<PAGE>


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                 ______________

                                    FORM 10-Q


(Mark One)

[ X ]        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934


             For the quarterly period ended       December 31, 1999
                                            ____________________________________


                                       or

[   ]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934

             For the transition period from _______________to __________________

                         Commission file number       0-14897
                                                  ______________


                           Players International, Inc.
________________________________________________________________________________
             (Exact name of registrant as specified in its charter)

        Nevada                                            95-4175832
________________________________________________________________________________
(State or other jurisdiction of             (I.R.S. employer identification no.)
incorporation or organization)

  1300 Atlantic Ave., Suite 800        Atlantic City, NJ            08401
________________________________________________________________________________
(Address of principal executive offices)                         (Zip code)

Registrant's telephone number, including area code          (609) 449-7777
                                                    ____________________________


________________________________________________________________________________
              (Former name, former address and former fiscal year,
                         if changed since last report.)

         Indicate by check 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. Yes _X_  No__


                      APPLICABLE ONLY TO CORPORATE ISSUERS:

         As of February 11, 2000, there were 32,286,077 shares of the
registrant's Common Stock outstanding, net of treasury stock.


<PAGE>




                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
                  --------------------------------------------

                                      INDEX
                                      -----


PART I - FINANCIAL INFORMATION                                              PAGE

Item 1.  Financial Statements

         Condensed Consolidated Balance Sheets as of December 31, 1999
         and March 31, 1999                                                    3

         Condensed Consolidated Statements of Operations for the Three
         and Nine Months Ended December 31, 1999 and 1998                      5

         Condensed Consolidated Statements of Cash Flows for the Nine
         Months Ended December 31, 1999 and 1998                               6

         Notes to Condensed Consolidated Financial Statements                  7

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                11

Item 3.  Quantitative and Qualitative Disclosures About Market Risk           18


PART II - OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders                  19

Item 6.  Exhibits and Reports on Form 8-K                                     19

         Signature                                                            20



                                       2


<PAGE>




PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.



                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

                                     ASSETS

<TABLE>
<CAPTION>
                                                                              December 31,         March 31,
                                                                                   1999              1999
                                                                               ------------       ----------
                                                                               (Unaudited)
<S>                                                                             <C>                <C>
Current assets:
    Cash and cash equivalents                                                   $ 27,892           $ 25,687
    Accounts receivable, net of allowance for doubtful accounts of
       $437 at December 31, 1999 and $461 at March 31, 1999                        1,606              1,882
    Notes receivable                                                                   -              1,500
    Inventories                                                                    1,379              1,164
    Deferred income tax                                                            3,281              3,281
    Income taxes refundable                                                        5,163                634
    Prepaid expenses and other current assets                                      2,373              2,081
                                                                                --------           --------

           Total current assets                                                   41,694             36,229
                                                                                --------           --------


Property and equipment, net of accumulated depreciation
    and amortization of $73,335 at December 31, 1999 and
    $59,846 at March 31, 1999                                                    221,040            222,437
                                                                                --------           --------


Intangibles, net of accumulated amortization of $5,266 at
    December 31, 1999 and $4,535 at March 31, 1999                                33,937             34,344
                                                                                --------           --------

Investment in joint venture                                                       87,337             91,034
                                                                                --------           --------

Other assets                                                                       4,501              5,091
                                                                                --------           --------


Total assets                                                                    $388,509           $389,135
                                                                                ========           ========
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                       3
<PAGE>


                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                    (dollars in thousands, except par value)

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

<TABLE>
<CAPTION>
                                                                                December 31,       March 31,
                                                                                   1999              1999
                                                                                ------------       --------
                                                                               (Unaudited)
<S>                                                                             <C>                <C>
Current liabilities:
    Current portion of long-term debt                                           $     --           $    541
    Accounts payable                                                               3,058              3,627
    Accrued liabilities                                                           29,939             31,197
    Due to Harrah's (Jackpot termination fee)                                     13,500                 --
    Other liabilities                                                             17,563             19,555
                                                                                --------           --------

           Total current liabilities                                              64,060             54,920
                                                                                --------           --------

Deferred income tax                                                                2,959              2,959
                                                                                --------           --------

Long-term debt, net of current portion                                           150,000            155,000
                                                                               ---------           --------

Other long-term liabilities                                                       16,112             16,444
                                                                                --------           --------

Stockholders' equity:
   Preferred stock, no par value, Authorized--10,000,000 shares,
      Issued--none                                                                    --                 --

   Common stock, $.005 par value, Authorized-- 90,000,000 shares, Issued--
      32,958,177 at December 31, 1999 and 32,704,837 at
      March 31, 1999                                                                 165                163
   Additional paid-in capital                                                    134,066            132,666
   Treasury stock, at cost; 672,100 shares                                        (7,294)            (7,294)
   Retained earnings                                                              28,441             34,277
                                                                                --------           --------

              Total stockholders' equity                                         155,378            159,812
                                                                                --------           --------

Total liabilities and stockholders' equity                                      $388,509           $389,135
                                                                                ========           ========
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                       4


<PAGE>


                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (dollars in thousands, except per share data)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                     For the Three Months           For the Nine Months
                                                      Ended December 31,             Ended December 31,
                                                     ---------------------        ------------------------
                                                        1999           1998           1999            1998
                                                     ------------  ------------   -------------    -----------
<S>                                                      <C>              <C>           <C>           <C>
Revenues:
  Casino                                                 $79,859       $78,045      $ 243,608      $ 237,756
  Food and beverage                                        2,167         2,297          6,901          7,393
  Hotel                                                      405           591          1,368          2,539
  Other                                                      830           839          3,175          2,902
                                                         -------       -------      ---------      ---------
                                                          83,261        81,772        255,052        250,590
                                                         -------       -------      ---------      ---------

Costs and expenses:
  Casino                                                  36,582        34,404        109,632        106,709
  Food and beverage                                        1,903         2,022          5,819          6,342
  Hotel                                                      189           216            581          1,058
  Other operating expenses                                10,541        10,685         31,275         31,559
  Selling, general and administrative                     15,624        15,584         45,824         44,529
  Corporate and other non-operating costs                  3,077         4,117         10,276          9,915
  Allocated amounts of joint venture                       2,223         2,527          7,565          7,966
  Jackpot termination fee                                      -             -         13,500              -
  Stipulation of settlement                               10,200             -         10,200              -
  Depreciation and amortization                            5,152         5,015         14,990         14,943
                                                         -------       -------      ---------      ---------
                                                          85,491        74,570        249,662        223,021
                                                         -------       -------      ---------      ---------
Income (loss) before other income (expense)
   and provision (benefit) for income taxes               (2,230)        7,202          5,390         27,569
                                                         -------       -------      ---------      ---------

Other income (expense):
  Interest income                                            103            70            354            350
  Interest expense                                        (4,864)       (5,319)       (14,723)       (16,430)
                                                         -------       -------      ---------      ---------
                                                         (4,761)       (5,249)       (14,369)       (16,080)
                                                         -------       -------      ---------      ---------

Income (loss) before provision (benefit) for
   income taxes                                           (6,991)        1,953         (8,979)        11,489

Provision (benefit) for income taxes                      (3,147)          761         (3,143)         4,481
                                                         -------       -------      ---------      ---------

Net income (loss)                                        $(3,844)      $ 1,192      $ (5,836)        $ 7,008
                                                         =======       =======      =========        =======

Earnings (loss) per common share
       Basic and diluted                                $ (0.12)       $  0.04      $   (0.18)       $  0.22
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                      5


<PAGE>


                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (dollars in thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                          For the Nine Months
                                                                                           Ended December 31,
                                                                                          --------------------
                                                                                          1999            1998
                                                                                          ----            ----

<S>                                                                                    <C>             <C>
Cash flows from operating activities:
    Net income (loss)                                                                  $ (5,836)       $ 7,008
    Adjustments to reconcile net income (loss) to net cash provided
      by operating activities:
       Depreciation and amortization                                                     14,990         14,943
       Equity in allocated amounts of joint venture                                       3,683          3,627
       Loss on disposition of property and equipment                                         49            272
       Other                                                                                (24)           231
    Changes in assets and liabilities:
        Accounts and notes receivable                                                     1,801          1,067
        Inventories, prepaid expenses and other assets                                     (577)            52
        Income taxes                                                                     (4,529)         7,640
        Accounts payable and accrued liabilities                                          2,332         (6,889)
        Other liabilities                                                                 7,033           (344)
                                                                                        -------        -------

             Net cash provided by operating activities                                   18,922         27,607
                                                                                        -------        -------

Cash flows from investing activities:
    Purchases of property and equipment                                                 (13,380)        (6,917)
    Proceeds from disposal of property and equipment                                        804             52
                                                                                        -------        -------

             Net cash used in investing activities                                      (12,576)       (6,865)
                                                                                       --------        -------

Cash flows from financing activities:
    Proceeds from issuance of long-term debt                                              5,000         20,000
    Repayments of long-term debt                                                        (10,541)       (36,484)
    Exercise of stock options                                                             1,400             --
    Debt issuance costs                                                                      --           (192)
    Other                                                                                    --            257
                                                                                       --------       --------
             Net cash used in financing activities                                       (4,141)       (16,419)
                                                                                       --------       --------

Net increase in cash and cash equivalents                                                 2,205          4,323

Cash and cash equivalents at beginning of period                                         25,687         17,223
                                                                                       --------       --------

Cash and cash equivalents at end of period                                             $ 27,892       $ 21,546
                                                                                       ========       ========

Supplemental cash flow disclosure:
    Interest paid                                                                      $ 18,714       $ 20,079
    Income taxes paid                                                                  $  2,434       $  1,689
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                      6



<PAGE>


                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

Note 1 - Basis of Presentation

     The accompanying unaudited condensed consolidated financial statements have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and note disclosures normally included
in annual financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to those rules and
regulations. It is suggested that these condensed consolidated financial
statements be read in conjunction with the financial statements and the notes
thereto included in the Company's Form 10-K for the year ended March 31, 1999.
In the opinion of management, all adjustments (which include normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flows of all periods presented have been made.

     The results of operations for the nine months ended December 31, 1999, are
not necessarily indicative of the operating results for the full year.

     Certain reclassifications have been made to the financial statements as
previously presented to conform to current classifications.

Note 2 - Agreement and Plan of Merger

     On August 19, 1999, the Company entered into an Agreement and Plan of
Merger with Harrah's Entertainment, Inc. Pursuant to the terms of the merger
agreement, the Company's stockholders will receive $8.50 in cash per share of
the Company's common stock. The stockholders of the Company approved the merger
with Harrah's at a special meeting of the stockholders held on October 28, 1999
and the Missouri Gaming Commission granted regulatory approval on the proposed
transaction on December 15, 1999. The completion of the merger is still subject
to the receipt of regulatory approvals from Illinois and Louisiana. The
Louisiana Gaming Control Board will consider the merger at its meeting on
February 15, 2000 and the Company expects to be on the agenda for the February
22, 2000, Illinois Gaming Board meeting. The Company and Harrah's have agreed
that neither party will exercise its right to terminate the Agreement and Plan
of Merger for failure to consummate the merger by January 31, 2000, until
February 29, 2000.

Note 3 - Casino Revenues and Promotional Allowances

     Casino revenues are the net of gaming wins less gaming losses. Revenues
exclude the retail value of complimentary food and beverage, hotel
accommodations and other items furnished to customers, which totaled
approximately $5.7 million and $5.9 million and $17.7 million and $18.0 million
for the three and nine months ended December 31, 1999 and 1998, respectively.

     The estimated cost of providing such complimentary services are included in
casino costs and expenses through inter-department allocations from the
department granting the services as follows:

                            For the Three Months            For the Nine Months
                             Ended December 31,             Ended December 31,
                             ------------------             ------------------
                           (dollars in thousands)         (dollars in thousands)
                            1999            1998            1999          1998
                            ----            ----            ----          ----
Food and beverage         $ 4,170         $ 4,014        $12,408         $12,607
Other                         418             398          1,267           1,182
                           ------          ------         ------         -------
                          $ 4,588         $ 4,412        $13,675         $13,789
                          =======        ========        =======         =======



                                       7


<PAGE>

                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note 4 - Allocated Amounts of Joint Venture

         The Company owns a 50% interest in a casino entertainment facility in
Maryland Heights, Missouri (the "joint venture"). The investment in the joint
venture is accounted for using the equity method of accounting.

         Summary condensed financial information for the joint venture is as
follows:
<TABLE>
<CAPTION>
                                      For the Three Months            For the Nine Months
                                       Ended December 31,              Ended December 31,
                                      ----------------------          --------------------
                                     (dollars in thousands)           (dollars in thousands)
                                      1999              1998               1999       1998
                                      ----              ----               ----       ----
<S>                                 <C>               <C>            <C>            <C>
Net revenues                        $ 5,185           $ 5,396        $ 16,318       $ 15,527
Depreciation and amortization       $ 2,503           $ 2,393        $  7,367       $  7,245
Net loss                            $ 4,445           $ 5,055        $ 15,129       $ 15,932
</TABLE>


Note 5 - Earnings Per Share

     The following table illustrates the computation of basic and diluted
earnings (loss) per share (in thousands, except per share data):

<TABLE>
<CAPTION>
                                                      For the Three Months            For the Nine Months
                                                       Ended December 31,              Ended December 31,
                                                    ---------------------           -------------------
                                                    1999            1998           1999           1998
                                                   -----          -------          ----           ----
Numerator:
<S>                                              <C>             <C>             <C>             <C>
   Net income (loss)                             $ (3,844)       $ 1,192         $(5,836)       $ 7,008

Denominator:
  Denominator for basic earnings per share-
    weighted-average shares                        32,109         31,949          32,069         31,944

  Effect of dilutive securities-stock options          --            165              --            150
                                                ---------        --------        -------         -------

Denominator for diluted earnings per share-
  adjusted weighted-average shares                  32,109        32,114          32,069         32,094
                                                  ========        ======        ========         ======

Basic earnings (loss) per share                   $ (0.12)        $ 0.04        $ ( 0.18)        $ 0.22
                                                  ========        ======        ========         ======

Diluted earnings (loss) per share                 $ (0.12)        $ 0.04         $ (0.18)        $ 0.22
                                                  ========        ======        ========         ======
</TABLE>


Note 6 - Contingencies

     The Company and its subsidiaries are defendants in certain litigation. In
the opinion of management, based upon the advice of counsel, the aggregate
liability, if any, arising from such other litigation will not have a material
adverse effect on the accompanying condensed consolidated financial statements.

Louisiana Investigation

     In April, 1997, a federal investigation of former Louisiana Governor Edwin
Edwards, his son Stephen Edwards, Richard D. Shetler and others with respect to
their involvement in the riverboat gaming industry and other matters became
public. Upon learning of the investigation, the Company immediately began
cooperating with the federal authorities. (Stephen Edwards is a former outside
attorney and Richard D. Shetler is a former consultant to and lobbyist for the
Company in Louisiana.) In August, 1998, the Company was advised in writing by
the United States Attorney that neither the Company nor its current or former
employees were subjects or targets of the federal investigation. On October 9,
1998, Richard D.

                                       8


<PAGE>


                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

Shetler pleaded guilty to conspiracy to commit extortion of the Company. On
November 6, 1998, a grand jury of the United States District Court for the
Middle District of Louisiana returned an indictment against Edwin Edwards,
Stephen Edwards, and four other defendants for matters relating to the riverboat
casino industry. The indictment charges Edwin Edwards and Stephen Edwards with
extorting and conspiring to extort the Company in violation of the Racketeer
Influenced Corrupt Organizations Act and interstate travel in aid of
racketeering. On November 12, 1998, the defendants pleaded not guilty to the
allegations set forth in the indictment. The Missouri Gaming Commission, the
Illinois Gaming Board and the Louisiana Gaming Control Board are each aware of
and are each investigating the involvement of the Company in the Shetler and
Edwards cases to determine the suitability of the Company and its subsidiaries
for continued licensure. The Company has and will continue to cooperate with the
gaming regulatory authorities in their investigations.

     On August 17, 1999, the Louisiana Gaming Control Board received and made
public a report by the Riverboat Gaming Division of the Louisiana State Police
concerning the investigation of the Company in relation to the Shetler and
Edwards cases. The report alleges, among other things, that the Company did not
report certain matters to the Louisiana regulatory authorities and that these
actions may provide grounds for the Louisiana Gaming Control Board to not renew
the Company's licenses or to impose sanctions as a condition of license renewal.

     On December 1, 1999, the Louisiana Gaming Control Board approved a
stipulation of settlement between the Company and the Riverboat Gaming Division,
conditionally renewing the Company's riverboat gaming licenses, and releasing
the Company, its current and most of its former officers, directors and
employees from any liability for the allegations contained in the report of the
Riverboat Gaming Division. The stipulation of settlement is conditioned upon a
change in control of the Company occurring within 150 days, the payment of $10.2
million, and other conditions. The payment, which has been placed in escrow
pending the change in control of the Company pursuant to a separate escrow
agreement, is remedial in nature and is not a fine, penalty or forfeiture. If a
change in control of the Company does not occur within 150 days, the stipulation
of settlement shall be void, the $10.2 million payment shall be returned to the
Company, and a hearing shall be held on the allegations contained in the report
of the Riverboat Gaming Division to determine whether the Company's licenses
shall remain in effect.

     Assurances cannot be given that disciplinary action will not be commenced,
that the licenses will be renewed, or that all conditions to existing renewals
will be satisfied. The Company is unable at this stage to determine the likely
outcome of these gaming regulatory investigations or estimate the amount or
range of potential loss, if any.

Coushatta Tribe of Louisiana Threatened Civil Action

     In June, 1999, the Coushatta Tribe of Louisiana (the "Tribe") informed the
Company of the Tribe's intention to file a civil suit. In this threatened civil
action, it is alleged that the Company wrongfully attempted to prevent the Tribe
from opening its land-based casino in Louisiana in 1993 and 1994. In the opinion
of management, based upon the advice of counsel, the Company has committed no
wrongdoings, has valid defenses, and will vigorously defend against any claims
advanced by the Tribe. The Company is unable at this stage to determine if this
threatened civil action will ever be filed, or if it is filed, to estimate the
amount or range of potential loss, if any.

Notice of Violations - Currency Transaction Reporting

         By letter dated November 23, 1999, the Financial Crimes Enforcement
Network of the U.S. Department of Treasury ("FinCEN") advised the Company that
an audit had identified 194 potential violations of the currency reporting
requirement of the Bank Secrecy Act, 31 U.S.C. SS 5311, et seq., for the period
from December 8, 1993 through March 31, 1996, for the Company's riverboat
casinos in Lake Charles, Louisiana. FinCEN's letter noted that the maximum
penalty provided by law for the 194 potential violations approximates $5.4
million. The Company is scheduled to respond in writing to FinCEN's letter on
March 1, 2000, and expects to meet with representatives of that agency
thereafter to review this matter. The Company believes that some of the
transactions identified by FinCEN as potential violations were not, in fact,
violations. In addition, similar FinCEN enforcement actions against other casino
companies have been


                                       9

<PAGE>

                  PLAYERS INTERNATIONAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

settled for amounts below the maximum penalty permitted by law. If no agreement
is reached between FinCEN and the Company, FinCEN has the power to assess a
civil penalty and to seek to enforce that penalty in federal court. The Company
is unable at this time to determine the likely outcome of this matter or to
estimate the amount or range of potential loss, if any.

Sales and Use Tax Assessment

         The Company has received Notices of Proposed Tax Due from the State of
Louisiana, Department of Revenue asserting amounts due for Louisiana General
Sales Tax, Louisiana Recovery District Tax, and Louisiana Tourism Promotion
District Tax. The total amount assessed is approximately $4.3 million, including
approximately $1.5 million in interest. In addition, any tax due the State of
Louisiana will result in an increase in corresponding sales and use taxes
assessed by Calcasieu Parish. The majority of the tax due relates to the
construction of the entertainment barge in Lake Charles. The Company believes
that this barge and the materials that became component parts of the barge are
exempt from sales and use tax in Louisiana. In addition, pursuant to the terms
of a certain Mutual Receipt, Release and Subrogation Agreement, certain third
parties agreed to indemnify and defend the Company against such tax liability.
The Company intends to vigorously enforce such rights of indemnification, if
necessary.

Jackpot Termination Fee

         In accordance with the Agreement and Plan of Merger with Harrah's, the
$13.5 million termination fee required under the Company's prior merger
agreement with Jackpot Enterprises, Inc. was paid to Jackpot by Harrah's. The
Company must reimburse Harrah's the entire fee in the following circumstances:

o  if Harrah's terminates the merger agreement in the event the Company's
   board withdraws its recommendation of the Harrah's transaction or
   recommends an alternative transaction;

o  if Harrah's terminates the merger agreement after the Company receives a
   superior proposal from a third party;

o  if Harrah's terminates the merger agreement in the event of a material
   breach of the agreement by the Company; or

o  if Harrah's terminates the merger agreement in the event of the revocation
   of the Company's gaming license in Louisiana or the imposition of a
   materially adverse fine in connection with the Shetler-Edwards matter.

This reimbursement would be in addition to the payment of the $13.5 million
termination fee to Harrah's in the circumstances specified in the merger
agreement.

         The Company must reimburse Harrah's for half the $13.5 million
termination fee paid by Harrah's to Jackpot if the expiration date passes and
either party chooses to terminate the merger agreement, or if completion of the
merger is permanently prohibited by a court or governmental entity. On January
31, 2000, the Company and Harrah's agreed that neither party will exercise its
right to terminate the Agreement and Plan of Merger for failure to consummate
the merger by January 31, 2000, until February 29, 2000.

United States Coast Guard Inspection

         The U.S. Coast Guard regulates each cruising riverboat. U.S. Coast
Guard regulations require that hulls of vessels of the type being operated by
the Company in Lake Charles and Metropolis be inspected every five years at a
U.S. Coast Guard docking facility which will cause a temporary loss of service
that could last one month or longer, unless the U.S. Coast Guard determines that
an alternative to dry docking is acceptable. The next inspections scheduled to
occur are in the fall of calendar 2000 for the Players II Riverboat in
Metropolis and the Players III Riverboat in Lake Charles, and the fall of
calendar 2003 for the Star Riverboat in Lake Charles. The Company is currently
considering several options regarding the upcoming required inspections,
however, no assurances can be given that there will not be a loss of service
related to the potential dry docking of these vessels.


                                       10


<PAGE>





Item 2.  Management's Discussion and Analysis of Financial Condition and Results
of Operations.


     The Company owns and operates riverboat gaming and entertainment
facilities. These include one dockside riverboat casino in Metropolis, Illinois
(the "Metropolis facility"), two riverboat casinos in Lake Charles, Louisiana
(the "Lake Charles facility") and two contiguous, permanently moored, dockside
riverboat casinos in Maryland Heights, Missouri (the "Maryland Heights
facility"). The Company also owns and operates a harness horseracing track in
Paducah, Kentucky. The Company's fiscal year ends on March 31st. Certain
reclassifications have been made to the financial highlights previously
presented to conform to current classifications.

     On August 19, 1999, the Company entered into an Agreement and Plan of
Merger with Harrah's Entertainment, Inc. Pursuant to the terms of the merger
agreement, the Company's stockholders will receive $8.50 in cash per share of
the Company's common stock. The stockholders of the Company approved the merger
with Harrah's at a special meeting of the stockholders held on October 28, 1999
and the Missouri Gaming Commission granted regulatory approval on the proposed
transaction on December 15, 1999. The completion of the merger is still subject
to the receipt of regulatory approvals from Illinois and Louisiana. The
Louisiana Gaming Control Board will consider the merger at its meeting on
February 15, 2000 and the Company expects to be on the agenda for the February
22, 2000, Illinois Gaming Board meeting. The Company and Harrah's have agreed
that neither party will exercise its right to terminate the Agreement and Plan
of Merger for failure to consummate the merger by January 31, 2000, until
February 29, 2000.

Results of Operations

Comparison of Operating Results for the Three-Month Periods Ended December 31,
1999 and 1998

     References to the third quarter of fiscal 2000 or fiscal 1999, mean the
three month periods ended December 31, 1999, and December 31, 1998,
respectively.

Financial Highlights
<TABLE>
<CAPTION>
                                                                For the Three Months
                                                                 Ended December 31,
                                                                --------------------
                                                                                                 % Increase/
                                                             1999                  1998           Decrease
                                                             ----                  ----             ------
                                                               (dollars in thousands,
                                                               except per share data)
<S>                                                         <C>                   <C>                 <C>
Casino Revenues
   Metropolis                                               $ 24,303              $19,069              27.4
   Lake Charles                                               30,953               34,929             (11.4)
   Maryland Heights                                           24,603               24,047               2.3
                                                            --------              -------            ------
                                                            $ 79,859              $78,045               2.3
                                                            --------              -------            ------
Total Revenues
   Metropolis                                               $ 25,101              $19,794              26.8
   Lake Charles                                               32,478               36,750             (11.6)
   Maryland Heights                                           25,521               25,025               2.0
   Other                                                         161                  203             (20.7)
                                                            --------              -------            -------
                                                            $ 83,261              $81,772               1.8
                                                            --------              -------            -------
Operating Income (Loss)
   Metropolis                                               $  7,271              $ 4,291              69.4
   Lake Charles                                                2,012                5,862             (65.7)
   Maryland Heights (a)                                        2,120                2,002               5.9
   Stipulation of settlement                                 (10,200)                   -               n.m.
   Corporate and other                                        (3,433)              (4,953)             30.7
                                                            --------              -------            ------
                                                            $ (2,230)             $ 7,202            (130.9)
                                                            --------              -------            ------
</TABLE>


                                       11



<PAGE>


<TABLE>
<CAPTION>
                                                             For the Three Months
                                                                Ended December 31,
                                                             ---------------------
                                                                                               % Increase/
                                                       1999                       1998           Decrease
                                                       ----                      -----           --------
                                                            (dollars in thousands,
                                                            except per share data)
<S>                                                            <C>                 <C>                <C>
Other Information
   Depreciation and amortization (b)                         $ 5,152              $ 5,015               2.7
   Interest expense (net)                                    $ 4,761              $ 5,249             (9.3)
   Net income (loss)                                        $(3,844)              $ 1,192           (422.5)
   Earnings (loss) per share assuming dilution               $(0.12)              $  0.04           (400.0)

Operating Margin (operating income/total revenues) (c)
   Metropolis                                                  29.0%                21.7%           7.3 pts
   Lake Charles                                                 6.2%                16.0%         (9.8) pts
   Maryland Heights                                             8.3%                 8.0%           0.3 pts
   Consolidated                                               (2.7%)                 8.8%         (11.5)pt
</TABLE>


n.m. - not meaningful

(a)  Amount includes the Company's 50% share of the Maryland Heights joint
     venture operating losses, which include depreciation and amortization. Such
     joint venture operating losses were $2.2 million and $2.5 million for the
     three months ended December 31, 1999 and 1998.

(b)  Amount excludes the Company's share of the Maryland Heights joint venture
     depreciation and amortization of approximately $1.3 million and $1.2
     million for the three months ended December 31, 1999 and 1998,
     respectively, which are included in the joint venture operating losses as
     shown above.

(c)  The "% Increase/(Decrease)" for operating margins represents the absolute
     difference in percentage points (pts) between the two periods.

     Increases in casino revenues and operating income experienced during the
third quarter of fiscal 2000 as compared to the third quarter of fiscal 1999
were attributable to the Company's Metropolis and Maryland Heights facilities.
Increases at these facilities were partially offset by decreases at the
Company's Lake Charles facility.

     The Company's Metropolis facility continued to show quarter-over-quarter
improvement in casino revenue and operating results. With the removal of
riverboat cruising requirements on June 26, 1999, Illinois riverboats have
experienced casino revenue increases in excess of 30%.

     Revenues and operating results at the Maryland Heights facility increased
slightly in the third quarter of fiscal 2000 as compared to the prior year
period. Revenue growth was not as strong as previously experienced partially due
to dockside gaming now being offered at the two Illinois riverboats located in
the St. Louis market.

     Casino revenues and operating income at the Lake Charles facility continues
to be negatively impacted during the third quarter of fiscal 2000 by a number of
factors including the ongoing road construction on Interstate 10 ("I-10"),
competitive pressures from the Isle of Capri and Grand Casino- Coushatta
facilities, and concerns over regulatory issues. With the ongoing I-10 road
construction, signage in the area encourages both eastbound and westbound
travelers to follow alternate routes. Thus, traffic flow and access to the
property has been impeded. In addition, over the past year, Grand
Casino-Coushatta has added a 250+ room hotel, two new restaurants and an
additional 30,000 square feet of gaming space with more than 800 new slot
machines. Grand Casino-Coushatta now operates an approximately 100,000 square
foot casino. Negative media coverage regarding licensing issues, resulting in
patron concern as to the future of the property (see Contingencies-Louisiana
Investigation) also impacted the property during the third quarter.

     Corporate and other expenses decreased approximately $1.5 million in the
third quarter of fiscal 2000 as compared to the prior year quarter. During the
third quarter of fiscal 2000 the Company incurred


                                       12

<PAGE>


merger and acquisition-related expenses of approximately $129,000 as compared to
$1.2 million in the third quarter of fiscal 1999. The third quarter of fiscal
1999 also included legal and consulting expenses related to the "boat in a moat"
proceedings of approximately $458,000.

     Included in the third quarter of fiscal 2000 is a charge of $10.2 million
related to a stipulation of settlement with the Louisiana Riverboat Gaming
Division regarding the renewal of the Company's riverboat licenses in Louisiana
(see Contingencies-Louisiana Investigation).

     Net interest expense decreased approximately $500,000 in the third quarter
of fiscal 2000 as compared to the third quarter of fiscal 1999, primarily due to
reductions in the amounts outstanding under the Company's line of credit.

Comparison of Operating Results for the Nine-Month Periods Ended December 31,
1999 and 1998

     References to the first nine months of fiscal 2000 or fiscal 1999, mean the
nine-month periods ended December 31, 1999, and December 31, 1998, respectively.

Financial Highlights
--------------------
<TABLE>
<CAPTION>
                                                              For the Nine Months
                                                               Ended December 31,
                                                              -------------------
                                                                                               %Increase/
                                                       1999                     1998           Decrease
                                                       ----                     -----          ---------
                                                          (dollars in thousands,
                                                           except per share data)
<S>                                                          <C>                   <C>                 <C>
Casino Revenue
   Metropolis                                                $70,159             $ 59,299              18.3
   Lake Charles                                               98,170              110,612            (11.2)
   Maryland Heights                                           75,279               67,845              11.0
                                                            --------             --------            ------
                                                            $243,608             $237,756               2.5
                                                            --------             --------            ------

Total Revenues
   Metropolis                                               $ 72,597             $ 61,585              17.9
   Lake Charles                                              103,330              117,657            (12.2)
   Maryland Heights                                           78,426               70,649              11.0
   Other                                                         699                  699                 -
                                                            --------             --------            ------
                                                            $255,052             $250,590               1.8
                                                            --------             --------            ------

Operating Income (Loss)
   Metropolis                                               $ 20,562             $ 13,573              51.5
   Lake Charles                                               11,227               21,282            (47.3)
   Maryland Heights (a)                                        8,626                4,662              85.0
   Jackpot termination fee                                  (13,500)                    -              n.m.
   Stipulation of settlement                                (10,200)                    -              n.m.
   Corporate and other                                      (11,325)             (11,948)               5.2
                                                            --------             --------            ------
                                                             $ 5,390             $ 27,569            (80.4)
                                                             -------              -------            ------

Other Information
   Depreciation and amortization (b)                        $ 14,990             $ 14,943               0.3
   Interest expense (net)                                   $ 14,369             $ 16,080            (10.6)
   Net income (loss)                                        $(5,836)             $  7,008           (183.3)
   Earnings (loss) per share assuming dilution               $(0.18)             $   0.22           (181.8)

Operating Margin (operating income/total revenues) (c)
   Metropolis                                                  28.3%                22.0%               6.3
   Lake Charles                                                10.9%                18.1%             (7.2)
   Maryland Heights                                            11.0%                 6.6%               4.4
   Consolidated                                                 2.1%                11.0%             (8.9)
</TABLE>



n.m. - not meaningful


                                       13

<PAGE>


(a)  Amount includes the Company's 50% share of the Maryland Heights joint
     venture operating losses, which include depreciation and amortization. Such
     joint venture operating losses were $7.6 million and $8.0 million for the
     nine months ended December 31, 1999 and 1998, respectively.

(b)  Amount excludes the Company's share of the Maryland Heights joint venture
     depreciation and amortization of approximately $3.7 million and $3.6
     million for the nine months ended December 31, 1999 and 1998, which are
     included in the joint venture operating losses as shown above.

(c)  The "% Increase/(Decrease)" for operating margins represents the absolute
     difference in percentage points (pts) between the two periods.

     Increases in revenues and operating income experienced during the first
nine months of fiscal 2000 as compared to the first nine months of fiscal 1999
were attributable to the Company's Metropolis and Maryland Heights facilities.
Increases at these facilities were partially offset by decreases at the
Company's Lake Charles facility.

     The Company's Metropolis facility showed significant improvement during the
first nine months of fiscal 2000 as compared to the prior year period. On June
25, 1999, the Governor of Illinois signed a bill into law allowing dockside
gaming for all Illinois casinos. The Metropolis facility commenced dockside
gaming operations on June 26, 1999. In addition to dockside gaming for slightly
more than six months, a reconfiguration of the gaming floor plus the
introduction of new slot product during the period contributed to the 24%
increase in slot revenue at this facility, while table games experienced a
modest 2% gain during the same period.

     The Maryland Heights facility continued its trend of double-digit revenue
growth for the first nine months of fiscal 2000 as the St. Louis market
continued to expand. Casino revenues in the St. Louis market, which includes two
Illinois riverboats, increased 17% during the first nine months of fiscal 2000
as compared to the prior year period. Slot revenue was the primary driver for
these revenue increases. The Maryland Heights facility added approximately 144
slot machines during the first nine months of fiscal 2000, increasing its slot
product to approximately 1600 units.

     Casino revenues and operating income at the Lake Charles facility were
negatively impacted during the first nine months of fiscal 2000 by a number of
factors including the ongoing road construction on I-10, competitive pressures
from the Isle of Capri and Grand Casino-Coushatta facilities, and concerns over
regulatory issues. With the ongoing I-10 road construction, signage in the area
encourages both eastbound and westbound travelers to follow alternate routes.
Thus, traffic flow and access to the property has been impeded. Among other
things, over the past year, Grand Casino-Coushatta has added a 250+ room hotel,
two new restaurants and an additional 30,000 square feet of gaming space with
more than 800 new slot machines. Grand Casino-Coushatta now operates an
approximately 100,000 square foot casino. In addition, casino revenues for the
nine month period ending December 31, 1999, were also impacted by disruption
associated with the demolition of the former Players Hotel and the construction
of a 250-space surface parking lot on the former hotel site. Negative media
coverage regarding licensing issues, resulting in patron concern as to the
future of the property (see Contingencies-Louisiana Investigation) also impacted
the property during the first nine months of fiscal 2000.

     Hotel revenues decreased by approximately $1.2 million in the first nine
months of fiscal 2000 as compared to the prior year period due to the November
1998 closure of the former Players Hotel in Lake Charles. The hotel was
demolished to make way for the previously mentioned 250-space surface parking
lot that opened in the first quarter of fiscal 2000. The Company now operates
only one hotel.

     Corporate and other expenses in the first nine months of fiscal 2000
decreased approximately $600,000 as compared to the first nine months of fiscal
1999. Included in the first nine months of fiscal 2000 are merger and
acquisition-related expenses of approximately $2.0 million as compared to
approximately $1.8 million in the prior year period. Also included in the first
nine months of fiscal 2000 is a $750,000 charge related to an executive
severance arrangement. In addition, the prior year period included approximately
$865,000 in legal and consulting expenses related to the "boat-in-a-moat"
proceedings in Missouri.


                                       14

<PAGE>


     During the first nine months of fiscal 2000, the Company recorded a $13.5
million charge related to the August 19, 1999 payment of a termination fee by
Harrah's to Jackpot in connection with the Company terminating its agreement
with Jackpot (see Contingencies-Jackpot Termination Fee).

     Included in the first nine months of fiscal 2000 is a charge of $10.2
million related to a stipulation of settlement with the Louisiana Riverboat
Gaming Division regarding the renewal of the Company's riverboat licenses in
Louisiana (see Contingencies-Louisiana Investigation).

     Net interest expense decreased approximately $1.7 million in the first nine
months of fiscal 2000 as compared to the first nine months of fiscal 1999,
primarily due to reductions in the amounts outstanding under the Company's line
of credit.

Additional Factors Affecting Future Operating Income

     A challenge has been mounted to the recent amendment to the Illinois law
that among other provisions, allows for continuous dockside gaming at Illinois
gaming facilities and also allows an existing licensee to own more than 10% of a
second Illinois owner's license. This amendment contains an "unseverability"
provision, meaning that if any one portion of the amendment is determined to be
invalid, the entire amendment is deemed invalid. Although the specific
provisions being challenged are related to issues other than dockside gaming or
the 10% ownership limitation on a second license, the Company is unable to
determine at this stage whether the pendency of this challenge to the recent
Illinois amendment will affect the receipt of regulatory approval needed from
Illinois gaming authorities for the merger with Harrah's, as presently
contemplated. In addition, if the amendment is deemed invalid and dockside
gaming ceases, the financial performance at the Metropolis facility could be
negatively impacted.

     On November 20, 1999, the voters of Calcasieu Parish, Louisiana approved
slot machines at Delta Downs horse racetrack facility. If companion tax
legislation is approved by the Louisiana legislature and slot machines are
installed at the racetrack, the Company's competitive position could be
weakened, as the racetrack facility is located between the Texas border and Lake
Charles, Louisiana.

     The Isle of Capri, a competitor of the Company in Lake Charles, has started
construction of an additional 250 unit all-suite hotel. Construction of this new
facility, which would strengthen the Isle of Capri's competitive position, is
anticipated to be completed in the fall of 2000.

     Hollywood Park, Inc. has indicated its intention to apply to the State of
Louisiana for a gaming license. It is anticipated that if this license is issued
and the Calcasieu Parish voters approve the casino, Hollywood Park would build a
$200 million casino complex in Lake Charles, Louisiana.

Capital Resources and Liquidity

     During the first nine months of fiscal 2000, cash generated by operations
was used to fund approximately $13.4 million in capital expenditures and to
reduce amounts outstanding under the Company's line of credit from $5.0 million
as of March 31, 1999 to $0 as of December 31, 1999. During January 2000, the
Company's line of credit was used to partially fund a $12.8 million payment
related to the Patron Fee Buy-Out Agreements (see March 31, 1999 Form 10-K) and
the final $5.1 million payment related to the Stipulation of Settlement (see
Contingencies-Louisiana Investigation). As of February 2, 2000, there was $8.0
million outstanding on the Company's line of credit.

Contingencies

 Louisiana Investigation

     In April, 1997, a federal investigation of former Louisiana Governor Edwin
Edwards, his son Stephen Edwards, Richard D. Shetler and others with respect to
their involvement in the riverboat gaming industry and other matters became
public. Upon learning of the investigation, the Company immediately began
cooperating with the federal authorities. (Stephen Edwards is a former outside
attorney and Richard D. Shetler is a former consultant to and lobbyist for the
Company in Louisiana.) In August, 1998, the Company was advised in writing by
the United States Attorney that neither the Company nor its current or former
employees were subjects or targets of the federal investigation. On October 9,
1998, Richard D. Shetler pleaded guilty to conspiracy to commit extortion of the
Company. On November 6, 1998, a grand


                                       15

<PAGE>


jury of the United States District Court for the Middle District of Louisiana
returned an indictment against Edwin Edwards, Stephen Edwards, and four other
defendants for matters relating to the riverboat casino industry. The indictment
charges Edwin Edwards and Stephen Edwards with extorting and conspiring to
extort the Company in violation of the Racketeer Influenced Corrupt
Organizations Act and interstate travel in aid of racketeering. On November 12,
1998, the defendants pleaded not guilty to the allegations set forth in the
indictment. The Missouri Gaming Commission, the Illinois Gaming Board and the
Louisiana Gaming Control Board are each aware of and are each investigating the
involvement of the Company in the Shetler and Edwards cases to determine the
suitability of the Company and its subsidiaries for continued licensure. The
Company has and will continue to cooperate with the gaming regulatory
authorities in their investigations.

     On August 17, 1999, the Louisiana Gaming Control Board received and made
public a report by the Riverboat Gaming Division of the Louisiana State Police
concerning the investigation of the Company in relation to the Shetler and
Edwards cases. The report alleges, among other things, that the Company did not
report certain matters to the Louisiana regulatory authorities and that these
actions may provide grounds for the Louisiana Gaming Control Board to not renew
the Company's licenses or to impose sanctions as a condition of license renewal.

     On December 1, 1999, the Louisiana Gaming Control Board approved a
stipulation of settlement between the Company and the Riverboat Gaming Division,
conditionally renewing the Company's riverboat gaming licenses, and releasing
the Company, its current and most of its former officers, directors and
employees from any liability for the allegations contained in the report of the
Riverboat Gaming Division. The stipulation of settlement is conditioned upon a
change in control of the Company occurring within 150 days, the payment of $10.2
million, and other conditions. The payment, which has been placed in escrow
pending the change in control of the Company pursuant to a separate escrow
agreement, is remedial in nature and is not a fine, penalty or forfeiture. If a
change in control of the Company does not occur within 150 days, the stipulation
of settlement shall be void, the $10.2 million payment shall be returned to the
Company, and a hearing shall be held on the allegations contained in the report
of the Riverboat Gaming Division to determine whether the Company's licenses
shall remain in effect.

     Assurances cannot be given that disciplinary action will not be commenced,
that the licenses will be renewed, or that all conditions to existing renewals
will be satisfied. The Company is unable at this stage to determine the likely
outcome of these gaming regulatory investigations or estimate the amount or
range of potential loss, if any.

Coushatta Tribe of Louisiana Threatened Civil Action

     In June, 1999, the Coushatta Tribe of Louisiana (the "Tribe") informed the
Company of the Tribe's intention to file a civil suit. In this threatened civil
action, it is alleged that the Company wrongfully attempted to prevent the Tribe
from opening its land-based casino in Louisiana in 1993 and 1994. In the opinion
of management, based upon the advice of counsel, the Company has committed no
wrongdoings, has valid defenses, and will vigorously defend against any claims
advanced by the Tribe. The Company is unable at this stage to determine if this
threatened civil action will ever be filed, or if it is filed, to estimate the
amount or range of potential loss, if any.

Notice of Violations - Currency Transaction Reporting

     By letter dated November 23, 1999, the Financial Crimes Enforcement Network
of the U.S. Department of Treasury ("FinCEN") advised the Company that an audit
had identified 194 potential violations of the currency reporting requirement of
the Bank Secrecy Act, 31 U.S.C. SS 5311, et seq., for the period from December
8, 1993 through March 31, 1996, for the Company's riverboat casinos in Lake
Charles, Louisiana. FinCEN's letter noted that the maximum penalty provided by
law for the 194 potential violations approximates $5.4 million. The Company is
scheduled to respond in writing to FinCEN's letter on March 1, 2000, and expects
to meet with representatives of that agency thereafter to review this matter.
The Company believes that some of the transactions identified by FinCEN as
potential violations were not, in fact, violations. In addition, similar FinCEN
enforcement actions against other casino companies have been settled for amounts
below the maximum penalty permitted by law. If no agreement is reached between
FinCEN and the Company, FinCEN has the power to assess a civil penalty and to
seek to enforce that penalty in federal court. The Company is unable at this
time to determine the likely outcome of this matter or to estimate the amount or
range of potential loss, if any.

                                       16

<PAGE>


Sales and Use Tax Assessment

     The Company has received Notices of Proposed Tax Due from the State of
Louisiana, Department of Revenue asserting amounts due for Louisiana General
Sales Tax, Louisiana Recovery District Tax, and Louisiana Tourism Promotion
District Tax. The total amount assessed is approximately $4.3 million, including
approximately $1.5 million in interest. In addition, any tax due the State of
Louisiana will result in an increase in corresponding sales and use taxes
assessed by Calcasieu Parish. The majority of the tax due relates to the
construction of the entertainment barge in Lake Charles. The Company believes
that this barge and the materials that became component parts of the barge are
exempt from sales and use tax in Louisiana. In addition, pursuant to the terms
of a certain Mutual Receipt, Release and Subrogation Agreement, certain third
parties agreed to indemnify and defend the Company against such tax liability.
The Company intends to vigorously enforce such rights of indemnification, if
necessary.

Jackpot Termination Fee

     In accordance with the Agreement and Plan of Merger with Harrah's, the
$13.5 million termination fee required under the Company's prior merger
agreement with Jackpot Enterprises, Inc. was paid to Jackpot by Harrah's. The
Company must reimburse Harrah's the entire fee in the following circumstances:

o  if Harrah's  terminates the merger agreement in the event the Company's
   board withdraws its recommendation of the Harrah's transaction or
   recommends an alternative transaction;

o  if Harrah's terminates the merger agreement after the Company receives a
   superior proposal from a third party;

o  if Harrah's terminates the merger agreement in the event of a material
   breach of the agreement by the Company; or

o  if Harrah's terminates the merger agreement in the event of the revocation
   of the Company's gaming license in Louisiana or the imposition of a
   materially adverse fine in connection with the Shetler-Edwards matter.

This reimbursement would be in addition to the payment of the $13.5 million
termination fee to Harrah's in the circumstances specified in the merger
agreement.

     The Company must reimburse Harrah's for half the $13.5 million termination
fee paid by Harrah's to Jackpot if the expiration date passes and either party
chooses to terminate the merger agreement, or if completion of the merger is
permanently prohibited by a court or governmental entity. On January 31, 2000,
the Company and Harrah's agreed that neither party will exercise its right to
terminate the Agreement and Plan of Merger for failure to consummate the merger
by January 31, 2000, until February 29, 2000.

United States Coast Guard Inspection

     The U.S. Coast Guard regulates each cruising riverboat. U.S. Coast Guard
regulations require that hulls of vessels of the type being operated by the
Company in Lake Charles and Metropolis be inspected every five years at a U.S.
Coast Guard docking facility which will cause a temporary loss of service that
could last one month or longer, unless the U.S. Coast Guard determines that an
alternative to dry docking is acceptable. The next inspections scheduled to
occur are in the fall of calendar 2000 for the Players II Riverboat in
Metropolis and the Players III Riverboat in Lake Charles, and the fall of
calendar 2003 for the Star Riverboat in Lake Charles. The Company is currently
considering several options regarding the upcoming required inspections,
however, no assurances can be given that there will not be a loss of service
related to the potential dry docking of these vessels.

Forward Looking Information

         Certain information included in this section and elsewhere in this
Quarterly Report on Form 10-Q contains, and other materials filed or to be filed
by the Company with the Securities and Exchange Commission (as well as
information included in oral statements or other written statements made or to
be made by the Company) contain or will contain or include, forward-looking
statements within the meaning of

                                       17

<PAGE>


Section 21E of the Securities and Exchange Act of 1934, as amended, and Section
27A of the Securities Act of 1933, as amended. Such forward-looking statements
address, among other things, the approval and subsequent closing of the merger
between the Company and Harrah's, the effects of competition, the resolution of
pending or threatened litigation or regulatory proceedings, I-10 road
construction in Lake Charles, the outcome of the state and parish sales and use
tax assessments, the outcome of the Currency Transaction Reporting violations,
the U.S. Coast Guard inspections, future borrowing and capital costs, plans for
future expansion and property enhancements, business development activities,
capital expenditure programs and requirements, financing sources and the effects
of legislation and regulation (including possible gaming legislation, gaming
licensure and regulation, state and local regulation, tax regulation, and the
potential for regulatory reform). Forward looking statements can generally be
identified by the use of forward-looking terminology such as "may", "will",
"expect", "intend", "estimate", "believe", or "continue" or the negative thereof
or variations thereon or similar terminology. Such forward-looking information
is based upon management's current plans or expectations and is subject to a
number of uncertainties and risks that could significantly affect current plans,
anticipated actions, and the Company's future financial condition and results of
operations. These uncertainties and risks include, but are not limited to, those
relating to the approval and subsequent closing of the merger between the
Company and Harrah's, conducting operations in an increasingly competitive
environment, changes in state and local gaming laws and regulations, development
and construction activities, leverage and debt service requirements (including
sensitivity to fluctuation in interest rates), general economic conditions, the
results of various gaming regulatory authorities' investigations as to the
Company's suitability for continued licensure, changes in federal and state tax
laws, the disruption to Lake Charles operations caused by road construction, the
outcome of state and parish sales and use tax assessments, the outcome of the
Currency Transaction Reporting violations, the U.S. Coast Guard inspections,
action taken under applications for licenses (including renewals) and approvals
under applicable laws and regulations (including gaming laws and regulations),
and the legalization of gaming in certain jurisdictions. As a consequence,
current plans, anticipated actions, and future financial condition and results
from operations may differ from those expressed in any forward-looking
statements made by or on behalf of the Company and no assurance can be given
that such statements will prove to be correct.

Item 3.   Quantitative and Qualitative Disclosure About Market Risk.

          Not Applicable


                                       18


<PAGE>



PART II - OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders

     On October 28, 1999, a Special Meeting of Stockholders was held to:

     1.   approve and adopt the Agreement and Plan of Merger, dated as of August
          19, 1999, among Players, Harrah's Entertainment, Inc. and HEI
          Acquisition Corp. II, a Nevada corporation and wholly-owned subsidiary
          of Harrah's and approve the merger of HEI Acquisition Corp. II with
          and into Players as provided for in the agreement; and

     2.   to consider and vote upon a proposal to grant the Players board of
          directors the discretionary authority to postpone or adjourn the
          special meeting in order to solicit additional votes to approve any
          matter set forth in paragraph (1) above if the Secretary of Players
          determined that there were not sufficient votes to approve any such
          matter.

There were 25,907,087 votes cast for, 36,441 votes cast against and 54,230
abstentions cast regarding Proposal No. 1. There were 23,611,470 votes cast for,
2,227,180 votes cast against and 159,108 abstentions cast regarding Proposal No
2.

Item 6.  Exhibits and Reports on Form 8-K

         Exhibits filed with this Form 10-Q:

         Exhibit No. Exhibit Description
         ----------- -------------------

          10.1       Amendment to Purchase  Agreement dated December 30, 1999,
                     between Karl E. Boellert and Players Lake Charles, LLC

          27.0       Financial Data Schedule


      Reports on Form 8-K filed during the quarter:

     On December 15, 1999, a Form 8-K was filed regarding the December 1, 1999,
stipulation of settlement with the Louisiana Gaming Control Board regarding the
renewal of the Company's riverboat licenses.


                                       19


<PAGE>



                                    SIGNATURE

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

                                        PLAYERS INTERNATIONAL, INC.

Date:    February 11, 2000              By:   /s/ Raymond A. Spera, Jr.
                                        -------------------------------
                                        Raymond A. Spera, Jr.
                                        Vice President, Chief Financial Officer,
                                        Treasurer and Secretary
                                        (Principal Financial Officer)





                                       20