensed consolidated financial statements.

ARGOSY GAMING COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In Thousands, Except Share and Per Share
Data)

Three
  Months EndedMarch
  31, 2001
  March
  31, 2000(unaudited)
  (unaudited)Cash flows from operating
  activities:Net 
  income
  $14,583
  $13,419Adjustments to reconcile net income to
  net cash provided by operating activities:Depreciation
  8,395
  8,166Amortization
  2,052
  1,038Compensation expense recognized on
  issuance of stock
  -
  28Minority interests
  4,086
  10,379Deferred income taxes
  (259)
  7,103Changes in operating assets and
  liabilities:Other current assets
  (694)
  1,344Accounts payable and other current
  liabilities
  3,619
  (7,899)Net cash provided by operating
  activities
  31,782
  33,578Cash flows from investing
  activities:Purchases of property and equipment
  (7,751)
  (5,922)Purchase of Minority Interests in
  Partnership
  (366,265)
  -Other
  (1,105)
  -Net cash used in investing
  activities
  (375,121)
  (5,922)Cash flows from financing
  activities:Payments on long-term debt
  (14,215)
  (1,425)Repayment of partner loans
  (266)
  (3,110)Partnership equity distributions
  (5,199)
  (4,048)Proceeds from issuance of subordinated
  notes
  159,000
  -Proceeds from (repayment of) line of
  credit, net
  195,400
  (18,800)Payments of deferred finance costs
  (5,999)
  -Payment of preferred equity return and
  dividends to partner
  (456)
  (1,037)Proceeds from stock option exercises
  340
  -Other
  21
  -Net cash provided by (used in)
  financing activities
  328,626
  (28,420)Net decrease in cash
  and cash equivalents
  (14,713)
  (764)Cash and cash
  equivalents, beginning of period
  59,374
  47,090Cash and cash
  equivalents, end of period
  $44,661
  $46,326See
accompanying notes to condensed consolidated financial statements.

ARGOSY GAMING COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY(In Thousands, Except Share and Per Share
Data)

Shares
  Common
  Stock
  Capital
  in Excess of Par
  Retained
  Earnings
  Total
  Stockholders' EquityBalance, December 31,
  2000
  28,394,423
  $284
  $80,693
  $22,975
  $103,952Stock
  options exercised
  106,666
  1
  339
  -
  340Net
  income for the three months
        ended March 31, 2001
  -
  -
  -
  14,583
  14,583Balance, March 31,
  2001
  28,501,089
  $285
  $81,032
  $37,558
  $118,875See
accompanying notes to condensed consolidated financial statements.

ARGOSY
GAMING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)(In Thousands, Except Share and Per Share
Data)

1.Basis of
Presentation

Argosy Gaming Company (collectively with its
subsidiaries, "Argosy" or "Company") is engaged in the
business of providing casino style gaming and related entertainment to the
public, through its riverboat casinos in Alton, Illinois; Lawrenceburg, Indiana;
Riverside, Missouri; Baton Rouge, Louisiana; and Sioux City, Iowa.

The accompanying unaudited condensed consolidated
financial statements have been prepared in accordance with the instructions to
Form 10-Q and Article 10 of Regulation S-X. 
Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements.  Interim results may not
necessarily be indicative of results which may be expected for any other
interim period or for the year as a whole. 
For further information, refer to the financial statements and footnotes
thereto for the year ended December 31, 2000, included in the Company's Annual
Report on Form 10-K (File No. 1-11853). 
The accompanying unaudited condensed consolidated financial statements
contain all adjustments which are, in the opinion of management, necessary to
present fairly the financial position and the results of operations for the
periods indicated.  Such adjustments
include only normal recurring accruals. 
Certain 2000 amounts have been reclassified to conform to the 2001
financial statement presentation.

The Company adopted new
accounting guidance (EITF 00-14 and EITF 00-22) issued in, and effective for,
the first quarter 2001, which requires that the cost of the cash-back component
of the Companys Argosy Preferred Card slot and table program, including
promotional coupons, be treated as a reduction of revenues.  These costs had previously been treated as a
casino expense.  The new guidance
impacts only the classification of these costs on Argosys income
statement.  It does not impact operating
profit or property EBITDA.  The prior
years results have been reclassified to reflect the impact of implementing
this new guidance.

2.          Long-Term Debt

Long-term debt consists of the following:

March
  31, 2001
  December
  31, 2000Senior Subordinated
  Notes including unamortized premium of
     $8,896 at March 31, 2001, due June 2009, interest payable
     semi-annually at 10.75%
  $358,896
  $200,000Senior secured line of
  credit, expires June 2004, interest payable
     at least quarterly at either LIBOR or prime plus a margin
  242,800
  47,400Notes payable,
  principal and interest payments due quarterly
     through September 2015, discounted at 10.5%
  5,640
  5,831Notes payable,
  principal and interest payments due monthly,
     interest payable at prime + 1%, secured by gaming vessel at
     certain equipment
  -
  14,024Loans from partner,
  principal due in annual installments, interest
     payable at prime + 6%
  -
  9,081607,336
  276,336Less:  current maturities
  1,430
  23,775Long-term debt, less
  current maturities
  $605,906
  $252,561On February 1, 2001, the Company issued $150,000 of
additional Senior Subordinated Notes (Subordinated Notes) due 2009.  Prior to this issuance, the Company had
$200,000 of outstanding Subordinated Notes. 
On March 2, 2001, the Company entered into an amended and restated
Senior Secured Line of Credit Agreement (Credit Facility), increasing the
Companys available line of credit from $195,000 to $400,000.  The Credit Facility is secured by liens on
substantially all of the Companys assets and the Companys subsidiaries are
co-borrowers.  Substantially all of the
Companys wholly-owned operating subsidiaries guarantee the Subordinated
Notes.  The Subordinated Notes rank
junior to all of the senior indebtedness of the Company, including borrowings
under the Credit Facility.

The Subordinated Notes and the Credit Facility contain
certain restrictions on the payment of dividends on the Companys common stock
and the incurrence of additional indebtedness, as well as other customary debt
covenants.  In addition, the Credit
Facility requires the Company to maintain certain financial ratios.

3.          Earnings Per Share

The following table sets
forth the computation of basic and diluted earnings per share:

Three
  Months EndedMarch
  31,
  2001
  March
  31,
  2000(unaudited)
  (unaudited)Numerator:Numerator for basic
  and diluted earnings per share -Net Income
  $14,583
  $13,419Denominator:Denominator for basic
  earnings per share -Weighted-average shares outstanding
  28,455,459
  28,232,917Effect of dilutive
  securities (computed using the treasury stock method):Restricted stock
  -
  98,217Employee and directors stock options
  718,385
  706,340Warrants
  75,023
  65,643Dilutive potential
  common shares
  793,408
  870,200Denominator for
  diluted earnings per share - adjustedWeighted-average shares and assumed
  conversions
  29,248,867
  29,103,117Basic earnings per
  share
  $0.51
  $0.47Diluted earnings per
  share
  $0.50
  $0.464.LawrenceburgAcquisition

On February 22, 2001, Argosy Gaming
Company completed its purchase of a 29% limited partnership interest in the
Argosy Casino and Hotel in Lawrenceburg, Indiana ( the Lawrenceburg Casino)
from Conseco Entertainment, L.L.C. (Conseco).  The purchase price for the 29% minority interest was $260 million
and included the repayment of Consecos preferred equity interest and outstanding
partner loans.  The Company and Conseco
also settled all pending litigation between the partners.

On March 8, 2001, the Company completed its purchase of
the remaining 13.5% limited partnership interest in the Lawrenceburg Casino
from Centaur, Inc. (Centaur).  The
purchase price for the 13.5% minority interest was $105 million.

As a result of these acquisitions, the Company now owns
100% of the Lawrenceburg casino.

The purchase prices for the minority interests were
determined based upon estimates of future cash flows and evaluations of the net
worth of the assets acquired.  The
purchases are being accounted for under the purchase method.  The allocation of the purchase price
resulted in approximately $295 million in goodwill, which is being amortized
over a 40-year life.  The purchases were
funded with approximately $155 million of net proceeds received by the Company
from its February 8, 2001, private placement of senior subordinated notes and
borrowings of approximately $210 million under the Companys recently amended
and restated $400 million senior credit facility.

The following unaudited pro forma consolidated financial
information for the Company has been prepared assuming acquisitions of Conseco
and Centaur minority interests in our Lawrenceburg property had occurred on the
first day of the period.

Pro
  Formas for the three months endedMarch
  31, 2001
  March
  31, 2000(unaudited)
  (unaudited)Net revenues
  $170,735
  $164,271Income from operations
  $40,298
  $41,802Net income
  $14,489
  $14,065Diluted net income per
  share
  $0.50
  $0.48These unaudited pro forma results are presented for
comparative purposes only.  The pro
forma results are not necessarily indicative of what our actual results would
have been had the acquisitions been completed as of the beginning of the
period, or of future results.

5.Commitmentsand Contingent Liabilities

On April 16, 2001, the Company
signed an agreement to acquire the stock of the company which operates the
Empress Casino and Hotel located in Joliet, Illinois, from Horseshoe Gaming
Holding Corporation for $465,000.  We
have received a financing commitment from Wells Fargo to fund the
acquisition.  The acquisition is subject
to customary conditions precedent, including approvals under the Hart Scott
Rodino Act and from the Illinois Gaming Board. 
The Gaming Boards in the five states in which Argosy operates must also
approve the additional financing necessary to complete this acquisition.  We anticipate closing the transaction, subject
to receiving all required approvals, in the third quarter of 2001.

The Company has agreed to provide
up to $40,000 as part of our agreement to develop and operate a proposed casino
in Kenosha, Wisconsin.  The proposed
casino would be owned by the Memominee Indian Tribe of Wisconsin.  Of this $40,000 commitment, we have advanced
$1,000 during 2001 and will advance up to an additional $4,000 upon the tribe
receiving approval from the United States Bureau of Indian Affairs to place the
proposed casino property in federal trust. 
Our obligation to provide the next $30,000 of our commitment will be
made as a subordinated note concurrent with, and conditioned upon, the tribe
successfully completing an institutional debt offering to finance the majority
of the costs of the project.  Finally,
we have agreed to provide a $5,000 completion guarantee on the construction of
the proposed facility.  This project and
our funding commitment are subject to numerous regulatory approvals.

The Company is subject to, from time to time, various
legal and regulatory proceedings in the ordinary course of its business.  The Company believes that current
proceedings will not have a material effect on the financial condition of the
Company or the results of its operations.

6.Subsidiary
Guarantors

The
Credit Facility is secured by a first lien on substantially all of the
Companys assets and the Companys subsidiaries are co-borrowers.  The Subordinated Notes are fully and
unconditionally guaranteed, on a joint and several basis, by substantially all
of the Companys subsidiaries.  The
Subordinated Notes rank junior to all of the senior indebtedness of the
Company, including borrowings under the Credit Facility.

The Company's subsidiary which
operates the Lawrenceburg Casino and Hotel is now a guarantor.  Prior to the Company's acquisition of the
minority interests in Lawrenceburg, the subsidiary was a non-guarantor.  As such, previous financial statements have
been reclassified to reflect this subsidiary as a guarantor.

Condensed
balance sheets as of March 31, 2001, and December 31, 2000, are as follows:

March
  31, 2001Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedCurrent assets:Cash and cash equivalents
  $3,294
  $41,367
  $-
  $44,661Other current assets
  4,517
  8,991
  -
  13,508Total current assets
  7,811
  50,358
  -
  58,169Net property and equipment
  2,560
  394,879
  -
  397,439Other assets:Goodwill and other intangible assets, net
  13,205
  352,158
  -
  365,363Investment in subsidiaries
  652,238
  -
  (652,238)
  -Other, net
  264
  2,333
  -
  2,597Total other assets
  665,707
  354,491
  (652,238)
  367,960Total assets
  $676,078
  $799,728
  $(652,238)
  $823,568Current liabilities:Accounts payable
  $739
  $11,856
  $-
  $12,595Other current liabilities
  17,107
  55,538
  -
  72,645Current maturities of long-term debt
  760
  670
  -
  1,430Total current liabilities
  18,606
  68,064
  -
  86,670Long-term debt
  600,936
  4,970
  -
  605,906Intercompany advances and
  investments, net
  -
  356,769
  (356,769)
  -Deferred income taxes
  2,697
  9,179
  -
  11,876Other long-term obligations
  -
  241
  -
  241Minority interests in equity
  of consolidated subsidiaries
  (65,036)
  -
  65,036
  -Stockholders' equity:Common stock, $.01 par; 60,000,000 shares
  authorized; 28,501,089    shares issued and outstanding at
  March 31, 2001
  285
  1
  (1)
  285Capital in excess of par
  81,032
  5,256
  (5,256)
  81,032Retained earnings (deficit)
  37,558
  355,248
  (355,248)
  37,558Total stockholders' equity
  118,875
  360,505
  (360,505)
  118,875Total liabilities and
  stockholders' equity
  $676,078
  $799,728
  $(652,238)
  $823,568December
  31, 2000Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedCurrent assets:Cash and cash equivalents
  $3,476
  $55,898
  $-
  $59,374Other current assets
  4,842
  7,978
  -
  12,820Total current assets
  8,318
  63,876
  -
  72,194Net property and equipment
  2,181
  395,808
  -
  397,989Other assets:Goodwill and other intangible assets, net
  7,657
  56,791
  -
  64,448Investment in subsidiaries
  343,751
  -
  (343,751)
  -Other, net
  271
  2,334
  -
  2,605Total other assets
  351,679
  59,125
  (343,751)
  67,053Total assets
  $362,178
  $518,809
  $(343,751)
  $537,236Current liabilities:Accounts payable
  $1,960
  $13,344
  $-
  $15,304Other current liabilities
  7,283
  59,328
  -
  66,611Current maturities of long-term debt
  -
  23,775
  -
  23,775Total current liabilities
  9,243
  96,447
  -
  105,690Long-term debt
  247,400
  5,161
  -
  252,561Intercompany advances and
  investments, net
  -
  102,241
  (102,241)
  -Deferred income taxes
  1,583
  9,179
  -
  10,762Other long-term obligations
  -
  236
  -
  236Minority interests in equity
  of consolidated subsidiaries
  -
  -
  64,035
  64,035Stockholders' equity:Common stock, $.01 par; 60,000,000 shares
  authorized; 28,394,423    shares issued and outstanding at
  December 31, 2000
  284
  1
  (1)
  284Capital in excess of par
  80,693
  5,256
  (5,256)
  80,693Retained earnings (deficit)
  22,975
  300,288
  (300,288)
  22,975Total stockholders' equity
  103,952
  305,545
  (305,545)
  103,952Total liabilities and
  stockholders' equity
  $362,178
  $518,809
  $(343,751)
  $537,236Condensed
statements of income for the three months ended March 31, 2001 and 2000, are as
follows

Three
  months ended March 31, 2001Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedRevenues:Casino
  $-
  $171,780
  $-
  $171,780Admissions
  -
  4,639
  -
  4,639Food, beverage and other
  953
  17,167
  (953)
  17,167953
  193,586
  (953)
  193,586Less promotional allowances
  (2)
  (22,849)
  -
  (22,851)Net revenues
  951
  170,737
  (953)
  170,735Costs and expenses:Casino
  -
  64,530
  -
  64,530Selling, general and administrative
  4,925
  31,342
  (953)
  35,314Food, beverage and other
  -
  12,578
  -
  12,578Other operating expenses
  55
  7,997
  -
  8,052Depreciation and amortization
  84
  9,989
  -
  10,0735,064
  126,436
  (953)
  130,547Income (loss) from
  operations
  (4,113)
  44,301
  -
  40,188Other income (expense):Interest income
  1,428
  578
  (1,520)
  486Interest expense
  (7,225)
  (6,177)
  1,520
  (11,882)(5,797)
  (5,599)
  -
  (11,396)Income (loss) before
  income taxes, minority interests and equity in    net income of consolidated
  subsidiaries
  (9,910)
  38,702
  -
  28,792Equity in net income
  of consolidated subsidiaries
  18,570
  -
  (18,570)
  -Minority interests
  -
  (4,086)
  -
  (4,086)Income tax (expense)
  benefit
  5,923
  (16,046)
  -
  (10,123)Net income (loss)
  $14,583
  $18,570
  $(18,570)
  $14,583Three
  months ended March 31, 2000Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedRevenues:Casino
  $-
  $165,528
  $-
  $165,528Admissions
  -
  4,988
  -
  4,988Food, beverage and other
  1,218
  16,296
  (1,018)
  16,4961,218
  186,812
  (1,018)
  187,012Less promotional allowances
  (4)
  (22,737)
  -
  (22,741)Net revenues
  1,214
  164,075
  (1,018)
  164,271Costs and expenses:Casino
  -
  61,199
  -
  61,199Selling, general and administrative
  3,576
  31,127
  (1,018)
  33,685Food, beverage and other
  -
  11,059
  -
  11,059Other operating expenses
  107
  7,463
  -
  7,570Depreciation and amortization
  95
  8,740
  -
  8,8353,778
  119,588
  (1,018)
  122,348Income (loss) from
  operations
  (2,564)
  44,487
  -
  41,923Other income (expense):Interest income
  1,733
  1,569
  (2,820)
  482Interest expense
  (8,460)
  (4,467)
  2,820
  (10,107)(6,727)
  (2,898)
  -
  (9,625)Income (loss) before income
  taxes, minority interests and equity in    net income of consolidated
  subsidiaries
  (9,291)
  41,589
  -
  32,298Equity in net income
  of consolidated subsidiaries
  19,563
  -
  (19,563)
  -Minority interests
  -
  (10,379)
  -
  (10,379)Income tax (expense)
  benefit
  3,147
  (11,647)
  -
  (8,500)Net income (loss)
  $13,419
  $19,563
  $(19,563)
  $13,419Condensed
statements of cash flows for the three months ended March 31, 2001 and 2000,
are as follows:

Three
  months ended March 31, 2001Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedNet cash provided by
  operating activities
  $5,105
  $26,677
  $-
  $31,782Cash flows from investing
  activities:Purchases of property and equipment
  (448)
  (7,303)
  -
  (7,751)Purchase of minority interests in
  Partnership
  (63,689)
  (302,576)
  -
  (366,265)Investments in and advances from (to)
  subsidiaries
  (289,891)
  289,891
  -
  -Other
  -
  (1,105)
  -
  (1,105)Net cash used in investing activities
  (354,028)
  (21,093)
  -
  (375,121)Cash flows from financing
  activities:Payments on long-term debt
  -
  (14,215)
  -
  (14,215)Repayment of partner loans
  -
  (266)
  -
  (266)Partnership equity distributions
  -
  (5,199)
  -
  (5,199)Proceeds from issuance of subordinated
  notes
  159,000
  -
  -
  159,000Proceeds from line of credit, net
  195,400
  -
  -
  195,400Payments of deferred finance costs
  (5,999)
  -
  -
  (5,999)Payment of preferred equity return and
  dividends to partner
  -
  (456)
  -
  (456)Proceeds from stock option exercises
  340
  -
  -
  340Other
  -
  21
  -
  21Net cash provided by (used in)
  financing activities
  348,741
  (20,115)
  -
  328,626Net decrease in cash
  and cash equivalents
  (182)
  (14,531)
  -
  (14,713)Cash and cash
  equivalents, beginning of period
  3,476
  55,898
  -
  59,374Cash and cash
  equivalents, end of period
  $3,294
  $41,367
  $-
  $44,661Three
  months ended March 31, 2000Parent
  Company
  Guarantors
  Eliminations
  ConsolidatedNet cash provided by
  operating activities
  $2,776
  $30,802
  $-
  $33,578Cash flows from investing
  activities:Purchases of property and equipment
  (390)
  (5,532)
  -
  (5,922)Investments in and advances (to) from
  subsidiaries
  16,505
  (16,505)
  -
  -Net cash (used in) provided by
  investing activities
  16,115
  (22,037)
  -
  (5,922)Cash flows from financing
  activities:Payments on long-term debt
  -
  (1,425)
  -
  (1,425)Repayment of partner loans
  -
  (3,110)
  -
  (3,110)Partnership equity distributions
  -
  (4,048)
  -
  (4,048)Repayment of line of credit, net
  (18,800)
  -
  -
  (18,800)Payment of preferred equity return and
  dividends to partner
  -
  (1,037)
  -
  (1,037)Other
  102
  (102)
  -
  -Net cash (used in) financing
  activities
  (18,698)
  (9,722)
  -
  (28,420)Net (decrease)
  increase in cash and cash equivalents
  193
  (957)
  -
  (764)Cash and cash
  equivalents, beginning of period
  531
  46,559
  -
  47,090Cash and cash
  equivalents, end of period
  $724
  $45,602
  $-
  $46,326ARGOSY
GAMING COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Except
where otherwise noted, the words, we, us, our and similar terms, as well
as references to Argosy or the Company refer to Argosy Gaming Company and
all of its subsidiaries.

Overview

Through our subsidiaries, we own and operate the Alton
Belle Casino, in Alton, Illinois; the Argosy Casino in Riverside, Missouri; the
Argosy Casino in Baton Rouge, Louisiana; the Belle of Sioux City Casino in
Sioux City, Iowa; and the Argosy Casino in Lawrenceburg, Indiana.  In the first quarter of 2001, the Company
became the sole owner of the Argosy Casino in Lawrenceburg, Indiana, through
the purchase for a total of $365,000 of the 42.5% minority interests in the
property.  Prior to this acquisition, we
were the majority owner of the Lawrenceburg casino and, as such, our historical
consolidated financial statements included the assets, liabilities and results
of operations for the Lawrenceburg casino on a consolidated basis.  As a result, we have allocated the entire
purchase price on a preliminary basis to goodwill.  Because Argosy did not become the sole owner of the Lawrenceburg
casino until late in the first quarter 2001, its full impact in terms of
increased interest expense and amortization and the elimination of minority
interest, will not be reflected until the second quarter of 2001.  On February 5, 2001, we opened our 300-room
hotel at our Baton Rouge location.

On April 16, 2001, the Company
signed an agreement to acquire the stock of the company which operates the
Empress Casino and Hotel located in Joliet, Illinois, from Horseshoe Gaming
Holding Corporation for $465,000.  We
have received a financing commitment from Wells Fargo to fund the
acquisition.  The acquisition is subject
to customary conditions precedent, including approvals under the Hart Scott
Rodino Act and from the Illinois Gaming Board. 
The Gaming Boards in the five states in which Argosy operates must also
approve the additional financing necessary to complete this acquisition.  We anticipate closing the transaction,
subject to receiving all required approvals, in the third quarter of 2001.

Three
  Months EndedMarch
  31, 2001
  March
  31, 2000(unaudited)
  (unaudited)Casino
  RevenuesAlton Belle Casino
  $31,087
  $28,188Argosy Casino - Riverside
  25,375
  24,830Argosy Casino - Baton Rouge
  19,054
  17,674Belle of Sioux City Casino
  8,869
  8,996Argosy Casino - Lawrenceburg
  87,395
  85,840Total
  $171,780
  $165,528Net
  Revenues (1)Alton Belle Casino
  $29,940
  $27,202Argosy Casino - Riverside
  24,391
  23,817Argosy Casino - Baton Rouge
  18,570
  16,982Belle of Sioux City Casino
  8,632
  8,724Argosy Casino - Lawrenceburg
  89,069
  87,294Other
  133
  252Total (1)
  $170,735
  $164,271Income (loss) from Operations(2)Alton Belle Casino
  $9,500
  $8,433Argosy Casino - Riverside
  5,830
  4,717Argosy Casino - Baton Rouge
  2,121
  3,379Belle of Sioux City Casino
  1,855
  1,549Argosy Casino - Lawrenceburg
  28,580
  29,002Corporate
  (6,097)
  (3,582)Jazz Enterprises, Inc. (5)
  (1,243)
  (1,323)Other
  (358)
  (252)Total
  $40,188
  $41,923EBITDA(2)(3)Alton Belle Casino
  $10,938
  $9,986Argosy Casino - Riverside
  6,854
  6,072Argosy Casino - Baton Rouge
  3,505
  4,431Belle of Sioux City Casino
  2,244
  1,916Argosy Casino - Lawrenceburg
  33,197
  34,220Lawrenceburg financial advisory fee (4)
  (927)
  (1,711)Corporate
  (4,982)
  (3,487)Jazz Enterprises, Inc. (5)
  (555)
  (648)Other
  (13)
  (21)Total
  $50,261
  $50,758(1)         New accounting guidance issued in, and
effective for, the first quarter 2001 requires that the cost of the cash-back
component of the Companys Argosy Preferred Card slot and table program,
including promotional coupons, be treated as a reduction of revenues.  These costs had previously been treated as a
casino expense.  The new guidance
impacts only the classification of these costs on Argosys income
statement.  It does not impact operating
profit or property EBITDA.  The prior
years results have been reclassified to reflect the impact of implementing
this new guidance.

(2)Income
from operations and EBITDA exclude (i) consideration of any management fee paid
to us, (ii) 42.5% minority interest in our Lawrenceburg casino for periods
prior to our February 2001 acquisition of Conseco Entertainment, L.L.C.s 29.0%
minority interest and our March 2001, acquisition of Centaur, Inc.s 13.5%
minority interest and (iii) the 30% minority interest in our Sioux City casino
for the period prior to our July 2000 acquisition of this interest.

(3)         EBITDA is defined as earnings before
interest, taxes, depreciation and amortization and is presented before any
management fees paid to Argosy.  EBITDA
should not be construed as an alternative to operating income, or net income
(as determined in accordance with generally accepted accounting principles) as
an indicator of our operating performance, or as an alternative to cash flows
generated by operating, investing and financing activities (as an indicator of
cash flow or a measure of liquidity). 
EBITDA is presented solely as a supplemental disclosure because
management believes that it is a widely used measure of operating performance
in the gaming industry and for companies with a significant amount of
depreciation and amortization.  EBITDA
may not be comparable to similarly titled measures reported by other
companies.  We have other significant
uses of cash flows, including debt service and capital expenditures, which are
not reflected in EBITDA.

(4)         The Lawrenceburg partnership paid a
financial advisory fee equal to 5.0% of its EBITDA to a minority partner prior
to our acquisition of Consecos minority interest in February, 2001.

(5)         Jazz Enterprises, Inc. is a
wholly-owned subsidiary that owns and operates the Catfish Town real estate
development adjacent to the Companys Baton Rouge casino.

Three months ended March 31, 2001 compared to three months
ended March 31,  2000

CasinoCasino
revenues for the three months ended March 31, 2001, increased $6.3 million, or
3.8%, to $171.8 million from $165.5 million for the three months ended March
31, 2000.  The western properties
(Alton, Riverside, Sioux City and Baton Rouge) reported an aggregate 5.9%
increase in casino revenues from $79.7 to $84.4 million. In particular, Alton
casino revenues increased from $28.2 to $31.1 million, Riverside casino
revenues increased from $24.8 to $25.4 million, Sioux City casino revenues
decreased from $9.0 to $8.9 million, and Baton Rouge casino revenues increased
from $17.7 to $19.1 million. Lawrenceburg casino revenues increased $1.6
million, or 1.8%, to $87.4 million for the three months ended March 31, 2001,
from $85.8 million for the three months ended March 31, 2000.  Each of our casinos reported increases in
the average win per passenger for the three months ended March 31, 2001, versus
the three months ended March 31, 2000.

Casino expenses increased $3.3 million to $64.5 million
for the three months ended March 31, 2001, from $61.2 million for the three
months ended March 31, 2000.  This
increase is due to increased gaming taxes totaling $1.6 million and increases
in other casino expenses of $1.7 million to support the overall increased
revenues and payroll related costs at all properties.

AdmissionsAdmissions revenues (net of complimentary admissions)
decreased to $4.6 million for the three months ended March 31, 2001, from $5.0
million for the three months ended March 31, 2000, due to an increase in
complimentary admissions given to customers as part of Lawrenceburgs marketing
program.

Food, Beverage and OtherFood, beverage and other revenues increased $0.7 million
to $17.2 million for the three month period ended March 31, 2001, from $16.5
million for the three month period ended March 31, 2000.  Food, beverage and other net profit
decreased $0.8 million to $4.6 million for the three months ended March 31,
2001, from $5.4 million for the three months ended March 31, 2000.

For the
three months ended March 31, 2001, the Lawrenceburg hotel generated $1.0
million in net revenues and $0.4 million of operating profit.  For the three months ended March 31, 2000,
the Lawrenceburg hotel generated $0.9 million in net revenues and $0.3 million
of operating profit.

The
Baton Rouge hotel opened on February 5, 2001. 
For this initial period of operations ending March 31, 2001, the Baton
Rouge hotel generated $0.8 million in net revenues and incurred a $0.5 million
operating loss.  The hotel occupancy percentage was 33% and the average
daily room rate was $90.

Selling, General and AdministrativeSelling, general and administrative expenses increased
$1.6 million to $35.3 million for the three months ended March 31, 2001, from
$33.7 million for the three months ended March 31, 2000, due primarily to an
increase at Corporate of $0.7 million in compensation costs, an increase at
Lawrenceburg of $0.2 million related to additional payments required to be paid
to the city as a result of increased gaming revenue and $0.7 million of
increased costs at all other properties relating to expanded promotions and
general operating costs.

Other Operating ExpensesOther operating expenses increased by $0.5 million to
$8.1 million for the three months ended March 31, 2001, as compared to $7.6
million for the three months ended March 31, 2000, due to increases
attributable to the overall increase in revenues.

Depreciation and AmortizationDepreciation and amortization increased $1.3 million
from $8.8 million for the three months ended March 31, 2000, to $10.1 million
for the three months ended March 31, 2001, due primarily to $1.0 million in
incremental goodwill amortization related to the Lawrenceburg acquisition late
in the first quarter 2001.

Interest ExpenseNet interest expense increased $1.8 million to $11.4
million for the three months ended March 31, 2001, from $9.6 million for the
three months ended March 31, 2000.  This
increase is primarily attributable to additional borrowings under our amended
and restated Credit Facility and the issuance of additional Senior Subordinated
Notes related to our Lawrenceburg acquisition completed late in the first
quarter 2001.

Minority Interests  Our minority interest
expense decreased by $6.3 million to $4.1 million for the three months ended
March 31, 2001, as compared to $10.4 million for the three months ended March
31, 2000.  This decrease is attributable
to our Lawrenceburg casino minority interest acquisitions during the first quarter
2001, and as the sole owner, we will no longer incur minority interest expense.

Income Tax Expense  Income tax expense
increased by $1.6 million to $10.1 million for the three months ended March 31,
2001, from $8.5 million for the three months ended March 31, 2000.  During the three months ended March 31, 2001
and 2000, we recorded income tax expense at effective rates of 41% and 39%,
respectively.

Competition

Our Alton Casino faces competition from four other
riverboat casino operators in the St. Louis area.  Our Riverside Casino faces competition from three casino
companies in the Kansas City area.  Our
Baton Rouge Casino faces competition from one casino located in downtown Baton
Rouge, a nearby Native American casino and multiple casinos throughout
Louisiana. We face competition in Sioux City, Iowa from video gaming devices in
nearby South Dakota, from two land-based Native American casinos and, to a
lesser extent, from slot machines at a pari-mutual race track in Council
Bluffs, Iowa and from two riverboat casinos in the Council Bluffs, Iowa/Omaha,
Nebraska market.  The Lawrenceburg
casino faces competition from two riverboat casinos in the Cincinnati market,
the second of which opened in October 2000. 
In addition, the Lawrenceburg casino competes with a riverboat casino in
the Louisville, Kentucky area approximately 100 miles from our Lawrenceburg
facility.  There could be further
unanticipated competition in any market which we operate as a result of legislative
changes or other events.  We expect each
market in which we participate, both current and prospective, to be highly
competitive.

Liquidity and Capital Resources

In the three months ended March 31, 2001, we generated
cash flows from operating activities of $31.8 million compared to $33.6 million
for the same period in 2000.

In the
three months ended March 31, 2001, we used cash flows for investing activities
of $375.1 million compared to $5.9 million for the three months ended March 31,
2000.  The increase in the use of funds
for the three months ended March 31, 2001, is due primarily to our acquisition
of the minority interests in the Lawrenceburg casino requiring the use of
$366.3 million in cash.  During the
three months ended March 31, 2001, $4.2 million of cash flows were used for construction
of the Baton Rouge Hotel.

During
the three months ended March 31, 2001, cash of $328.7 million was provided by
financing activities compared to using $28.4 million of cash flows for
financing activities for the same period in 2000.  In the first quarter 2001, $159.0 million was provided through
the issuance of $150.0 million of additional 10 3⁄4% Senior Subordinated Notes,
due 2009, at a price of 106% of par.  In
addition, as of March 31, 2001, we had
borrowed an additional $195.4 million on our line of credit.  These funds were used to fund the purchase
of the Lawrenceburg casino minority interest. 
Cash flows in 2001 and 2000 were used for repayment of long-term debt,
repayment of partner loans, and distributions related to the Lawrenceburg partnership.

At
March 31, 2001, we had approximately $44.7 million of cash and cash
equivalents.  At March 31, 2001, we had
outstanding $358.9 million of Senior Subordinated Notes, due June 2009,
including $8.9 million of unamortized premium, and $242.8 million on a senior
secured revolving credit facility, due June 2004.  The Senior Subordinated Notes bear interest at 10.75%, and the
Senior Secured Credit Facility bears interest at LIBOR or prime plus a margin.
As of May 1, 2001, availability under the credit facility was approximately
$155.4 million.  The Subordinated Notes
and the Credit Facility contain certain restrictions on the payment of
dividends on the Companys common stock and the occurrence of additional indebtedness,
as well as other typical debt covenants. 
In addition, the Credit Facility requires the Company to maintain
certain financial ratios as follows: 
(1) Total Leverage Ratio of a maximum of 4.0 to 1.0; (2) Senior Leverage
Ratio of a maximum of 2.75 to 1.0; and (3) Fixed Charge Ratio of a minimum of
1.25 to 1.0.  As of March 31, 2001, the
Company is in compliance with these ratios.

We have made a significant
investment in property and equipment and plan to make significant additional
investments at certain of our existing properties.  In 2001, we expect maintenance capital expenditures primarily
related to the purchase of new gaming product and facility enhancements to be
approximately $19.1 million, and expenditures related to the Baton Rouge hotel
and other project capital expenditures to be approximately $14.4 million.

We have obtained a commitment
letter from Wells Fargo allowing us to increase our borrowings under our Senior
Credit Facility to provide the $465 million in funding for our proposed
acquisition of the Empress Casino and Hotel in Joliet, Illinois, and up to $40
million for our proposed Kenosha casino development.  Additionally, we are considering other available financing
alternatives.  We believe that cash on
hand, operating cash flows, and funds available under commitment from Wells
Fargo, subject to regulatory approval, will be sufficient to fund our Empress
acquisition, our commitment to develop the Kenosha casino and our current
operating, capital expenditure and debt service obligations for the next 12
months.

Consistent with gaming industry
practice, we conduct our operations with a net working capital deficit.  Unlike traditional industrial companies, a
gaming companys balance sheet has limited accounts receivable and inventories.  In addition, casinos generate significant
cash on a daily basis.  We generally
apply our daily cash flows to pay down indebtedness under our revolving credit
facility and pay our current liabilities pursuant to their normal cycles.  Given the significant daily cash flows
generated by our operations and the financial flexibility provided by our
credit facility, the existence of a working capital deficit has no impact on
our ability to operate our business or meet our obligations as they become due.

Cautionary Statements for Purposes of the "Safe
Harbor" Provisions of the Private Securities Litigation Reform Act of 1995

This Report contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.  When used in this document, the words
"anticipate", "believe", "estimate" and
"expect" and similar expressions are generally intended to identify
forward-looking statements.  Investors
are cautioned that any forward-looking statements, including those regarding
the intent, belief or current expectations of the Company or its management,
are not guarantees of future performance and involve risks and uncertainties,
and that actual results may differ materially from those in the forward-looking
statements as a result of various factors including, but not limited to, (i)
competitive and general economic conditions in the markets in which the Company
operates, (ii) increased competitive pressures in the markets in which the
Company operates, (iii) the effect of future legislation or regulatory changes
on the Company's operations, (iv) the ability of the Company to finance the
contemplated Empress Casino Joliet acquisition on attractive terms, (v)
approvals of the transaction contemplated by the various gaming boards and
commissions that regulate the Company, (vi) approval of other regulatory and
governmental agencies to which the contemplated transaction is subject, and
(vii) other risks detailed from time to time in the Company's Securities and
Exchange Commission filings.  The
Company does not intend to update these forward-looking statements.

ARGOSY GAMING COMPANYOTHER
INFORMATION

PART
II.Other Information

Item
1.Legal Proceedings -

The Company is from time to time a party to legal
proceedings arising in the ordinary course of business. Other than as disclosed
below, the Company is unaware of any legal proceedings, which, even if the
outcome were unfavorable to the Company, would have a material adverse impact
on either its financial condition or results of operations.

Lawrenceburg Partnership Appraisal Litigation

On
February 22, 2001, we completed our purchase of Consecos 29.0% minority
interest for $260 million, including the repayment of Consecos preferred
equity interest and outstanding partner loans. 
In connection with the December 2000 purchase agreement, we have settled
all litigation between Conseco and us.

Item 2.Changes in Securities -None

Item 3.Defaults Upon Senior Securities -None

Item 4.Submission of Matters to a Vote of Security Holders -None

Item 5.Other Information-None

Item
6.Exhibits and reports on Form
8-K

(a)Exhibits -None.

(b)Reports on Form 8-K

1.          Report on Form 8-K dated February 1,
2001, filed with the Securities and Exchange Commission, containing a Press
Release dated January 31, 2001, announcing that the Company is pursuing a
private placement of $100 million of Senior Subordinated Notes.2.Report
on Form 8-K dated February 6, 2001, filed with the Securities and Exchange
Commission, containing pro forma financial data and related notes regarding the
expected acquisition of the  minority
interests in the Lawrenceburg casino.3.Report
on Form 8-K dated March 9, 2001, filed with the Securities and Exchange
Commission, containing the following related to the Companys completed
acquisition of Consecos 29.0% minority interests in the Lawrenceburg casino on
February 22, 2001, and the completed acquisition of Centaurs 13.5% minority
interests on March 8, 2001:a.Pro
forma financial information.

ARGOSY GAMING COMPANYSIGNATURES

Pursuant to the
requirement of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.



Date: 
  May 15, 2001
  /s/  
  Dale R. BlackDale R. BlackSenior Vice President-Chief  Financial Officer