**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**


**FORM
      10-K**





x
            ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934


For
      the
      fiscal year ended December
      31, 2005 .


OR


o
            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 0-22290





CENTURY
      CASINOS, INC.


(Exact
      name of registrant as specified in its charter)


DELAWARE
            
            84-1271317(State
                or other jurisdiction of incorporation or organization)
            
            (I.R.S.
                Employer Identification No.)




1263
      Lake Plaza Drive, Suite A, Colorado Springs, Colorado 80906


(Address
      of principal executive offices) (Zip Code)


(719)
      527-8300


(Registrant’s
      telephone number, including area code)





Securities
      Registered Pursuant to Section 12(b) of the Act: None





Securities
      Registered Pursuant to Section 12(g) of the Act: Common
      Stock, $.01 Par Value


(Title
      of
      class)





Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


Yes o No x





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Act.


Yes o No x





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.  Yes x No o





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of the registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. x





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.





Large
      accelerated filer o Accelerated
      filer x Non-accelerated
      filer o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act).  Yes o No x





The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the registrant as of June 30, 2005, based upon the closing
      price of $7.48 for the Common Stock on the NASDAQ Capital Market on that date,
      was $85,536,792.





As
      of
      March 8, 2006, the registrant had 22,380,567 shares of Common Stock
      outstanding.





DOCUMENTS
      INCORPORATED BY REFERENCE: Part
      III incorporates by reference from the registrant’s definitive Proxy Statement
      for its 2006 Annual Meeting of Stockholders to be filed with the Commission
      within 120 days of December 31, 2005.










-
            1
            -




**INDEX**


**Part
                  I**
              
              **Page****Item
                  1.**
              **Business**
              **4****Item
                  1A.**
              **Risk
                  Factors**
              **18****Item
                  1B.**
              **Unresolved
                  Staff Comments**
              **26****Item
                  2.**
              **Properties**
              **27****Item
                  3.**
              **Legal
                  Proceedings**
              **28****Item
                  4.**
              **Submission
                  of Matters to a Vote of Security
                  Holders**
              **28****Part
                  II****Item
                  5.**
              **Market
                  for Registrant’s Common Equity, Related Stockholder
                  Matters and Issuer Purchases of Equity
                  Securities**
              **29****Item
                  6.**
              **Selected
                  Financial Data**
              **31****Item
                  7.**
              **Management’s
                  Discussion and Analysis of Financial Condition and
                  Results of Operations**
              **32****Item
                  7A.**
              **Quantitative
                  and Qualitative Disclosures About Market
                  Risk**
              **49****Item
                  8.**
              **Financial
                  Statements and Supplementary
                  Data**
              **50****Report
                  of Independent Registered Public Accounting Firm
                  -**
                **Grant
                  Thornton LLP**
              **F1****Report
                  of Independent Registered Public Accounting Firm -**
                **Grant
                  Thornton LLP**
              **F2****Report
                  of Independent Certified Public Accountants -**
                **PricewaterhouseCoopers
                  Inc.**
              **F4****Consolidated
                  Balance Sheets as of December 31, 2005
                  and 2004**
              **F5****Consolidated
                  Statements of Earnings for the Years
                  Ended**
                **December
                  31, 2005, 2004 and
                  2003**
              **F6****Consolidated
                  Statements of Shareholders’ Equity and
                  Comprehensive Income for the Years Ended December 31, 2005, 2004
                  and
                  2003**
              **F7****Consolidated
                  Statements of Cash Flows for the Years
                  Ended**
                **December
                  31, 2005, 2004 and
                  2003**
              **F8****Notes
                  to Consolidated Financial
                  Statements**
              **F11****Item
                  9.**
              **Changes
                  in and Disagreements With Accountants on Accounting and
                  Financial Disclosure**
              **50****Item
                  9A.**
              **Controls
                  and Procedures**
              **51****Item
                  9B.**
              **Other
                  Information**
              **52**
  -
            2
            -
 
 **Part
                  III****Item
                  10.**
              **Directors
                  and Executive Officers of the
                  Registrant**
              **53****Item
                  11.**
              **Executive
                  Compensation**
              **53****Item
                  12.**
              **Security
                  Ownership of Certain Beneficial Owners and Management
                  and Related Stockholder Matters**
              **53****Item
                  13.**
              **Certain
                  Relationships and Related
                  Transactions**
              **53****Item
                  14.**
              **Principal
                  Accountant Fees and
                  Services**
              **53****Part
                  IV****Item
                  15.**
              **Exhibits
                  and Financial Statement
                  Schedules**
              **54****SIGNATURES**
              **62**
  -
            3
            -
 *Index*


**DISCLOSURE
      REGARDING FORWARD-LOOKING STATEMENTS**





**This
      Annual Report on Form 10-K and certain information incorporated herein by
      reference contain forward-looking statements within the meaning of Section
      21E
      of the Securities and Exchange Act of 1934, and, as such, may involve risks
      and
      uncertainties. All statements included or incorporated by reference in this
      Annual Report on Form 10-K, other than statements that are purely historical,
      are forward-looking statements. Forward-looking statements generally can be
      identified by the use of forward-looking terminology such as “may,” “will,”
“expect,” “intend,” “estimate,” “anticipate,” “believe,” “could,” “potential”
“continue,” or similar terminology. Forward-looking statements are not
      guarantees of future performance and are subject to risks and uncertainties
      that
      could cause actual results to differ materially from the results contemplated
      by
      the forward-looking statements.**





**The
      forward-looking statements in the Annual Report on Form 10-K are subject to
      additional risks and uncertainties further discussed under “Item 1A. Risk
      Factors” and are based on information available to us on the filing date of this
      Annual Report on Form 10-K. We assume no obligation to update any
      forward-looking statements. Readers are cautioned not to place undue reliance
      on
      forward-looking statements, which speak only as of the date of this Annual
      Report on Form 10-K. Readers should also consult the forward-looking statements
      and risk factors listed from time to time in our reports on Forms 10-Q, 8-K,
      10-K and in our Annual Report to Stockholders.**




**This
        report includes amounts translated into U.S. dollars from certain foreign
        currencies. For a description of the currency conversion methodology and
        exchange rates used for certain transactions, see Note 1 to the Consolidated
        Financial Statements included elsewhere in this
        report.**





**As
      used in this report, the terms “Company,” “we,” “our,” or “us” refer to Century
      Casinos, Inc., and each of its consolidated subsidiaries, taken as a whole,
      unless the context otherwise indicates.**





**PART
      I**





The
      following information should be read in conjunction with the Consolidated
      Financial Statements and notes thereto included in “Item 8 - Financial
      Statements and Supplementary Data” of this Annual Report on Form
      10-K.





**Item
                1.**
            **Business.**





**General**





Century
      Casinos, Inc. (“CCI”) is an international casino entertainment company involved
      in developing and operating gaming establishments and related lodging and
      restaurant facilities. We currently own and operate two gaming facilities and
      manage and facilitate eight other casino establishments. Our owner/operator
      facilities include Womacks Casino and Hotel (Womacks) in Cripple Creek, Colorado
      and the Caledon Hotel, Spa and Casino (Caledon) in Caledon, South Africa. We
      also own 50% of Casino Millennium, which is located within the Marriott Hotel
      in
      Prague, Czech Republic, and we provide technical casino services to the casino
      for a fixed monthly fee. We also provide gaming services and equipment to seven
      luxury cruise vessels on three cruise lines that include the six-star Silversea
      Cruises, The World of ResidenSea and Oceania Cruises. Furthermore, we own
      majority interests in, and have begun construction on, casino and hotel
      development projects in Central City, Colorado and Edmonton, Alberta, Canada.
      The Company continues to pursue other international projects in various stages
      of development.




CCI
        is a
        Delaware corporation and was founded in 1992. For more information about
        Century
        Casinos, Inc. please visit us on the Internet at http://www.cnty.com. Prior
        to
        December 31, 2005, we made our annual reports on Form 10-K, quarterly reports
        on
        Form 10-Q, current reports on Form 8-K, and amendments to these filings
        available free of charge through our Investor Relations website at  http://www.cnty.co m /index.php?id=28 within
        two business days from the day we filed the report with the Securities and
        Exchange Commission. Going forward, we plan on making these respective filings
        available on our website as soon as reasonably practicable after we file
        these
        reports with the Commission. Our annual reports on Form 10-K, quarterly reports
        on Form 10-Q, current reports on Form 8-K and amendments to those reports
        are
        also available on the SEC website at http://ww w .sec.gov .
        None of
        the information posted to the Company’s website is incorporated by reference
        into this Annual Report.





-
            4
            -
 *Index*





**Overview
      of Business Segments**





Our
      operations are conducted through six business segments: Cripple Creek, Colorado;
      Central City, Colorado; Edmonton, Canada; South Africa; Cruise Ship Operations;
      and Corporate and Other operations. As of December 31, 2005, we owned, operated
      or managed the following properties:





**Womacks
      Casino and Hotel - Cripple Creek, Colorado**





Since
      1996 we have owned and operated Womacks Casino and Hotel in Cripple Creek,
      Colorado through our wholly owned subsidiary, WMCK Venture Corporation. Womacks
      has 590 slot machines (of which 323 are cashless gaming machines), six limited
      stakes gaming tables, 21 hotel rooms, and one restaurant. It has 150 feet of
      frontage on Bennett Avenue, the main gaming thoroughfare in Cripple Creek,
      and
      125 feet of frontage on Second Street, also known as Highway 67, with
      approximately 23,000 square feet of floor space.  Gaming
      in
      Colorado is “limited stakes”; which restricts any single wager to a maximum of
      five dollars. While this limits the revenue potential of table games, management
      believes that slot machine play, which accounts for over 98% of total gaming
      revenues at Womacks and over 96% in Cripple Creek, is currently impacted only
      marginally by the five dollar limitation.





Management
      believes that an integral component in attracting gaming patrons to Cripple
      Creek is the availability of adequate, nearby parking spaces. We presently
      own
      310 parking spaces and lease an additional 90 spaces for a total of 400 spaces.
      We believe we have sufficient close proximity parking, but covered parking
      garages maintained by two of our competitors provide them with an advantage
      during inclement weather.





Expansion
      projects at Womacks in 2002 and 2003 increased gaming space by approximately
      5,000 square feet. Most importantly, because the construction spanned an alley
      behind the existing property, Womacks will be able to continue a single level
      expansion of the casino to the rear of the property, if desired, at a later
      date. The total construction cost of both projects, excluding new slot machines,
      was approximately $2.3 million.





Our
      future plans include the possibility of upgrading existing hotel rooms,
      increasing the number of hotel rooms and expanding the gaming floor space.
      Any
      future upgrades or expansion will be dependant on market
      development.





**Caledon
      Hotel, Spa and Casino - Caledon, South Africa**





We
      own
      and operate the Caledon Hotel, Spa and Casino through our subsidiary Century
      Casinos Caledon (Pty) Limited (“CCAL”). Caledon lies on the N-2 highway - the
      main thoroughfare between Cape Town and Durban - and is known for its wildflower
      shows, wineries and the natural historic hot springs located on the Caledon
      Hotel, Spa and Casino site. Caledon experiences its heaviest traffic during
      the
      December holiday season (summer in South Africa), which offers us some
      protection from seasonality because Womack’s revenues are higher during summer.
      The Caledon Hotel, Spa and Casino has 350 slot machines, nine unlimited stakes
      gaming tables, 81 hotel rooms, and three restaurants. Casino gaming in South
      Africa is “unlimited wagering” where each casino can set its own
      limits





-
            5
            -
 *Index*





We
      are in
      the process of subdividing approximately 450 out of 500 acres of
      undeveloped land that we own adjacent to the Caledon Hotel, Spa and Casino.
      We
      intend to sell or lease the land to an independent contractor and have them
      develop a 27 hole signature golf estate on the transferred property with
      approximately 450 residential homes and to link the property to the existing
      nine-hole municipal golf course by adding another nine holes surrounded with
      resort housing elements. We expect that the development of the golf estate
      will
      encourage additional visits to the existing casino operation.





**Casino
      Millennium - Prague, Czech Republic**





In
      January 1999, we, through our wholly owned subsidiary Century Casinos
      Management, Inc., entered into a 20-year agreement to operate a casino in the
      five star Marriott Hotel in Prague, Czech Republic. The Casino Services
      Agreement, as amended, provides for a casino service fee payable to Century
      Resorts International Ltd. of €7,250 per month (approximately $8,600 per month
      as of December 31, 2005), plus VAT (if applicable). The hotel and casino opened
      in July 1999, and we have since acquired a 50% interest in the
      project.





**Cruise
      Ships**





**Silversea
      Cruises**




On
        May
        27, 2000, we signed a casino concession agreement with Silversea Cruises,
        a
        luxury, six-star cruise line based in Fort Lauderdale, Florida for five years
        of
        casino operation on each ship. The agreement gives us the exclusive right
        to
        install and operate casinos aboard four Silversea vessels.  We
        operate each shipboard casino for our own account and pay concession fees
        based
        on gross gaming revenue. We discontinued operations on the Silver Shadow
        cruise
        ship at the end of September 2005. On March 8, 2006, we received notification
        from Silversea Cruises that the concession agreement with the Silver Whisper
        will not be renewed as of July 2, 2006 and that the concession agreement
        with
        the Silver Wind will not be renewed as of May 3, 2007. In addition, we also
        received notification that the concession agreement with the Silver Cloud
        will
        not be renewed as of March 30, 2006; however, the Company deems that we did
        not
        receive timely written notification of the Silversea’s intention to discontinue
        this agreement on the Silver Cloud, as required by the original concession
        agreement. As a result, the operation of the casino aboard the Silver Cloud
        subsequent to March 30, 2006 is uncertain at this time. Currently, we have
        a
        total of 52 slot machines and 10 tables on these three remaining ships.


**The
      World of ResidenSea** ****





On
      August
      30, 2000, we signed a five year casino concession agreement with ResidenSea
      Ltd., the operator of The World of ResidenSea, which is the world’s first luxury
      residential resort community at sea continuously circumnavigating the globe.
      The
      ResidenSea vessel has a total of 165 residences consisting of 106 private
      apartments, 19 studio apartments and 40 studios with purchase prices ranging
      from $0.8 million to $6.3 million.





We
      have
      equipped the casino with 20 slot machines and three gaming tables and operate
      the casino aboard the vessel, which had its maiden voyage in March 2002. We
      operate the casino for our own account and pay concession fees based on gross
      gaming revenue. In addition, we have a right of first refusal to install casinos
      aboard any new ships built or acquired by ResidenSea during the term of the
      agreement. Under the terms of the current agreement, the casino concession
      aboard the World of ResidenSea will expire in March 2007.




-
            6
            -
 *Index*


**Oceania
        Cruises**
 
 On
        March
        28, 2003, we signed a five year casino concession agreement with Oceania
        Cruises, Inc., a Miami-based operator in the upper premium segment of the
        cruise
        industry. In October 2005, we extended the agreement until the year 2012.
        Under
        the agreement with Oceania, we have the exclusive right to install and operate
        casinos aboard two 684-passenger cruise vessels, the Insignia and the Regatta,
        as well as the exclusive right to become Oceania’s exclusive casino
        concessionaire for any new ships that Oceania might bring into
        service.


In
      April
      2003, we opened a casino aboard the Insignia. The opening of the casino aboard
      the Regatta followed in June 2003. In April 2004, we opened a casino aboard
      an
      additional Oceania vessel, the Nautica. We have a total of 108 slots machines
      and 15 tables on the Oceania cruise ships.





**Additional
      Company Projects**





In
      addition to the operations described above, we have a number of potential gaming
      projects in various stages of development. Along with the capital needs of
      these
      potential projects, there are various other risks which, if they materialize,
      could have a materially adverse effect on a proposed project or eliminate its
      feasibility altogether. For example, in order to conduct gaming operations
      in
      most jurisdictions, we must first obtain gaming licenses or receive regulatory
      clearances. To date, we have obtained gaming licenses or approval to operate
      gaming facilities in Colorado, Louisiana, on an American Indian reservation
      in
      California, the Czech Republic, the Western Cape province of South Africa and
      in
      Alberta, Canada. While management believes that we are licensable in any
      jurisdiction, each licensing process is unique and requires a significant amount
      of funds and management time. The licensing process in any particular
      jurisdiction can take significant time and expense through licensing fees,
      background investigation costs, fees of counsel and other associated preparation
      costs. Moreover, should we proceed with a licensing approval process with
      industry partners, such industry partners would be subject to regulatory review
      as well. We seek to satisfy ourselves that industry partners are licensable,
      but
      cannot assure that such partners will, in fact, be licensable. Additional risks
      before commencing operations include the time and expense incurred and
      unforeseen difficulties in obtaining suitable sites, liquor licenses, building
      permits, materials, competent and able contractors, supplies, employees, gaming
      devices and related matters. In addition, certain licenses include competitive
      situations where, even if we are licensable, other factors such as the economic
      impact of gaming, financial and operational capabilities of competitors must
      be
      analyzed by regulatory authorities. All of these risks should be viewed in
      light
      of our limited staff and limited capital. For more information on these and
      other risks related to our business, see Item 1A, “Risk Factors”.





**Central
      City, Colorado** - On
      October 13, 2004, our wholly owned subsidiary, Century Casinos Tollgate, Inc.,
      entered into an agreement with Tollgate Venture LLC to develop and operate
      a
      proposed casino and hotel in Central City, Colorado. The $48.7 million
      development is planned to include a 60,000 square foot casino and back of house
      with 625 slot machines, six table games, 27 hotel rooms, retail, food and
      beverage amenities and a 500-space on-site covered parking garage. We
      contributed $3.5 million cash equity to the project through Century Casinos
      Tollgate, Inc., in exchange for a controlling 65% interest, and Tollgate Venture
      LLC contributed three existing non-operating casino buildings, land and land
      options valued at $5.7 million, net of mortgages, for a 35% interest. Of the
      $48.7 million in overall project costs, $3.5 million were originally contributed
      by us, $39.5 million will be financed externally, and the balance of $5.7
      million is the net value of the minority partner’s contribution. On August 2,
      2005, we secured $4.5 million in additional funding from a private investor,
      which was subsequently paid from the proceeds of our Austrian Depositary
      Certificate offering (See Item 8 - Note 8 for additional information). On
      November 21, 2005, we entered into a $35 million loan agreement with Wells
      Fargo
      Bank and a syndicate of institutional lenders (See Item 8 - Note 6 for
      additional information). The newly formed entity that owns the project, CC
      Tollgate LLC, is in the process of obtaining licensing from the Colorado
      Division of Gaming. Another of our wholly owned subsidiaries, Century Casinos
      Management, Inc., has entered into a Casino Services Agreement to manage the
      property once the project is operational. Casino licenses in Colorado are not
      limited in number by state gaming laws and are primarily subject to successful
      background investigations by the Colorado Division of Gaming. We currently
      are
      licensed in Colorado for gaming at Womacks Casino and Hotel in Cripple Creek.
      The principals of Tollgate Venture LLC currently have gaming licenses in the
      State of Colorado as well. We expect the licensing process with the Colorado
      Division of Gaming to be routine and that the license will be granted upon
      the
      completion of the casino. Construction is expected to be completed by the third
      quarter 2006.





-
            7
            -
 *Index*





Central
      City and Black Hawk are historical mining towns situated adjacent to each other
      and located in the Rocky Mountains approximately 35 miles west of Denver. Each
      city offers limited stakes gaming, and the first casinos opened in both cities
      in 1991. On November 19, 2004, a new $45.2 million four lane highway (Central
      City Parkway) opened to the public. We believe this road offers a safer and
      faster alternative route from the greater Denver area to Central City and Black
      Hawk, Colorado. The Central City Parkway is entirely new construction and
      connects I-70, the main east/west interstate highway in Colorado, first to
      Central City and then on to Black Hawk. We believe that the alternate route,
      which is a narrow two lane highway that enters these cities first at Black
      Hawk,
      is a more dangerous drive than the Central City Parkway. We believe Central
      City
      is now a prime location for limited stakes gambling establishments because
      the
      new parkway provides easy access from I-70 and because the parkway goes through
      Central City before going on to Black Hawk. All traffic entering Central City
      via this parkway must go directly past our proposed casino’s main entrance and
      parking structure. The Colorado Division of Gaming reports an increase in
      Adjusted Gross Proceeds (AGP) of 36.5% for Central City casinos and a 1.5%
      increase for Black Hawk for 2005 as compared to 2004. We believe the substantial
      increase in AGP for Central City is attributable to the Central City
      Parkway.





**Edmonton,
      Canada** - On
      February 24, 2005, through our wholly owned subsidiary, Century Resorts
      International, we acquired a 56.4% interest in Century Resorts Alberta, Inc.
      for
      approximately $2.4 million ($3.0 million Canadian). Our local partner, 746306
      Alberta, Ltd., contributed a 7.25 acre parcel of land and an existing 40 room
      hotel for the remaining 43.6% interest. On January 12, 2006, we purchased the
      remaining 43.6% minority shareholder interest in CRA for approximately $6.3
      million ($7.3 million Canadian). We paid approximately $5.0 million ($5.8
      million Canadian) at closing with the remainder payable on the first anniversary
      of the opening of the casino. Century Resorts Alberta, Inc. is developing a
      Century casino and hotel in Edmonton, Alberta, Canada. Excluding the costs
      to
      purchase the minority shareholder’s interest, the $30.5 million ($35.8 million
      Canadian) project is expected to include a casino with 600 gaming machines,
      31
      gaming tables, food and beverage amenities, a dinner theater, a 300 space
      underground parking facility, approximately 600 surface parking spaces and
      a
      26-room hotel. Of the $30.5 million in overall project costs, we contributed
      $2.4 million ($3.0 million Canadian) for our interest in CRA, $17.2 million
      ($20.0 million Canadian) will be financed through a loan from Canadian Western
      Bank, $9.0 million ($10.5 million Canadian) will be provided by us as a
      shareholder loan, and the balance of $1.9 million ($2.3 million Canadian) is
      the
      net value of the minority partner’s contribution. On September 23, 2005, CRA
      agreed to the terms of a $17.2 million ($20.0 million Canadian) credit facility
      with Canadian Western Bank (“CWB”) for the development of the casino property
      (See Item 8 - Note 6 for additional information). Construction is expected
      to be
      completed by the fourth quarter 2006. Upon completion of construction, Century
      Resorts Alberta, Inc. expects to receive its gaming license from the Alberta
      Gaming and Liquor Commission (AGLC). On December 17, 2004, the AGLC granted
      approval to begin construction of the casino property. As is customary, the
      issuance of the license does not occur until completion of construction and
      after all federal and provincial legislation, regulation and policies, and
      municipal requirements, permits, licenses and/or authorizations have been met.
      We have also entered into a long-term agreement to manage the facility.





-
            8
            -
 *Index*


Edmonton
        is one of the fastest growing cities in Canada, with a strong economic climate.
        Tourism is a significant part of the economy, and Edmonton offers a wide
        range
        of activities, including sports and outdoor activities, sightseeing, and
        nightlife/casinos. Edmonton is also home of the world’s largest shopping mall.
        (Source: Tourism in Canadian Cities - A Statistical Outlook 2001.) There
        are
        currently six casinos in the Edmonton area, including one racino.


**Newcastle,
      South Africa** - In
      November 2005, we entered into an agreement for the purchase of a 60%
      controlling stake in Balele Leisure (Pty) Ltd (“Balele”) which owns the Monte
      Vista Casino in Newcastle, South Africa and to manage Balele’s entire casino,
      resort and hotel operations. Balele has secured approximately 70 acres of land
      in a more prominent and higher traffic area in Newcastle with plans to develop
      a
      new location for the Monte Vista Casino. The construction of this new location
      will cost up to 61.0 million Rand (approximately $9.6 million), excluding VAT.
      The purchase price for the controlling 60% stake was 57.5 million Rand
      (approximately $8.6 million). An additional 2.5 million Rand (approximately
      $0.4
      million) would be payable if the casino revenue during the first twelve months
      of operation in the new location exceeds 95 million Rand (approximately $14.2
      million). The terms of the management agreement provide for a payment to Century
      Casinos of 3.75% of total revenues, plus 7.5% of Balele’s EBITDA (earnings
      before interest, tax, depreciation and amortization). The transaction is
      expected to close in the second quarter of 2006, subject to regulatory
      approvals . The
      current casino in a temporary facility has 200 slot machines and seven gaming
      tables. The initial gaming mix in the permanent facility will be 225 slot
      machines and seven gaming tables. Newcastle has a population of approximately
      350,000 and is situated halfway between Johannesburg and Durban in the province
      of Kwazulu Natal, the most populous province of South Africa with over 10
      million inhabitants.





**United
      Kingdom** - In
      December 2005, we announced plans to develop and operate a casino in Croydon,
      London, United Kingdom. Century Casinos’ partner in the project is the Westmead
      Business Group Limited, owner and operator of the Airport House and the
      Aerodrome Hotel in Croydon. The project will comprise a Large Casino (as defined
      in the UK Gambling Act 2005) with a customer area of at least 16,000 square
      feet
      for a minimum of 30 gaming tables and 150 slot machines, an expansion of the
      hotel to 150 rooms, two restaurants and several bars, a health club, an events
      and conference center for 300 guests, the existing airport museum as well as
      fully serviced office suites. Westmead Business Group and the Company will
      cooperate to secure planning and zoning permission for the proposed development
      and make applications for operating and personal casino licenses under the
      new
      UK Gambling Act as soon as the newly established Gambling Commission accepts
      such applications (estimated in the second half of 2006).





**Gauteng,
      South Africa** - In
      1997, together with Silverstar Development Ltd, we applied to the Gauteng
      Gambling Board (GGB) for a casino license in Gauteng, South Africa. After a
      preliminary determination to award a license to the project and a subsequent
      series of legal challenges and lawsuits, the license has still not been issued,
      resulting in Silverstar not being able to commence with the casino development.
      On March 29, 2005, the Supreme Court of Appeal upheld an earlier High Court
      decision to award the license to Silverstar, but the project remains subject
      to
      regulatory and related approvals being secured by Silverstar and a group led
      by
      Akani Leisure Investments, Ltd.




In
        December 2004, we entered into agreements to sell a portion of our interest
        in
        the Gauteng project and granted options to Silverstar and the Akani group
        to
        purchase our remaining interests in the Gauteng project. We received an initial
        payment of approximately $1.7 million (10.0 million Rand) for the sale of
        100%
        of the outstanding common stock of one of our indirect wholly-owned
        subsidiaries, the only asset of which was land related to this project, and
        for
        funds previously advanced to Silverstar. Also in conjunction with the
        agreements, we loaned Silverstar $0.5 million (3.0 million Rand), of which
        the
        entire amount was fully reserved, repayable in six equal annual installments
        with interest commencing January 1, 2007. We have, therefore, only recognized
        net cash proceeds of $1.2 million (7.0 million Rand) in the
        transaction.





-
            9
            -
 *Index*


The
        exercise price of the purchase options totals approximately $6.8 million
        (40.3
        million Rand). Exercisability of the purchase options is contingent on
        regulatory and related approvals being secured by Silverstar and the Akani
        group. Notwithstanding the decision by the Supreme Court of Appeal on March
        29,
        2005, the outcome of these approvals is unknown at this time; therefore the
        amounts have not been recorded.


A
      resort
      management agreement that we executed to manage the project once it becomes
      operational remains in effect. We also have retained an option granted to us
      by
      Silverstar to purchase a minority equity interest in the project. In the event
      Silverstar or the Akani group exercise the options we granted them to purchase
      our remaining interest in the project, the management agreement and equity
      options we own would be terminated.





Upon
      satisfaction of the conditions necessary to exercise their purchase option,
      the
      Akani group has agreed to provide the funds necessary for Silverstar to complete
      the project in the event the license is ultimately issued. With the financial
      backing of the Akani group, we believe funding is now available for Silverstar
      to complete its tasks and provide a higher level of assurance that we will
      ultimately get a return, via the exercise of the option, on our efforts to
      date.
      Pursuant to the Supreme Court’s decision, the Silverstar project provides for up
      to 700 slot machines and 30 gaming tables. Should the option not be exercised,
      CCI’s involvement in the project will be restored to the previous level of
      ownership and management.





**Marketing
      Strategy**





We
      do not
      follow a specific marketing strategy throughout the Company but instead focus
      on
      local circumstances and the respective market areas. Our marketing strategy
      centers around rewarding repeat customers through our player’s club programs. We
      maintain a proprietary database of primarily slot machine customers that allows
      us to create effective targeted marketing and promotional programs, cash and
      merchandise giveaways, coupons, preferred parking, food, lodging, game
      tournaments and other special events. These programs are designed to reward
      customer loyalty and attract new customers to our properties through a
      multi-tiered reward program that rewards players based on total amount wagered
      and frequency of visits. Currently, our player’s club cards allow us to update
      our database and track member gaming preferences, maximum, minimum, and total
      amount wagered and frequency of visits. All visitors to our properties are
      offered the opportunity to join our player’s club.





**Womacks
      Casino and Hotel.** **** Womacks
      is a well established and well known casino operation in the region. However,
      marketing efforts focus on attracting new customers and turning them into repeat
      customers. As competition in Cripple Creek is intense, approximately 25% of
      Womacks gaming revenues are allocated to marketing measures. The marketing
      strategy of Womacks highlights promotion of the Womacks Gold Club, a player’s
      club with a database containing profiles on over 100,000 members. Gold
      Club
      members receive benefits from membership, such as cash, coupons and food and
      lodging shown as promotional allowances in the consolidated statement of
      operations, and merchandise and preferred parking. Those who qualify for VIP
      status receive additional benefits in addition to regular club membership.
      Status is determined through player tracking. Members receive information about
      upcoming events and parties, and, depending on player ranking, also receive
      invitations to special events. We also market
      Womacks through
      a variety of media outlets including radio, print and billboard advertising
      which target Colorado Springs and Pueblo, the dominant markets for Cripple
      Creek. As one of the larger casinos in Cripple Creek, we are able to provide
      more choice to the customers in type of slot machines and promotional offers
      to
      our customers. We also continue to refine the interior of the facilities and
      modify the slot machine mix. In addition, we have the capacity to expand Womacks
      in the rear of the property on a single level at a later date.





-
            10
            -
 *Index*


**Caledon
        Hotel, Spa & Casino.** **** As with
        Womacks, the marketing strategy of The Caledon Hotel, Spa & Casino
        highlights promotion of its player’s club, which currently has over 52,000
        active members, and building its player information database. Player’s club
        members receive benefits such as cash, coupons and food and lodging shown
        as
        promotional allowances in the consolidated statement of operations, and
        merchandise and preferred parking. Player’s
        club members who qualify for VIP status receive additional benefits. Status
        is
        determined through player tracking. Members receive newsletters of upcoming
        events and parties, and, depending on player ranking, also receive invitations
        to special events. We market an array of amenities at the resort to our guests
        as a complement to the gaming experience. These currently include an 81-room
        hotel, a variety of dining experiences, the historic mineral hot spring and
        spa,
        as well as the outdoor experience (a team building facility). We are reviewing
        plans to re-use the former equestrian center, which was not in service during
        the second quarter, in conjunction with a proposed golf course
        development.


**Central
      City, Colorado*.***  Central
      City is a larger catchment area than Cripple Creek due to its proximity to
      Denver, Colorado. Due to our casino’s prominent location on the new road into
      Central City from I-70, we intend to draw the attention of people passing by.
      Our main entrance to our parking structure will be located on this main road
      and
      the parking structure will be the main parking facility for Central City
      customers. Additionally, this parking garage will be paid for, in part, by
      Central City in exchange for allowing public parking. The pedestrian exit from
      the parking garage will be through our casino. **





**Edmonton,
      Canada.** Our
      casino and hotel in Edmonton will operate under the name “Century Casino and
      Hotel.” Although it is not yet in operation, we expect that it will be the only
      casino in Edmonton with a hotel and a dinner theatre. Apart from another casino
      that is part of a shopping mall, we will be the only casino with a parking
      garage as well. Therefore, our main marketing activities will focus on package
      offers combining the casino with the hotel and/or the dinner theatre. The casino
      will be located in a highly populated area with the closest competing full
      casino approximately 20 minutes away.





**Casino
      Millennium and Cruise Ships.** We
      generally do not advertise or otherwise formulate the marketing strategy for
      these casinos, which we operate under management or concessionaire agreements.





**Competition**





**The
      Cripple Creek, Colorado Market** -
      Cripple Creek, located approximately 45 miles southwest of Colorado Springs,
      Colorado, is a historic mining town dating back to the late 1800’s that has
      developed into a tourist stop. Traffic generally is heaviest in the summer
      months and decreases to its low point in the winter months.





Cripple
      Creek is one of only three Colorado cities, exclusive of Indian gaming
      operations, where casino gaming is legal, the others being Central City and
      Black Hawk. As of December 31, 2005, there were 19 casinos operating in Cripple
      Creek, which represented 29% of the gaming devices and generated 20% of gaming
      revenues from these three cities for the year then ended.





The
      tables below set forth information obtained from the Colorado Division of Gaming
      regarding gaming revenue by market and slot machine data for Cripple Creek
      from
      calendar year 2003 through 2005. Adjusted Gross Proceeds (“AGP”) is the net win
      from gaming activities reported to the licensing jurisdiction. We use AGP to
      measure performance relative to competitors within our respective markets.
      This
      data is not intended by us to imply, nor should the reader infer, that it is
      any
      indication of future Colorado or Company gaming revenue.





-
            11
            -
 *Index*





**ANNUAL
      GAMING REVENUE BY MARKET**


*Amounts
      shown in thousands*




**2005**
            
            **%****change****Over****Prior****Year**
            
            **2004**
            
            **%****change****Over****Prior****Year**
            
            **2003**
            
            **%****change****Over****Prior****Year****CRIPPLE
                CREEK**
            
            **$**
            **151,011**
            
            
            **1.6%**
            
            **$**
            **148,689**
            
            
            **4.3%**
            
            **$**
            **142,525**
            
            
            **0.0%**Black
                Hawk
            
            $
            531,878
            
            
            1.5%
            
            $
            524,035
            
            
            3.6%
            
            $
            505,851
            
            
            -3.5%Central
                City
            
            $
            72,610
            
            
            36.5%
            
            $
            53,179
            
            
            6.6%
            
            $
            49,909
            
            
            -5.5%**COLORADO
                TOTAL**
            
            **$**
            **755,499**
            
            
            **4.1%**
            
            **$**
            **725,903**
            
            
            **4.0%**
            
            **$**
            **698,285**
            
            
            **-3.0%**








**ANNUAL
      CRIPPLE CREEK SLOT DATA**


*Amounts
      shown in thousands, except slot data*




**2005**
            
            **%****change****Over****Prior**
              **Year**
            
            **2004**
            
            **%****change****Over
                Pr****ior****Year**
            
            **2003**
            
            **%****change****Over****Prior****Year**Total
                Slot Revenue
            
            $
            146,275
            
            
            1.7%
            
            $
            143,802
            
            
            3.8%
            
            $
            138,560
            
            
            0.0%Average
                Number Of Slots
            
            
            4,752
            
            
            2.9%
            
            
            4,618
            
            
            9.2%
            
            
            4,228
            
            
            1.0%Average
                Win Per Slot Per Day
            
            
            84
                dollars
            
            
            -1.2%
            
            
            85
                dollars
            
            
            -5.6%
            
            
            90
                dollars
            
            
            -1.1%








**ANNUAL
      WOMACKS CASINO SLOT DATA**


*Amounts
      shown in thousands except slot data*




**2005**
            
            **%****change****Over****Prior****Year**
            
            **2004**
            
            **%****change****Over****Prior****Year**
            
            **2003**
            
            **%****change****Over****Prior****Year**Total
                Slot Revenue
            
            $
            18,733
            
            
            -2.7%
            
            $
            19,262
            
            
            -6.6%
            
            $
            20,625
            
            
            -12.5%Average
                Number Of Slots
            
            
            618
            
            
            -4.8%
            
            
            649
            
            
            4.3%
            
            
            622
            
            
            -2.8%Average
                Win Per Slot Per Day
            
            
            83
                dollars
            
            
            2.5%
            
            
            81
                dollars
            
            
            -11.0%
            
            
            91
                dollars
            
            
            -9.9%Market
                Share of Cripple Creek AGP
            
            
            12.8
            %
            
            -4.5%
            
            
            13.4
            %
            
            -10.1%
            
            
            14.9
            %
            
            -12.4%





-
            12
            -
 *Index*





Gaming
      in
      Colorado is “limited stakes,” which restricts any single wager to a maximum of
      five dollars. While this limits the revenue potential of table games, management
      believes that slot machine play, which accounts for over 98% of total gaming
      revenues at Womacks and 96% in Cripple Creek, is currently impacted only
      marginally by the five dollar limitation.





We
      face
      intense competition from other casinos in Cripple Creek, including a handful
      of
      casinos of similar size to or larger than Womacks, and many other smaller
      casinos. We attribute the reduction in our revenue and the decrease in our
      market share in Cripple Creek during the past two years to the opening of two
      additional casinos in Cripple Creek over the same time period. We seek to
      compete against other casinos through promotion of Womacks Gold Club and other
      marketing efforts. We believe that the casinos likely to be more successful
      and
      best able to take advantage of the market potential of Cripple Creek will be
      the
      larger casinos, such as Womacks, that have reached a certain critical mass.





Covered
      parking garages provided by two of our competitors impact the casino,
      particularly during inclement weather, providing both with a significant number
      of close proximity parking spaces. Both competitors also have a large number
      of
      hotel rooms, providing them with an advantage during inclement weather and
      the
      peak tourist season. We have not yet decided on the next phase of expansion,
      but
      we own all of the vacant property adjacent to the casino and are able to expand
      if we conclude that expansion is in our best interest.





Womacks
      competes, to a far lesser extent, with 21 casinos in Black Hawk and six casinos
      in Central City. Black Hawk and Central City are also small mountain tourist
      towns, which adjoin each other and are approximately 35 miles from Denver and
      a
      two and one-half hour drive from Cripple Creek. The primary market for Cripple
      Creek is the Colorado Springs metropolitan area, and the primary market for
      Black Hawk and Central City is the Denver metropolitan area.





**The
      Caledon, South Africa Market** - Caledon
      is a small agricultural community located approximately 60 miles east of Cape
      Town. It lies on the N-2 highway - the main thoroughfare between Cape Town
      and
      Durban - and is known for its wildflower shows, wineries and the natural
      historic hot springs located on the Caledon Hotel, Spa and Casino site. Caledon
      experiences its heaviest traffic during the December holiday season (summer
      in
      South Africa). Casino gaming in South Africa operates on an “unlimited wagering”
basis where each casino sets its own limits. Caledon has 350 slot machines
      and 9
      table games including blackjack, roulette and poker.





The
      Caledon Hotel, Spa and Casino is one of four casinos currently operating in
      the
      Western Cape Province, which has a population of approximately four million.
      Construction of a competitor’s casino approximately 45 minutes away in
      Worcester, the fifth and last casino permitted in the Western Cape under the
      Gaming Act, began in November 2005 with an opening projected by the second
      half
      of 2006. Although the competition is limited by the number of casino licenses
      and the casinos are geographically distributed, management believes that the
      Caledon Hotel, Spa and Casino faces intense competition from a large casino
      located in Cape Town approximately one hour from Caledon and, to a much lesser
      degree, two other casinos. We compete against these casinos by emphasizing
      Caledon’s destination resort appeal in its marketing campaign, by promotion of
      its players club and by superior service to its players.





The
      National Gambling Board in South Africa has approved the introduction of Limited
      Payout Machines, or LPMs. A total of 2,000 LPMs will be introduced in the
      Western Cape and no more than 200 of these devices are expected for the Overberg
      region of the Western Cape, the market in which Caledon operates. An approved
      operator, which can have a maximum of five LPMs, will be permitted to operate
      the devices without the overhead of a typical casino. They will, however, be
      subject to central monitoring.





-
            13
            -
 *Index*





The
      tables below set forth information obtained from the Western Cape Gambling
      and
      Racing Board regarding gaming revenue by market and slot machine data for the
      Western Cape market from calendar year 2003 through 2005. AGP is the net win
      from gaming activities reported to the licensing jurisdiction. We use AGP to
      measure performance relative to competitors within this market. This data is
      not
      intended by us to imply, nor should the reader infer, that it is any indication
      of future South African or Company gaming revenue.





**ANNUAL
      GAMING REVENUE BY MARKET**


*Amounts
      shown in thousands*





**2005**
            
            **%
                change****Over****Prior
                Year**
            
            **2004**
            
            **%
                change****Over****Prior
                Year**
            
            **2003**
            
            **%
                change****Over****Prior
                Year****(1)**
            
            
            
            
            
            **(1)**
            
            
            
            
            
            **(1)****CALEDON
                CASINO**
            
            
            **Rand**
            
            **R**
            **91,817**
            
            
            **14.6%**
            
            **R**
            **80,088**
            
            
            **17.8%**
            
            **R**
            **67,976**
            
            
            **11.3%**USD
                equivalent
            
            $
            14,549
            
            
            
            
            $
            12,540
            
            
            
            
            $
            9,211Other
                three casinos
            
            
            **Rand**
            
            **R**
            **1,550,909**
            
            
            **21.2%**
            
            **R**
            **1,279,219**
            
            
            **20.8%**
            
            **R**
            **1,058,619**
            
            
            **12.2%**USD
                equivalent
            
            $
            262,569
            
            
            
            
            $
            200,346
            
            
            
            
            $
            143,298**WESTERN
                CAPE TOTAL(1)**
            
            
            **Rand**
            
            **R**
            **1,643,143**
            
            
            **20.9%**
            
            **R**
            **1,359,307**
            
            
            **20.7%**
            
            **R**
            **1,126,595**
            
            
            **12.2%**USD
                equivalent
            
            $
            278,118
            
            
            
            
            $
            212,886
            
            
            
            
            $
            152,509





(1)
            Excluding
                effects of fluctuations in foreign exchange
                rate.





**THE
      CALEDON HOTEL SPA AND CASINO ANNUAL DATA**


*Amounts
      shown in thousands, except slot data*





**2005**
            
            **%
                change****Over****Prior
                Year**
            
            **2004**
            
            **%
                change****Over****Prior
                Year**
            
            **2003**
            
            **%
                change****Over****Prior
                Year**Total
                Slot Revenue
            
            R
            85,856
            
            
            17.5
            %
            R
            73,066
            
            
            17.2
            %
            R
            62,345
            
            
            12.8
            %$
            13,607
            
            
            18.9
            %
            $
            11,440
            
            
            35.5
            %
            $
            8,443
            
            
            58.0
            %Market
                Share of Western Cape AGP
            
            
            5.6
            %
            
            -5.1
            %
            
            5.9
            %
            
            -1.7
            %
            
            6.0
            %
            
            -1.6
            %Average
                Number Of Slots
            
            
            307
            
            
            6.6
            %
            
            288
            
            
            5.1
            %
            
            274
            
            
            7.9
            %Average
                Win Per Slot Per Day
            
            
            766
                Rand
            
            
            10.5
            %
            
            693
                Rand
            
            
            11.3
            %
            
            623
                Rand
            
            
            4.5
            %121
                dollars
            
            
            11.0
            %
            
            109
                dollars
            
            
            29.8
            %
            
            84
                dollars
            
            
            44.8
            %Market
                Share of Western Cape # of Slot Machines
            
            
            9.4
            %
            
            -16.8
            %
            
            11.3
            %
            
            3.7
            %
            
            10.9
            %
            
            -2.7
            %Average
                Number Of Tables
            
            
            9
            
            
            0.0
            %
            
            9
            
            
            12.5
            %
            
            8
            
            
            0.0
            %Market
                Share of Western Cape # of Tables
            
            
            9.5
            %
            
            -3.1
            %
            
            9.8
            %
            
            11.4
            %
            
            8.8
            %
            
            -11.1
            %





-
            14
            -
 *Index*





**Central
      City, Colorado** - Our
      casino under development in Central City will have a prime location at the
      end
      of the Central City Parkway and a parking garage offering free parking. Due
      to
      the advantageous location, we believe that we will be a strong competitor in
      the
      Central City-Black Hawk market. However, there are a number of large, well
      established casinos in the market.





**Edmonton,
      Alberta, Canada** - In the
      Edmonton market, we expect to have six competitors (five casinos and one
      racino). We believe we will have a competitive edge over our competitors as
      we
      intend to be the only casino operator with a hotel and a dinner theater.
      Furthermore, we anticipate being one of two casinos with a parking garage.
      We
      have a good market area as the next full casino is approximately 20 minutes
      away.





**Casino
      Millennium and Cruise Ships** - For
      Casino Millennium and the Cruise Ships, which we operate under management or
      concessionaire agreements, market data is not available. However, in Prague
      there are a large number of casinos of similar size and we face intense
      competition.





**Employees**





**Womacks
      Casino and Hotel** **-** We
      employ
      approximately 175 persons in Cripple Creek, Colorado on a full-time equivalent
      basis, including cashiers, dealers, food and beverage service personnel,
      facilities maintenance staff, security, accounting and marketing personnel. No
      labor unions represent any employee group .
      A
      standard package of employee benefits is provided to full-time employees along
      with training and job advancement opportunities.





**Caledon
      Hotel, Spa and Casino** - The
      Caledon Hotel, Spa and Casino employs approximately 289 persons on a full-time
      equivalent basis, including cashiers, dealers, room service, food and beverage
      service personnel, facilities maintenance staff, security, accounting and
      marketing personnel. No
      labor unions represent any employee group. A
      standard package of employee benefits is provided to full-time employees along
      with training and job advancement opportunities.





**Cruise
      Ships -** We
      employ approximately 33 persons onboard the cruise ships. Employees are hired
      on
      a short-term contract basis. No labor unions represent the group. Training
      and
      supervision is provided by management at Casino Millennium.





**Corporate
      Segment -** We
      employ approximately 20 persons collectively in our Colorado Springs, Colorado,
      Vienna, Austria and Capetown, South Africa offices on a full-time equivalent
      basis, including administrative, accounting, finance and management personnel.
      No labor unions represent the group. A standard package of employee benefits
      is
      provided to full-time employees along with training and job advancement
      opportunities.





**Seasonality**





**Colorado
      -** Our
      business in Cripple Creek, Colorado is at its highest levels during the tourist
      season (i.e., from May through September). Our base level (i.e., October through
      April) is expected to remain fairly constant although weather conditions during
      this period could have a significant impact on business levels in Colorado.
      The
      same will apply to Central City, Colorado.





**Caledon
      Hotel, Spa and Casino -** Our
      business in Caledon is at its highest levels of business during the holiday
      season in December. Caledon has a comparatively mild climate.





-
            15
            -
 *Index*





**Edmonton,
      Alberta, Canada -** Our
      future business in Edmonton, Alberta, Canada will be best during the tourist
      season (May through September) and December. The rest of the year should remain
      rather constant due to the hotel and the dinner theater which are part of our
      complex.





**Casino
      Millennium -** Our
      business in Prague, Czech Republic fluctuates significantly with the quality
      of
      the players. Unlike our other land based operations in Cripple Creek and
      Caledon, Casino Millennium derives the majority of its gaming revenue from
      live
      table games. The quality of the player has more of an impact on the live game
      results when compared to the income derived from slot machines.





**Cruise
      Ships -** Our
      business on the ships is generally not impacted by the time of
      year.





**Governmental
      Regulation and Licensing**





The
      ownership and operation of casino gaming facilities are subject to extensive
      state and local regulations. We are required to obtain and maintain gaming
      licenses in each of the jurisdictions in which we conduct gaming. The
      limitation, conditioning, suspension, revocation or non-renewal of gaming
      licenses, or the failure to reauthorize gaming in certain jurisdictions would
      materially adversely affect our gaming operation in that jurisdiction. In
      addition, changes in law that restrict or prohibit gaming operations in any
      jurisdiction could have a material adverse effect on our financial position,
      results of operations and cash flows.





Statutes
      and regulations can require us to meet various standards relating to, among
      other matters, business licenses, registration of employees, floor plans,
      background investigations of licensees and employees, historic preservation,
      building, fire and accessibility requirements, payment of gaming taxes, and
      regulations concerning equipment, machines, tokens, gaming participants, and
      ownership interests. Civil and criminal penalties can be assessed against us
      and/or our officers or shareholders to the extent of their individual
      participation in, or association with, a violation of any of the state and
      local
      gaming statutes or regulations. Such laws and regulations apply in all
      jurisdictions within the United States in which we may do business. Management
      believes that we are in compliance with applicable gaming
      regulations.





*Colorado,
      United States*





The
      Colorado Limited Gaming Control Commission (Commission) has adopted regulations
      regarding the ownership of gaming establishments by publicly held companies
      (the
      Regulations). The Regulations require the prior clearance of, or notification
      to, the Commission before any public offering of any securities of any gaming
      licensee or any affiliated company. The Regulations require all publicly traded
      or publicly owned gaming licensees to comply with numerous regulatory gaming
      requirements including, but not limited to, notifying/filing with the Colorado
      Division of Gaming any proxy statements, lists of shareholders, new officers
      and
      directors of the Company, any shareholders obtaining 5% or more of the Company’s
      common stock and any issuance of new voting securities. We believe that the
      Company is in compliance with applicable gaming regulations.





Other
      state regulatory agencies also impact the Company's operations, particularly
      its
      license to serve alcoholic beverages. Rules and regulations in this regard
      are
      strict, and loss or suspension of a liquor license could significantly impair,
      if not ruin, a licensee's operation. Local building, parking and fire codes
      and
      similar regulations could also impact the Company's operations and proposed
      development of its properties.





This
      applies to our operations in both Cripple Creek and Central City.





-
            16
            -
 *Index*





*Caledon,
      South Africa*





Caledon’s
      gaming operations are subject to regulation by the Western Cape Gambling and
      Racing Board under national and provincial legislation. Statutes and regulations
      require us to meet various standards relating to, among other matters, business
      licenses, licensing of employees, historic preservation, building, fire and
      accessibility requirements, payment of gaming taxes, and regulations concerning
      equipment, machines, tokens, gaming participants, and ownership interests.
      Civil
      and criminal penalties can be assessed against us and/or our officers to the
      extent of their individual participation in, or association with, a violation
      of
      any of these gaming statutes or regulations. We believe that we are in
      compliance with applicable gaming regulations.





*Edmonton,
      Canada*





Gaming
      in
      Alberta is governed by the provincial government. The Alberta Gaming and Liquor
      Commission (“AGLC”) administers and regulates the gaming industry in Alberta.
      Generally, the criminal code prohibits all gaming in Canada except forms of
      gaming that it specifically allows. Applicants for a gaming license must submit
      an application and run through an eight-step approval process. Following the
      approval of the board of the AGLC, the applicant may operate the casino applied
      for in accordance with federal and provincial legislation, regulation, and
      policies as well as the municipal requirements, permits, licenses and
      authorization relating to the casino. The AGLC will monitor the casino operator
      and his compliance with all requirements. In the event of a violation of such
      requirements, civil and criminal charges can be assessed.





*Newcastle,
      South Africa*





Newcastle’s
      gaming operations are subject to regulations by the KwaZulu-Natal Gambling
      Board
      under national and provincial legislation. Statutes and regulations require
      us
      to meet various standards relating to, among other matters, business licenses,
      licensing of employees, historic preservation, building, fire and accessibility
      requirements, payment of gaming taxes, and regulations concerning equipment,
      machines, tokens, gaming participants, and ownership interests. Civil and
      criminal penalties can be assesses against us and/or our officers to the extent
      of their individual participation in, or association with, a violation of any
      of
      these gaming statutes or regulations. We have been informed by Balele that
      they
      are substantially in compliance with applicable gaming regulations.





*Prague,
      Czech Republic*





Casino
      Millennium’s gaming operations are subject to regulation by the Czech Republic
      under national legislation. Statutes and regulations require us to meet various
      standards relating to, among other matters, business licenses, building, fire
      and accessibility requirements, payment of gaming taxes, and regulations
      concerning equipment, machines, tokens, gaming participants, and ownership
      interests. Civil and criminal penalties can be assessed against us and/or our
      officers to the extent of their individual participation in, or association
      with, a violation of any of these gaming statutes or regulations. We believe
      that we are in compliance with applicable gaming regulations.





*Cruise
      Ships*





The
      casinos onboard the cruise ships only operate when they are in international
      waters. Therefore, the gaming operations are not regulated by any national
      or
      local regulatory body. However, we follow standardized rules and practices
      in
      the daily operation of the casinos.





-
            17
            -
 *Index*





*Non-Gaming
      Regulation*





We
      are
      subject to certain federal, state and local safety and health, employment and
      environmental laws, regulations and ordinances that apply to our non-gaming
      operations. We have not made, and do not anticipate making material expenditures
      with respect to such employment and environmental laws and regulations. However,
      the coverage and attendant compliance costs associated with such laws,
      regulations and ordinances may result in future additional costs to our
      operations.





A
      minimum
      of 80% of the labor force in Caledon must be comprised of designated persons.
      A
      designated person is any person of color plus white females. Currently, 89%
      of
      the labor force in Caledon is comprised of designated persons. The license
      holder must undertake to allocate 20% of net profit of the casino, as defined
      in
      the casino license agreement, to Black Empowerment Partners. Caledon is obliged
      to allocate at least 50% of its procurement costs to Black Empowerment companies
      by December 31, 2006.





**Financial
      Information By Segment**





See
“Item
      8 - Financial Statements and Supplementary Data” - Note 12 of the Notes to
      Consolidated Financial Statements for certain financial information concerning
      each of the Company’s operating segments.





**Item
                1A.**
            **Risk
                Factors.**





**Factors
      That May Affect Future Results**





***Substantially
      all of our net operating revenue is derived from our Cripple Creek, Colorado
      and
      Caledon, South Africa casinos, and any factors that adversely impact one or
      both
      of these facilities may have a significant impact on our results of operations.***




Approximately
      91% of our net operating revenue for the year ended December 31, 2005 was
      derived from our casinos in Cripple Creek and Caledon. We expect that a
      substantial portion of our revenue for the immediate future will continue to
      be
      derived from our operations at these two facilities. If new competitors enter
      one of these markets or economic conditions in one of these regions deteriorate
      or a business interruption to one of these facilities occurs, our revenue could
      decline significantly, which may have a material adverse effect on the price
      of
      our common stock or Austrian Depositary Certificates (“ADCs”).




***We
      face significant competition, and if we are not able to compete successfully
      our
      results of operations will be harmed.***





We
      face
      intense competition from other casinos in Cripple Creek, Colorado and in the
      Western Cape region of South Africa. Competitors in Cripple Creek include some
      casinos of similar size to or larger than ours and many other smaller casinos.
      In South Africa, we compete with a much larger casino in Cape Town, and to
      a
      lesser extent with two smaller casinos. By the end of 2006, we expect to be
      competing against a new casino in Worcester, an approximate 45 minute drive
      from
      Caledon. We seek to compete in the Colorado market through promotion of the
      Womacks Gold Club and other marketing efforts, and in South Africa by
      emphasizing Caledon’s destination resort appeal, players’ club programs, and by
      superior service. Some or all of these efforts may not be successful, which
      could hurt our competitive position. In addition, the primary market served
      by
      our Cripple Creek facility is Colorado Springs, Colorado, which is 45 miles
      away, and Cripple Creek is generally not a destination resort. The number of
      casino and hotel operations in Cripple Creek may exceed market demand, which
      could make it difficult for us to sustain profitability.





-
            18
            -
 *Index*





The
      gaming industry is highly fragmented and characterized by a high degree of
      competition among a large number of participants, many of which have financial
      and other resources that are greater than our resources. Competitive gaming
      activities include casinos, video lottery terminals and other forms of legalized
      gaming in the U.S. and other jurisdictions. Legalized gaming is currently
      permitted in various forms throughout much of the world. Other jurisdictions
      may
      legalize gaming or liberalize their gaming rules in the near future. If
      additional gaming opportunities become available near our operating facilities,
      such gaming opportunities could attract players that might otherwise visit
      our
      casinos. The resulting loss of revenue at our casino may have a material adverse
      effect on our business, financial condition and results of operations. We are
      particularly vulnerable to competition at our Cripple Creek facility. If other
      gaming operations were to open closer to Colorado Springs, our operations in
      Cripple Creek could be substantially harmed, which would have a material adverse
      effect on our operations. **** In
      addition, established gaming jurisdictions could award additional gaming
      licenses or permit the expansion of existing gaming operations. New or expanded
      operations by other entities will increase competition for our gaming operations
      and could have a material adverse impact on us.





***We
      face extensive regulation and taxation from gaming and other regulatory
      authorities, which involve considerable expense and could harm our business.***





*Licensing
      requirements.* As
      owners and operators of gaming facilities, we are subject to extensive state,
      local, and in South Africa, provincial regulation. State, local and provincial
      authorities require us and our subsidiaries to demonstrate suitability to obtain
      and retain various licenses and require that we have registrations, permits
      and
      approvals to conduct gaming operations. Various regulatory authorities,
      including the Colorado Division of Gaming or the Western Cape Gambling and
      Racing Board, may for any reason set forth in applicable legislation, rules
      and
      regulations limit, condition, suspend or revoke a license or registration to
      conduct gaming operations or prevent us from owning the securities of any of
      our
      gaming subsidiaries. Like all gaming operators in the jurisdictions in which
      we
      operate or plan to operate, we must periodically apply to renew our gaming
      licenses or registrations and have the suitability of certain of our directors,
      officers and employees approved. We may not be able to obtain such renewals
      or
      approvals. For instance, we expended substantial funds to develop a riverboat
      gaming operation in Franklin County, Iowa and did not receive a gaming license
      from the appropriate regulatory agency. As a result, we were forced to terminate
      the project. In addition, we have invested in a casino project in the West
      Rand
      Area outside Johannesburg, South Africa and the granting of the license for
      this
      project has been delayed by litigation. It is uncertain when, if ever, the
      licensing process for this project will be completed. Our licenses for Edmonton,
      Alberta, Canada and Central City, Colorado are pending and may not be issued.
      Regulatory authorities may also levy substantial fines against us or seize
      our
      assets or the assets of our subsidiaries or the people involved in violating
      gaming laws or regulations. Any of these events could force us to terminate
      operations at an existing gaming facility, or could prohibit us from
      successfully completing a project in which we invest. Closing facilities or
      an
      inability to expand may have a material adverse effect on our business,
      financial condition and results of operations.





Gaming
      authorities in the U.S. generally can require that any beneficial owner of
      our
      common stock and other securities, including ADCs or common stock underlying
      the
      ADCs, file an application for a finding of suitability. If a gaming authority
      requires a record or beneficial owner of our securities to file a suitability
      application, the owner must apply for a finding of suitability within 30 days
      or
      at an earlier time prescribed by the gaming authority. The gaming authority
      has
      the power to investigate an owner's suitability and the owner must pay all
      costs
      of the investigation. If the owner is found unsuitable, then the owner may
      be
      required by law to dispose of our securities. Our certificate of incorporation
      also provides us with the right to repurchase shares of our common stock
      (including shares of common stock underlying ADCs) from certain beneficial
      owners declared by gaming regulators to be unsuitable holders of our equity
      securities, and the price we pay to any such beneficial owner may be below
      the
      price such beneficial owner would otherwise accept for his or her shares of
      our
      common stock.





-
            19
            -
 *Index*





*Potential
      changes in regulatory environment.* From
      time to time, legislators and special interest groups have proposed legislation
      that would expand, restrict or prevent gaming operations or that may otherwise
      adversely impact our operations in the jurisdictions in which we operate. Any
      expansion of gaming or restriction on or prohibition of our gaming operations
      could have a material adverse effect on our operating results. For instance,
      in
      November 2003, a Colorado ballot issue was proposed that would have permitted
      the installation of at least 500 video lottery terminals or “VLTs” at each of
      the five racetracks throughout Colorado, two of which are located in Colorado
      Springs and Pueblo, the dominant markets for Cripple Creek. If this ballot
      issue
      had passed, our casino operations in Cripple Creek might have suffered from
      reduced player visits and declining revenue. There can be no assurance that
      future attempts will not be made to pass similar ballot issues in Colorado
      or
      other markets in which we operate.





*Taxation
      and fees.* We
      believe that the prospect of significant revenue is one of the primary reasons
      jurisdictions permit legalized gaming. As a result, gaming companies are
      typically subject to significant taxes and fees in addition to normal federal,
      state, local and provincial income taxes, and such taxes and fees are subject
      to
      increase at any time. We pay substantial taxes and fees with respect to our
      operations. From time to time, federal, state, provincial and local legislators
      and officials have proposed changes in tax laws, or in the administration of
      such laws, affecting the gaming industry. In addition, worsening economic
      conditions could intensify the efforts of state provincial and local governments
      to raise revenues through increases in gaming taxes. It is not possible to
      determine with certainty the likelihood of changes in tax laws or in the
      administration of such laws. Such changes, if adopted, could materially increase
      our tax expenses and impair our profitability.





***We
      intend to develop and operate additional casino properties in the future, and
      if
      our development efforts are not successful our business may be
      harmed.***





We
      are
      currently developing and intend to operate a casino and hotel in Edmonton,
      Alberta, Canada, a casino and hotel in Central City, Colorado, a casino and
      hotel in Newcastle, South Africa, and we have invested in a proposed casino
      project in an area known as West Rand, outside Johannesburg, South Africa.
      We
      have also agreed in principle to the joint development of a project in Croydon,
      United Kingdom. Each of these projects have pending applications for gaming
      licenses, and we would be required to obtain a gaming license for any additional
      facility we attempt to open. Each licensing process is unique and requires
      a
      significant amount of funds and management time. The licensing process in any
      particular jurisdiction can take significant time and expense through licensing
      applications and fees, background investigations and related costs, fees of
      counsel, possible legal challenges and other associated processes and
      preparation costs. In addition, political factors may make the licensing process
      more difficult in one or more jurisdictions. If any of our gaming license
      applications are denied, we may have to write off costs, which could be
      significant. For instance, we invested approximately $0.2 million in the
      proposed project we were jointly pursuing in Franklin County, Iowa before the
      license for the project was denied.





Even
      if
      we receive licenses to open and operate proposed new facilities, commencing
      operations at our proposed new casino projects will require substantial
      development. Development activities involve expenses and risks, including
      expenses involved in securing licenses, permits or authorizations other than
      those required from gaming regulators, and the risk of potential cost over-runs,
      construction delays, and market deterioration. One or more of these risks may
      result in any of our currently proposed properties not being successful. If
      we
      are not able to successfully commence operations at these properties, our
      results of operations will be harmed.





-
            20
            -
 *Index*





***We
      may face disruption in integrating and managing facilities we open or acquire
      in
      the future, which could adversely impact our operations.***





We
      continually evaluate opportunities to open new properties, some of which are
      potentially significant in relation to our size. We expect to continue pursuing
      expansion opportunities, and we could face significant challenges in managing
      and integrating expanded or combined operations resulting from our expansion
      activities. The integration of any new properties we open or acquire in the
      future will require the dedication of management resources that may temporarily
      divert attention from the day-to-day business of our existing operations, which
      may interrupt the activities of those operations and could result in
      deteriorating performance from those operations. Management of new properties,
      especially in new geographic areas, may require that we increase our managerial
      staff, which would increase our expenses.





***Difficulties
      in managing our worldwide operations may have an adverse impact on our
      business.***





We
      derive
      our revenue from operations located on three continents and on cruise ships
      operating around the world. Our management is located in the U.S., South Africa
      and Continental Europe (Czech Republic and Austria). As a result of long
      distances, different time zones, culture, management and language differences,
      our worldwide operations pose risks to our business. These factors make it
      more
      challenging to manage and administer a globally-dispersed business, and increase
      the resources we must devote to operating under several different regulatory
      and
      legislative regimes. Moreover, economic or political instability in one or
      more
      of our markets could adversely affect our operations in those
      markets.





***A
      downturn in general economic conditions may adversely affect our results of
      operations.***





Our
      business operations are subject to changes in international, national and local
      economic conditions, including changes in the economy related to future security
      alerts in connection with threatened or actual terrorist attacks, such as those
      that occurred on September 11, 2001, and related to the war with Iraq, which
      may
      affect our customers' willingness to travel. A recession or downturn in the
      general economy, or in a region constituting a significant source of customers
      for our properties, could result in fewer customers visiting our properties,
      which would adversely affect our results of operations.





***The
      Cripple Creek market, which is important to our business, is subject to seasonal
      fluctuations.***





Because
      Cripple Creek is a mountain tourist town, its gaming market is subject to
      seasonal fluctuations. Typically, gaming revenues are greater in the summer
      tourist season and are lower from October through April. During the year ended
      December 31, 2005, the revenue attributable to our Cripple Creek operations
      fluctuated from a high of $5.0 million in the third quarter to a low of $3.8
      million in the first quarter. If we are not able to offset seasonal declines
      in
      our Cripple Creek operations with additional revenue from other sources, our
      quarterly results may vary considerably from period to period, which could
      cause
      the price of our common stock or ADCs to be volatile.





***Inclement
      weather and other conditions could seriously disrupt our business, which may
      hamper our financial condition and results of operations.***





The
      operations of our facilities are subject to disruptions or reduced patronage
      as
      a result of severe weather conditions. For instance, in August 2002, Prague
      experienced a devastating flood throughout the city. Public access to the city
      in the vicinity of the Casino Millennium, which we operate, was severely limited
      for months following the disaster and negatively affected casino operations.
      High winds and blizzards limit access to our property in Cripple Creek from
      time
      to time, and hurricanes or severe storms may impact the operations of our cruise
      ship casino facilities. Weather also could adversely affect our casinos in
      Central City, Colorado and Edmonton, Alberta, Canada. In the event weather
      conditions limit access to our casino properties or otherwise adversely impact
      our ability to operate our casinos at full capacity, our revenue will suffer,
      which will negatively impact our operating results.





-
            21
            -
 *Index*





***Construction
      delays and budget overruns could adversely affect our development of new casino
      projects and may harm our business.***





We
      currently are engaged in the development of new casino projects in Central
      City,
      Colorado and Edmonton, Alberta, Canada and have plans to commence construction
      on new facilities in Newcastle, South Africa and Croydon, United Kingdom. We
      also evaluate other opportunities to expand our portfolio of casino properties
      as they become available, and we may in the future engage in additional
      construction projects. The anticipated costs and construction periods are based
      upon budgets, conceptual design documents and construction schedule estimates
      prepared by us in consultation with our architects and contractors.
      Unanticipated cost increases or other factors may result in the estimated
      budgets we use to plan our investment in new facilities not accurately
      forecasting the costs of those facilities, in which case our operating results
      will be adversely impacted by the new projects to a greater degree than we
      initially planned. In addition, if our initial budgets are not accurate, we
      may
      need to pursue additional financing to complete a proposed project, which may
      not be available on favorable terms or at all. For example, prior to our
      execution of a fixed cost contract for the construction of the Edmonton project,
      our construction costs for the project increased from initial estimates by
      approximately $3.5 million ($4.0 million Canadian), or 22.0%. The adverse impact
      on our results of operations resulting from cost overruns on any construction
      projects we undertake may harm our stock or ADC prices.





Construction
      projects entail significant risks, which can cause substantial delays in
      completing a project in addition to increasing the costs of the project. Such
      risks include shortages of materials or skilled labor, unforeseen engineering,
      environmental or geological problems, work stoppages, and weather interference.
      Most of these factors are beyond our control. In addition, difficulties or
      delays in obtaining any of the requisite licenses, permits or authorizations
      from regulatory authorities can increase the cost or delay the completion of
      an
      expansion or development. Significant delays with respect to development
      projects could result in a delay in our ability to recognize revenue from a
      new
      project, even though we would recognize a portion of the development costs
      of
      the project as construction was ongoing. This could adversely affect our results
      of operations.





***Fluctuations
      in currency exchange rates could adversely affect our
      business.***





Our
      facility in Caledon, South Africa represents a significant portion of our
      business, and the revenue generated and expenses incurred by the Caledon
      facility are generally denominated in South African Rand. A decrease in the
      value of the Rand in relation to the value of the U.S. dollar would decrease
      the
      revenue and operating profit from our South African operations when translated
      into U.S. dollars, which would adversely affect our consolidated results and
      could cause the price of our common stock and ADCs to decrease. In addition,
      we
      expect to expand our operations into other countries and, accordingly, we will
      face similar exchange rate risk with respect to the costs of doing business
      in
      such countries as a result of any increases in the value of the U.S. dollar
      in
      relation to the currencies of such countries. We do not currently hedge our
      exposure to fluctuations in the Rand, and there is no guarantee that we will
      be
      able to successfully hedge any future foreign currency exposure.





***The
      loss of key personnel could have a material adverse effect on us.***





We
      are
      highly dependent on the services of Erwin Haitzmann, our Chairman and Co Chief
      Executive Officer, Peter Hoetzinger, our Vice Chairman and Co Chief Executive
      Officer, and other members of our senior management team. Our ability to retain
      key personnel is affected by the competitiveness of our compensation packages
      and the other terms and conditions of employment, our continued ability to
      compete effectively against other gaming companies and our growth prospects.
      The
      loss of the services of any of these individuals could have a material adverse
      effect on our business, financial condition and results of operations.





-
            22
            -
 *Index*





***The
      availability and cost of financing could have an adverse effect on our business.***





We
      intend
      to finance our current and future expansion and renovation projects primarily
      with cash flow from operations, borrowings under our bank credit facility and
      equity or debt financings. If we are unable to finance our current or future
      expansion projects, we will have to adopt one or more alternatives, such as
      reducing or delaying planned expansion, development and renovation projects
      as
      well as capital expenditures, selling assets, restructuring debt, or obtaining
      additional equity financing or joint venture partners, or modifying our bank
      credit facility. These sources of funds may not be sufficient to finance our
      expansion, and other financing may not be available on acceptable terms, in
      a
      timely manner or at all. In addition, our existing indebtedness contains certain
      restrictions on our ability to incur additional indebtedness. If we are unable
      to secure additional financing, we could be forced to limit or suspend
      expansion, development and renovation projects, which may adversely affect
      our
      business, financial condition and results of operations.





***Our
      indebtedness imposes restrictive covenants on us, which limits our operating
      flexibility.***





Our
      revolving credit facility requires us, among other obligations, to maintain
      specified financial ratios and satisfy certain financial tests, primarily
      through our Colorado operating subsidiary, including maximum leverage ratios
      and
      total fixed cost coverages. In addition, our revolving credit facility
      restricts, among other things, our ability to incur additional indebtedness,
      repay indebtedness or amend debt instruments, pay dividends, create liens on
      assets, make investments, make acquisitions, engage in mergers or
      consolidations, make capital expenditures or engage in certain transactions
      with
      subsidiaries and affiliates. If we fail to comply with the restrictions
      contained in our revolving credit facility, the resulting event of default
      could
      result in our lender accelerating the indebtedness under the credit facility.
      These restrictions limit our operating flexibility and may cause us not to
      engage in transactions that we would otherwise consider to be advantageous
      to
      our stockholders.





***Our
      casino management agreements may be terminated at any
      time.*** ****





In
      addition to our casinos in Cripple Creek and Caledon, we currently operate
      casinos on seven cruise ships and the Casino Millennium in Prague. We operate
      the casinos on the cruise ships pursuant to casino concessionaire agreements
      with three different cruise ship charter companies and we operate the Casino
      Millennium in Prague according to a casino services agreement. The contracts
      with the cruise ship operators and the casino services agreement for the
      operation of the Casino Millennium all provide for cancellation with a limited
      notice period in the event of our default under the respective agreements.
      Accordingly, we could lose the revenue stream associated with these contracts
      on
      short notice, which may adversely affect our operating results.





***Energy
      and fuel price increases may adversely affect our costs of operations and our
      revenues.***





Our
      casino properties use significant amounts of electricity, natural gas and other
      forms of energy. While we have not experienced any shortages of energy that
      have
      hampered our operations, the substantial increases in the cost of electricity
      and natural gas in the U.S. may negatively affect our results of operations.
      The
      extent of the impact is subject to the magnitude and duration of the energy
      and
      fuel price increases. Dramatic increases in fuel prices may also adversely
      affect customer visits to our casino properties.





-
            23
            -
 *Index*





***We
      may be required in the future to record impairment losses related to the
      goodwill we currently carry on our balance sheet.***





We
      had
      $8.7 million of goodwill as of December 31, 2005 and $8.8 million of goodwill
      as
      of December 31, 2004. Accounting rules require that we make certain estimates
      and assumptions related to our determinations as to the future recoverability
      of
      the goodwill we report on our balance sheet. If we were to determine that the
      value of the goodwill carried on our balance sheet is impaired, we may be
      required to record an impairment charge to write down the value of our goodwill,
      which would adversely affect our results during the period in which we recorded
      the impairment charge.





***Certain
      anti-takeover measures we have adopted may limit our ability to consummate
      transactions that some of our security holders might otherwise
      support.***





We
      have a
      fair price business combination provision in our certificate of incorporation,
      which requires approval of certain business combinations and other transactions
      by holders of 80% of our outstanding shares of voting stock. We also have
      adopted a stockholder rights plan that allows our stockholders to purchase
      significant amounts of our common stock at a discount in the event any third
      party acquires a significant ownership interest in us or attempts to acquire
      us
      without the approval of our Board of Directors. In addition, our certificate
      of
      incorporation allows our Board of Directors to issue shares of preferred stock
      without stockholder approval. These provisions generally have the effect of
      requiring that any party seeking to acquire us negotiate with our Board of
      Directors in order to structure a business combination with us. This may have
      the effect of depressing the price of our common stock, and may similarly
      depress the price of the ADCs, due to the possibility that certain transactions
      that our stockholders might favor could be precluded by these
      provisions.





***Certain
      provisions in our certificate of incorporation may require one or more holders
      to sell their stock or ADCs to us, even if the holder would not otherwise want
      to divest itself of our common stock or ADCs.***





Gaming
      regulations in various jurisdictions in which we operate impose certain
      restrictions on the equity ownership of licensed casino operators. In order
      to
      facilitate compliance with these regulations and to preserve our ability to
      be
      awarded additional gaming licenses in the future, our certificate of
      incorporation includes a provision which allows our Board of Directors to redeem
      shares of stock (including shares of common stock underlying the ADCs) held
      by
      one or more stockholders to the extent necessary to keep us in compliance with
      existing gaming regulations or to allow us to secure additional gaming licenses.
      As a result, a stockholder or holder of ADCs could be required to sell our
      stock
      at a time when such stockholder or holder of ADCs may consider our securities
      to
      be undervalued or may otherwise not want to sell our securities.





***The
      U.S. Internal Revenue Service or other taxing authorities may assert that we
      owe
      additional taxes.***





The
      U.S.
      Internal Revenue Service ("IRS") is in the process of conducting an examination
      of our U.S. federal income tax returns for the year ended December 31, 2003.
      We
      do not expect a settlement that might result from the audit to be materially
      in
      excess of amounts accrued. We may also be examined by tax authorities in other
      jurisdictions in which we operate. Our Company’s Return of Income: Company and
      Close Corporation filed for South Africa for 2000 and 2001 is being audited
      by
      the South African Revenue Service. We do not expect any settlement that might
      result from this audit to be materially in excess of amounts accrued. In the
      event the IRS or other taxing authorities determine that we have not paid the
      proper amount of income taxes, we may be required to pay additional taxes as
      well as interest, penalties, and fees. Payment of any such amounts could have
      a
      material adverse effect on our results of operations during the period in which
      we make the payments.





-
            24
            -
 *Index*





***Service
      of process and enforceability of certain foreign*** ***judgments*** ***is limited.***





We
      are
      incorporated in the U.S. and a substantial portion of our assets are located
      in
      the U.S. and South Africa. In addition, some of our directors and officers
      named
      in this prospectus are residents of the U.S. and all or a substantial portion
      of
      their assets are located in the U.S. As a result, it may be difficult for
      European investors who hold ADCs to effect service of process within Austria
      upon the Company or such persons or to enforce judgments obtained
      against them in such courts based on civil liability provisions of the European
      securities laws.





***Outside
      investors own preference shares in our Caledon, South Africa operation, which
      may reduce our return on investment from that property.***





Century
      Resorts Limited (“CRL”) owns 100% of the common equity of CCAL, our South
      African subsidiary that owns and operates the Caledon Hotel, Spa and Casino.
      Unrelated third parties own preference shares that entitle them to a priority
      on
      distributions in certain circumstances. The preference shares are not
      cumulative, nor are they redeemable. The preference shares entitle the holders
      of such shares to dividends of 20% of the after-tax profits of each financial
      year directly attributable to the Caledon casino business in that year, subject
      to, as determined by the directors of CCAL in their sole and absolute
      discretion, any working capital, capital expenditure requirements, loan
      obligations and liabilities attributable to the casino business. Although no
      dividends have been paid out so far, these dividend rights would reduce the
      return that we would otherwise receive from our investment in this property.
      Furthermore, should the casino business be sold or otherwise dissolved, the
      preferred shareholders would be entitled to 20% of any surplus directly
      attributable to the casino business, net of all liabilities attributable to
      the
      casino business.




In
      January 2006, CCAL authorized a new class of preferred shares with a lower
      dividend rate and liquidation preference than the existing class of preferred
      shares, and CCAL is offering the new class of preferred shares for the shares
      currently outstanding. However, the existing shareholders may elect not to
      exchange their shares, and in that case would retain the preferred shares with
      the 20% dividend rate and liquidation preference.


**Risks
      Related to our Common Stock and the ADCs**





***We
      do not anticipate paying cash dividends on our shares of common stock or ADCs
      in
      the foreseeable future.***





We
      have
      never declared or paid any cash dividends on our shares of common stock. We
      intend to retain any future earnings to fund the operation and expansion of
      our
      business and, therefore, we do not anticipate paying cash dividends on our
      shares of common stock, or the ADCs, in the foreseeable future. Our revolving
      credit facility prohibits us from paying cash dividends on our shares of common
      stock if payment of such dividends would cause us to violate financial covenants
      stated in the credit agreement.





***Our
      stock price has been volatile and may decline significantly and unexpectedly.***





Our
      common stock trades in the U.S. on the NASDAQ Capital Market, which is
      characterized by small issuers and a lack of significant trading volumes
      relative to other U.S. markets. These factors may result in volatility in the
      price of our common stock. For instance, the trading price of our common stock
      on the NASDAQ Capital Market varied from a low of $6.02 to a high of $10.91
      during 2005. Our common stock also trades on the Vienna Stock Exchange in the
      form of ADCs. For a small company such as ours, having listings on two
      securities markets could decrease the trading volume on each market to levels
      that might increase the volatility of the trading price of our securities.
      Increased trading focus of our securities on one trading market could affect
      and
      significantly decrease the liquidity on the other market, which could make
      it
      difficult or impossible for an investor to sell our common stock or ADCs on
      the
      market with declining value.





-
            25
            -
 *Index*





***Investors
      in our ADCs will not have, and our stockholders do not have, any preemptive
      rights relating to future issues of ADCs or shares of our common
      stock.***





Neither
      the Delaware General Corporation Law nor our certificate of incorporation
      provides for statutory preemptive rights for stockholders or ADC holders.
      Therefore, in the event we decide to issue further shares or other securities
      our existing stockholders and our ADC holders will not have statutory preemptive
      rights to purchase such shares or other securities.





***Because
      we are a foreign corporation to the Vienna Stock Exchange, the Austrian and
      other European takeover regimes do not apply to our
      company.***





Austrian
      takeover law does not apply to foreign corporations listed on the Vienna Stock
      Exchange. Should an investor decide to take over our Company, Delaware law
      (including laws relating to the enforceability of our stockholder rights plan)
      would apply, and neither our stockholders nor our ADC holders could rely on
      the
      Austrian or any other European takeover regime to apply to such a takeover.
      As a
      result, if you are a holder of ADCs you may be forced to sell the ADCs at a
      price that is less than you paid or that is less than you otherwise would
      accept.





***Investors
      whose currency is not denominated in the same currency as to which their common
      stock or ADCs are traded will incur exposure to fluctuating exchange
      rates.***





For
      investors whose currency is not denominated in the same currency as to which
      their common stock or ADCs are traded, fluctuations in the value of the common
      stock or ADCs currency against the investor’s currency will affect the market
      value of our shares and the ADCs, expressed in the investor’s currency. In
      addition, such fluctuations may also affect the conversion into the investor’s
      currency of cash dividends and other distributions paid on our shares and ADCs,
      if any, including proceeds received upon a sale or other disposition of our
      common stock and ADCs.





**Item
                1B.**
            **Unresolved
                Staff Comments.**





None.





-
            26
            -
 *Index*





**Item
                2.**
            **Properties.**





**Summary
      of Property Information**





**Property**
            
            **Casino****Space****Sq
                Ft (1)**
            
            **Acreage**
            
            **Number****of
                Slot****Machines**
            
            **Number****of
                Table****Games**
            
            **Number****of
                Hotel****Rooms**
            
            **Number
                of****Restaurants**Womacks
            
            
            23,000
            
            
            3.5
            
            
            590
            
            
            6
            
            
            21
            
            
            1Caledon
            
            
            13,660
            
            
            600
            
            
            350
            
            
            9
            
            
            81
            
            
            3Casino
                Millennium(2)
            
            
            6,200
            
            
            -
            
            
            38
            
            
            16
            
            
            -
            
            
            -Cruise
                Ships (total of seven)(3)
            
            
            6,770
            
            
            -
            
            
            180
            
            
            28
            
            
            -
            
            
            -





(1)
            Approximate.


(2)
            Operated
                under a casino services agreement. In January 2004, we purchased
                40% of
                the operation, bringing our ownership interest to 50% as of that
                date.


(3)
            Operated
                under concession agreements.





*Cripple
      Creek, Colorado, United States*





We
      own
      approximately 3.5 acres in Cripple Creek, Colorado used in connection with
      the
      operations of Womacks Casino and Hotel which includes buildings and parking
      spaces related to our casino and hotel operations. This property is
      collateralized by a first mortgage held by Wells Fargo Bank in connection with
      our revolving credit facility. See Note 6, “Long-Term Debt”, to the Consolidated
      Financial Statements for further information.





We
      lease
      10 city lots from the City of Cripple Creek, Colorado for parking. The lease
      terms include annual rental payments of approximately $0.1 million and an
      expiration date of May 31, 2010. The agreement contains a purchase option for
      us
      to purchase the property for $3.3 million, less cumulative lease payments,
      at
      any time during the remainder of the lease term.





*Central
      City, Colorado, United States*





We
      own a
      65% interest in a venture that owns approximately 1.1 acres in Central City,
      Colorado to be used for the development of a casino, hotel and parking garage.
      All together, the new development is expected to contain approximately 60,000
      square feet of casino and back of house and 500 parking spaces within a 155,000
      square feet, four story, parking structure.





*Caledon,
      South Africa*





We
      own
      approximately 600 acres in Caledon, South Africa. This property contains a
      180,000 square foot building for our casino, hotel and spa operations and is
      collateralized by a first mortgage bond over land, buildings and equipment
      held
      by Nedbank Limited of South Africa. Approximately 500 acres of this property
      is
      undeveloped at this time.





*Edmonton,
      Alberta, Canada*





Effective
      January 2006, we own 100% of the project in Edmonton, Alberta, Canada. The
      project is on a 7.25 acre facility site and when completed is expected to
      include a casino with 600 slot machines and approximately 31 table games, food
      and beverage amenities, a dinner theatre, a 300 space underground parking garage
      and a 26-room hotel.





-
            27
            -
 *Index*





*Corporate
      Offices*





We
      currently lease office spaces for corporate and administrative purposes in
      Colorado Springs, Colorado; Vienna, Austria; and Cape Town, South
      Africa.





In
      the
      opinion of management, the space and equipment owned or leased by the Company
      are adequate for existing operating needs.





**Item
                3.**
            **Legal
                Proceedings.**





We
      are
      not a party to, nor are we aware of, any pending or threatened litigation which,
      in management’s opinion, could have a material adverse effect on our financial
      position or results of operations.





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





No
      matters were submitted to a vote of security holders during the fourth quarter
      of the fiscal year ended December 31, 2005.





-
            28
            -
 *Index*




**PART
      II**





**Item
                5.**
            **Market
                for Registrant’s Common Equity, Related Stockholder Matters and Issuer
                Purchases of Equity
                Securities.**





Our
      common stock began trading on the NASDAQ Capital Market on November 10, 1993.
      The following table sets forth the low and high sale price per share quotations
      of the common stock as reported on the NASDAQ Capital Market for the periods
      indicated. These quotations reflect inter-dealer prices, without retail markup,
      markdown or commission and may not necessarily represent actual transactions.
      Actual prices may vary.





Quarter
                Ended
            
            Low
            
            HighMarch
                31, 2004
            
            $
            2.76
            
            $
            3.50June
                30, 2004
            
            $
            3.26
            
            $
            6.30September
                30, 2004
            
            $
            3.75
            
            $
            6.20December
                31, 2004
            
            $
            5.27
            
            $
            9.97March
                31, 2005
            
            $
            7.08
            
            $
            9.62June
                30, 2005
            
            $
            6.25
            
            $
            10.91September
                30, 2005
            
            $
            6.02
            
            $
            7.82December
                31, 2005
            
            $
            6.80
            
            $
            8.96





In
      October 2005, we issued 7,132,667 new shares of our common stock, in the form
      of
      Austrian Depositary Certificates (“ADCs”), to retail and institutional investors
      in the Republic of Austria and in a private placement to institutional investors
      in Europe outside of the Republic of Austria. Each ADC, which is traded on
      the
      Vienna Stock Exchange, is equivalent to one share of our common stock. For
      the
      quarter ended December 31, 2005, the market price of the ADCs ranged from a
      low
      of €5.78 ($6.90 on October 11, 2005) to a high of €7.65 ($9.12 on December 13,
      2005) (Source: Wiener B ö rse).




At
        December 31, 2005, we had approximately 68 ****** holders
        of record of our common stock. We estimate that the number of beneficial
        owners
        is approximately 2,570. At this time, there is an indeterminate number of
        beneficial owners of our common stock represented by ADCs trading on the
        Vienna
        Stock Exchange.





At
      the
      present time, we intend to use any earnings that may be generated to finance
      the
      growth of the Company’s business. Our credit facilities currently limit the
      payment of dividends. No dividends have been declared or paid by the Company,
      and we do not presently intend to pay dividends.





-
            29
            -
 *Index*





The
      following table provides the information as of December 31, 2005 relating to
      securities authorized for issuance under equity compensation plans.





Plan
                category
            
            Number
                of securities tobe
                issued upon exerciseof
                outstanding options,warrants
                and rights
            
            Weighted-average
                exerciseprice
                of outstandingoptions,
                warrants and rights
            
            Number
                of securitiesremaining
                available forfuture
                issuance underequity
                compensationplans
                (excluding
              securities
                underlyingoutstanding
                options,warrants
                and rights)Equity
                compensation plans approved by security holders
            
            
            1,986,210
            
            
            $2.33
            
            
            1,965,000Equity
                compensation plans not approved by security holders
            
            
            -
            
            
            -
            
            
            -Total
            
            
            1,986,210
            
            
            $2.33
            
            
            1,965,000





The
      Board
      of Directors of the Company adopted an Employees’ Equity Incentive Plan (the
“EEIP”) in April 1994, which expired in April 2004. The EEIP continues to be
      administered for previously issued and outstanding options. Stockholders
      approved a new equity incentive plan (the “2005 Plan”) at the 2005 annual
      meeting. The 2005 Plan provides for the grant of awards to eligible individuals
      in the form of stock, restricted stock, stock options, performance units or
      other stock-based awards, all as defined in the 2005 Plan. The 2005 Plan
      provides for the issuance of up to 2,000,000 shares of common stock to eligible
      individuals through the various forms of awards permitted. The 2005 Plan limits
      the number of options that can be awarded to an individual to 200,000 per year.
      Stock options may not be issued at an option price lower than fair market value
      at the date of grant. All stock options must have an exercise period not to
      exceed ten years. Through December 31, 2005, only incentive stock option awards,
      for which the option price may not be less than fair market value at the date
      of
      grant, or non-statutory options, which may be granted at any option price (as
      permitted under the EEIP), have been granted under the EEIP and 2005 Plan.
      Options granted to date have one-year, two-year or four-year vesting periods.
      The Company’s Incentive Plan Committee has the power and discretion to, among
      other things, prescribe the terms and conditions for the exercise of, or
      modification of, any outstanding awards in the event of merger, acquisition
      or
      any other form of acquisition other than a reorganization of the Company under
      United States Bankruptcy Code or liquidation of the Company. Both plans also
      allow limited transferability of any non-statutory stock options to legal
      entities that are 100% - owned or controlled by the optionee or to the
      optionee’s family trust. As of December 31, 2005 there were 1,986,210 options
      outstanding, of which 1,951,210 options were issued under the EEIP and 35,000
      options have been issued under the 2005 Plan.





-
            30
            -
 *Index*





**Item
                6.**
            **Selected
                Financial Data.**





The
      selected financial data below should be read in conjunction with Part II, Item
      7, “Management’s Discussion and Analysis of Financial Condition and Results of
      Operations”, and Part II, Item 8, “Financial Statements and Supplementary Data”,
      of this Form 10-K.





**For
                the Year Ended December 31,***Amounts
                shown in thousands except for share information*
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2002**
            
            **2001**(1)**Results
                of Operations:**Net
                Operating Revenue
            
            $
            37,445
            
            $
            35,765
            
            $
            31,430
            
            $
            29,337
            
            $
            29,456Net
                Earnings (2) (3) (7)
            
            
            4,481
            
            
            4,738
            
            
            3,246
            
            
            3,079
            
            
            2,455Net
                Earnings per Share:Basic
            
            $
            0.28
            
            $
            0.35
            
            $
            0.24
            
            $
            0.23
            
            $
            0.18Diluted
            
            $
            0.25
            
            $
            0.30
            
            $
            0.22
            
            $
            0.20
            
            $
            0.16**Balance
                Sheet:**Cash
                and Cash Equivalents (6)(8)
            
            $
            37,167
            
            $
            8,411
            
            $
            4,729
            
            $
            4,582
            
            $
            3,031Total
                Assets (4) (8)
            
            
            123,563
            
            
            71,204
            
            
            54,817
            
            
            51,143
            
            
            44,819Long-Term
                Debt
            
            
            17,934
            
            
            17,970
            
            
            14,913
            
            
            16,531
            
            
            15,991Total
                Liabilities (6)
            
            
            32,232
            
            
            30,825
            
            
            21,769
            
            
            24,040
            
            
            22,641Total
                Shareholders’ Equity (8)
            
            
            91,331
            
            
            40,379
            
            
            33,048
            
            
            27,103
            
            
            22,178Cash
                Dividends Per Common Share (5)
            
            $
            --
            
            $
            --
            
            $
            --
            
            $
            --
            
            $
            --





(1)
            In
                January 2003, we, through CCA, acquired the remaining 35% interest
                in
                CCAL.





(2)
            Effective
                2002, in accordance with SFAS No. 142, we no longer amortize goodwill
                and
                other intangible assets with indefinite useful lives. The goodwill
                amortization expense, net of income taxes, for the year ended December
                31,
                2001 was $1.2 million.





(3)
            In
                2002, we wrote down the value of the non-operating casino property
                and
                land held for sale in Nevada by approximately $0.5 million and recorded
                an
                approximate $0.4 million write-off for advances made and pre-construction
                costs incurred in conjunction with the Gauteng project and an approximate
                $0.3 million write-off for unpaid casino technical service fees from
                Casino Millennium.





(4)
            In
                2004, the increase in total assets is primarily the result of the
                contribution of $9.2 million in land and buildings to the Central
                City
                project by the minority partner, approximately $3 million in capital
                improvements at Womacks, including new slot machines and new slot
                accounting software and increases in foreign denominated assets resulting
                from fluctuations in currency exchange rates.





(5)
            We
                have not declared any cash dividends on our common stock and do not
                expect
                to pay any such dividends in the foreseeable
                future.





(6)
            Approximately
                $3.5 million was borrowed against the Wells Fargo revolving credit
                facility on December 30, 2004 to finance our cash contribution to
                the
                Central City Project. A $4.2 million increase in the minority interest
                liability in 2004 is directly related to the Central City
                project.





(7)
            In
                2004, we recovered approximately $0.2 million in receivables that
                had been
                written off in 2002 and a foreign currency gain of $0.4 million recognized
                on the disposition of Verkrans.





(8)
            In
                2005, we raised $46.2 million in net proceeds by way of a stock offering
                on the Vienna Stock Exchange. As of December 31, 2005, cash and cash
                equivalents includes $26.2 million from the stock offering.





-
            31
            -
 *Index*





**Item
                7.**
            **Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations.**





The
      following discussion should be read in conjunction with “Item 8. Financial
      Statements and Supplementary Data” included elsewhere herein. Information
      contained in the following discussion of results of operations and financial
      condition of the Company contains forward-looking statements within the meaning
      of Section 21E of the Securities and Exchange Act of 1934, and as such, are
      based on current expectations and are subject to certain risks and
      uncertainties. The reader should not place undue reliance on these
      forward-looking statements for many reasons including those risks discussed
      under Item 1A, “Risk Factors,” and elsewhere in this document. Forward-looking
      statements may be identified by the use of forward-looking words or phrases
      such
      as “may,” “will,” “believe,” “expect,” “intend,” “anticipate,” “could,”
“should,” “plan,” “estimate,” “potential” or “continue”, or variations thereon
      or comparable terminology. In addition, all statements other than statements
      of
      historical facts are forward-looking statements.





**Results
      of Operations**





*Overview*





Since
      our
      inception, we have been primarily engaged in developing and operating gaming
      establishments and the related lodging and restaurant facilities. We derive
      revenue from the net proceeds of our gaming machines and tables, and from hotel
      and restaurant facilities.





We
      are
      managed in six segments: (i) Cripple Creek, Colorado, the operations of Womacks
      Casino and Hotel; (ii) Central City, Colorado, the development of a new casino,
      (iii) Edmonton, Canada, the development of a new casino, (iv) South Africa,
      primarily related to the operations of the Caledon Hotel, Spa and Casino; (v)
      cruise ship casino operations for several vessels; and (vi) Corporate and other
      operations including corporate gaming projects for which we have long-term
      service contracts.





We
      continue to experience strong competition in both our Cripple Creek, Colorado
      and South African segments. We face competition in both segments from both
      larger and smaller casinos in the area. In our Cripple Creek, Colorado segment
      two of our competitors provide covered parking garages adjacent to their
      facilities which provide them with an advantage during inclement weather and
      peak tourist season. We continue to aggressively market in both Cripple Creek,
      Colorado and South Africa, primarily through the use of our player’s club
      programs.





**Results
      of Operations for the Years ended December 31, 2005, 2004 and 2003**





We
      reported net operating revenue of $37.5 million for the year ended December
      31,
      2005, compared to $35.8 million in 2004 and $31.4 million in 2003. For 2005,
      2004 and 2003, Womacks represented 46%, 49% and 59% of total net operating
      revenue, respectively, while Caledon represented 45%, 42% and 36% for the same
      periods.





Casino
      revenue increased $1.8 million, or 5.1%, to $36.4 million in 2005 as compared
      to
      2004. Casino revenue in 2004 increased $2.8 million, or 8.7%, to $34.6 million
      as compared to 2003. These increases are primarily the result of gains made
      in
      the South African market. Hotel, food and beverage revenue increased $0.2
      million, or 4.6%, to $4.5 million during 2005 as compared to 2004. Hotel, food
      and beverage revenue increased $0.8 million or 21.1% to $4.3 million in 2004
      as
      compared to 2003. The increases in hotel, food and beverage revenue during
      the
      three year period is primarily attributable to renovating and relocating certain
      restaurant facilities in Cripple Creek, Colorado and increased theme dinners
      and
      banquets at our South Africa property. Other revenue decreased by $0.3 million
      or 28.3% to $0.8 million in 2005 as compared to 2004. The higher revenue in
      2004
      is primarily due to the foreign currency gain of $0.4 million recognized on
      the
      disposition of Verkrans. Other revenue increased by $0.4 million or 69.2% to
      $1.1 million in 2004 as compared to 2003, primarily as the result of the foreign
      currency gain recognized on the disposition of Verkrans. Promotional allowances,
      which are made up of complimentary revenue, cash points and coupons, are rewards
      we give our loyal customers to encourage them to continue to patronize our
      properties. Such awards reduced gross revenues by approximately 10% in 2005,
      11%
      in 2004 and 13% in 2003.





-
            32
            -
 *Index*





Casino
      operating expenses were $14.3 million, $13.8 million and $11.7 million for
      2005,
      2004 and 2003, respectively. The increase of $0.5 million, or 3.9%, from 2005
      to
      2004 is primarily the result of revenue growth and currency exchange rate
      fluctuations in the South African segment. Casino operating expenses in 2004
      increased $2.1 million, or 17.9%, as compared to 2003 primarily due to growth
      in
      the South African and ship segments and fluctuation in the currency exchange
      rate.





Hotel,
      food and beverage expenses were $2.8 million in 2005, $3.1 million in 2004
      and
      $2.6 million in 2003. The decrease of $0.3 million from 2004 to 2005 resulted
      from a decrease in hotel occupancy in the South African segment. Hotel, food
      and
      beverage expenses increased $0.5 million, from 2003 to 2004 because of the
      corresponding increase in food and beverage revenues generated at additional
      outlets opened or expanded between 2003 and 2004.





General
      and administrative expenses were $11.1 million in 2005 compared to $8.9 million
      in 2004 and $7.7 million in 2003. The $2.0 million increase in general and
      administrative expenses in 2005 was due primarily to the implementation of
      section 404 of the Sarbanes-Oxley Act of 2002 and staff additions to aid in
      its
      implementation, coupled with expenditures associated with the development of
      the
      Central City and Edmonton projects. General and administrative expenses
      increased $1.4 million in 2004 over 2003 primarily as a result of staff
      increases at the corporate level to support the expansion efforts and compliance
      requirements, expenditures incurred in conjunction with new Company projects
      and
      the effect of foreign currency fluctuations, primarily the Rand.





Depreciation
      expense was $3.3 million in 2005, $3.0 million in 2004 and $2.7 million in
      2003.
      Changes in depreciation expenses during the three year period ended December
      31,
      2005 relate to on-going property improvement projects.





Our
      earnings from operations for the year ended December 31, 2005 were $5.8 million
      compared to $7.0 million in 2004 and $6.8 million in 2003. Earnings from
      operations decreased $1.2 million, or 16.6% in 2005, primarily as a result
      of a
      decrease in earnings in Cripple Creek, Colorado, the increase in expenditures
      at
      the Corporate & Other segment associated with the Sarbanes-Oxley section 404
      implementation, and the addition of expenditures associated with the Central
      City, Colorado and Edmonton, Canada development projects. The change from 2003
      to 2004 is primarily a result of an increase in earnings from operations in
      Caledon, the gain recognized on the sale of Verkrans and the recovery of
      receivables from the sale of our interest in Gauteng, South Africa offset by
      a
      decrease in earnings from operations in Cripple Creek, Colorado.





Interest
      expense was $2.3 million in 2005, $1.6 million in 2004 and $2.0 million in
      2003
      and results primarily from our credit facilities with Wells Fargo and the
      outstanding notes to Nedbank Limited and ABSA Bank in South Africa. Please
      see
      Note 6, “Long-term Debt” of the Notes to Consolidated Financial Statements for
      further information.





Income
      tax expense was $0.3 million for 2005 compared to $0.7 million in 2004 and
      $1.8
      million in 2003. The decrease in the tax expense is the result of a reduction
      in
      pre-tax earnings and the tax benefit recognized on the exercise of non-statutory
      stock options in 2005. The decrease of $1.1 million in 2004 as compared to
      2003
      is primarily related to the inclusion of management fees paid by our South
      African operations to their Mauritian parent in 2004, which are taxed at a
      rate
      of 3%. In 2004, approximately $2.1 million of our pre-tax income totaling $5.2
      million is attributable to our Mauritian subsidiary and was taxed at an
      effective rate of 3%.





-
            33
            -
 *Index*





Our
      net
      earnings for 2005 were $4.5 million, or $0.28 per share compared to net earnings
      of $4.7 million, or $0.35 per share in 2004 and $3.2 million, or $0.24 per
      share
      in 2003. The additional shares issued in conjunction with the ADC offering
      in
      October 2005 diluted the reported earnings per share for 2005 by
      $0.03.





A
      discussion by business segment follows below.





**Cripple
      Creek, Colorado Segment**





The
      operating results of the Cripple Creek, Colorado segment, primarily the
      operations of Womacks, for the years ended December 31, 2005, 2004 and 2003
      are
      as follows:





*Dollar
                amounts shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**
            
            **%
                Change**
              **2005
                v. 2004**
            
            **%
                Change**
              **2004
                v. 2003**Operating
                RevenueCasino
            
            $
            18,934
            
            $
            19,486
            
            $
            20,981
            
            
            -2.8
            %
            
            -7.1
            %Hotel,
                food and beverage
            
            
            1,472
            
            
            1,544
            
            
            1,267
            
            
            -4.7
            %
            
            21.9
            %Other
                (net of promotional allowances)
            
            
            (3,295
            )
            
            (3,469
            )
            
            (3,818
            )
            
            -5.0
            %
            
            -9.1
            %Net
                operating revenue
            
            
            17,111
            
            
            17,561
            
            
            18,430
            
            
            -2.6
            %
            
            -4.7
            %Costs
                and ExpensesCasino
            
            
            6,514
            
            
            6,828
            
            
            6,702
            
            
            -4.6
            %
            
            1.9
            %Hotel,
                food and beverage
            
            
            619
            
            
            586
            
            
            357
            
            
            5.6
            %
            
            64.1
            %General
                and administrative
            
            
            3,804
            
            
            3,641
            
            
            3,686
            
            
            4.5
            %
            
            -1.2
            %Depreciation
            
            
            1,703
            
            
            1,512
            
            
            1,349
            
            
            12.6
            %
            
            12.1
            %12,640
            
            
            12,567
            
            
            12,094
            
            
            0.6
            %
            
            3.9
            %Earnings
                from operations
            
            
            4,471
            
            
            4,994
            
            
            6,336
            
            
            -10.5
            %
            
            -21.2
            %Interest
                income
            
            
            13
            
            
            12
            
            
            12
            
            
            8.3
            %
            
            -
            %Interest
                (expense)
            
            
            (1,066
            )
            
            (784
            )
            
            (1,059
            )
            
            36.0
            %
            
            -26.0
            %Interest
                expense on non-Cripple Creek debt allocated to Corporate and Other
                Segment
            
            
            1,325
            
            
            907
            
            
            1,058
            
            
            46.1
            %
            
            -14.3
            %Other
                income, net
            
            
            -
            
            
            -
            
            
            2
            
            
            -
            %
            
            -100.0
            %Earnings
                before income taxes
            
            
            4,743
            
            
            5,129
            
            
            6,349
            
            
            -7.5
            %
            
            -19.2
            %Income
                tax expense
            
            
            1,802
            
            
            1,949
            
            
            2,413
            
            
            -7.5
            %
            
            -19.2
            %**Net
                Earnings**
            ****
            **$**
            **2,941**
            ****
            **$**
            **3,180**
            ****
            **$**
            **3,93**6
            
            
            **-7.5**
            **%**
            
            **-19.2**
            **%**





Overall
      operating results for the segment were impacted by the casino results detailed
      below.





**Market
      Data**





**2005**
            
            **2004**
            
            **2003**Market
                share of the Cripple Creek Slot AGP
            
            
            12.8
            %
            
            13.4
            %
            
            14.9
            %Average
                number of slot machines
            
            
            618
            
            
            649
            
            
            622Market
                share of Cripple Creek gaming devices
            
            
            13.0
            %
            
            14.1
            %
            
            14.7
            %Average
                slot machine win per day
            
            
            83
                dollars
            
            
            81
                dollars
            
            
            91
                dollarsCripple
                Creek average slot machine win per day
            
            
            84
                dollars
            
            
            85
                dollars
            
            
            90
                dollars





When
      comparing 2005 to 2004, the Cripple Creek market grew by 1.6%. Management
      continues to focus on the marketing of the Womacks Casino through the Gold
      Club.
      Womacks’ market share of slot AGP decreased in 2005 by 4.5%, primarily due to
      increasing competition within the market. Womacks has continued the effort
      to
      improve the customer experience by converting 323 slot machines, over 50% of
      the
      total machines on the floor, to cashless gaming devices. These ongoing
      improvements are expected to further improve customer service.





-
            34
            -
 *Index*





During
      this period, the relative percentage of personnel cost and the cost of
      participation machines to net operating revenue contributed to the erosion
      in
      earnings from operations. Management regularly evaluates these overhead costs
      to
      maintain a satisfactory cost benefit relationship.





When
      comparing 2004 to 2003, the Cripple Creek market grew by 4.3%. In December
      2003
      and in June 2004, additional casinos opened in Cripple Creek, bringing the
      total
      number of casino licenses to 19 as of December 31, 2004 compared to 17 for
      the
      majority of 2003 and reduced Womacks’ market share of gaming devices by 5%. We
      spent approximately $3 million in 2004 to upgrade the product mix on the gaming
      floor, improve the player tracking system and introduce cashless gaming
      machines. During 2004, Womacks replaced approximately 149 slot machines and
      added 20 slot machines on the floor.





In
      order
      to outfit Womacks with the most popular gaming machines, Womacks leased
      approximately 35 slot machines from manufacturers in 2005, compared to 39 in
      2004 and an average of 37 in 2003, on which it pays a fee calculated as a
      percentage of the net win. All of the leases have short term commitment periods
      not exceeding three months and are classified as operating leases. The leases
      can be cancelled with no more than 30 days written notice. On a portion of
      the
      leases, the manufacturer is guaranteed a minimum fee per day that can range
      from
      15 dollars to 35 dollars for the duration of the lease. In most instances,
      the
      branded games that are being introduced to the market are not available for
      purchase. For financial reporting purposes, the net win on the slot machines
      is
      included in our revenue and the amount due to the manufacturer is recorded
      as an
      expense, in the period during which the revenue is earned, as casino operating
      cost. Management makes its decisions to introduce these machines based on the
      consumer demand for the product. The amount paid under these agreements was
      $0.5
      million, $0.5 million and $0.4 million in 2005, 2004 and 2003,
      respectively.





**Hotel,
      Food and Beverage**





When
      comparing 2005 and 2004, hotel revenue, included in hotel, food and beverage
      revenue, decreased by 7.6% as a result of decrease in the hotel occupancy to
      83%
      from 92% in 2004. Hotel occupancy decreased due to a restructuring of the player
      comp policy. When comparing 2004 and 2003, hotel, food and beverage revenue
      increased by 21.9%, as a result of an increase in the hotel occupancy rate
      to
      92% in 2004 from 85% in 2003, and the opening of an additional food outlet.
      All
      of the revenue generated by the hotel operations is derived from comps to better
      players, the value of which is included in promotional allowances.




Womacks
        operated two restaurants, “Bob’s Grill” and the “Cut Above Buffet” to provide an
        alternative to patrons of the casino. The “Cut Above Buffet” was opened in May
        2004 and operated on the second floor of the casino. As a means to attracting
        new customers, the “Cut Above Buffet” was operated at a lower food and beverage
        operating margin than “Bob’s Grill”. Although the “Cut Above Buffet” attracted
        new customers to Womacks Gold Club, it was not a significant stimulus to
        gaming
        revenue, resulting in its closure on July 30, 2005.





**Other**





Comparing
      2005 to 2004, Womacks casino incurred approximately $0.1 million in fees from
      consultants that assisted in the implementation of Sarbanes-Oxley section 404
      controls, but was otherwise able to limit increases in administrative expenses.
      Comparing 2004 to 2003, we were able to control general and administrative
      costs
      through effective cost control measures.





The
      $0.2
      million increase in depreciation expense when comparing 2005 to 2004 is
      primarily the result of the addition of gaming equipment during 2004. The $0.2
      million increase in depreciation expense when comparing 2004 to 2003 results
      from an increase of approximately $0.2 million in depreciation on new additions
      less the reduction in depreciation on assets that are fully depreciated.





-
            35
            -
 *Index*





The
      segment allocated $1.3 million, $0.9 million and $1.1 million in net interest
      expense to the Corporate & Other segment during the years ended December 31,
      2005, 2004 and 2003, respectively. Interest expense on the amounts advanced
      by
      Womacks, but not repaid, to fund the Company’s acquisitions and the repurchase
      of the Company’s common stock is calculated using the effective rate on all
      borrowings under Womacks’ revolving credit facility. In December 2005, CCI
      repaid these funds to Womacks.





The
      Cripple Creek, Colorado segment recognized income tax expense of $1.8 million
      in
      2005 versus $1.9 million in 2004, and $2.4 million in 2003, principally the
      result of a decrease in earnings before income taxes. The effective tax rate
      has
      remained stable at 38% over the three year period.





-
            36
            -
 *Index*





**South
      African Segment**





The
      operating results of the South African segment are primarily those related
      to
      the operations of the Caledon Hotel, Spa and Casino. Intercompany transactions,
      including fees to its Mauritian parent, shareholder’s interest and their related
      tax effects have been eliminated within the segment’s results. Improvement in
      the Rand versus the dollar when comparing 2005 to 2004 and 2004 to 2003 has
      had
      a positive impact on the reported revenues and a negative impact on expenses.
      Operational results in US dollars for the years ended December 31, 2005, 2004
      and 2003 are as follows: (See next page for results in Rand).





**CALEDON**





*Amounts
                shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**
            
            **%
                Change**
              **2005
                v. 2004**
            
            **%
                Change**
              **2004
                v. 2003**Operating
                RevenueCasino
            
            $
            14,549
            
            $
            12,540
            
            $
            9,211
            
            
            16.0
            %
            
            36.1
            %Hotel,
                food and beverage
            
            
            3,050
            
            
            2,778
            
            
            2,301
            
            
            9.8
            %
            
            20.7
            %Other
                (net of promotional allowances)
            
            
            (584
            )
            
            (348
            )
            
            (363
            )
            
            67.8
            %
            
            -4.1
            %Net
                operating revenue
            
            
            17,015
            
            
            14,970
            
            
            11,149
            
            
            13.7
            %
            
            34.3
            %Costs
                and ExpensesCasino
            
            
            5,637
            
            
            5,096
            
            
            3,993
            
            
            10.6
            %
            
            27.6
            %Hotel,
                food and beverage
            
            
            2,157
            
            
            2,548
            
            
            1,996
            
            
            -15.3
            %
            
            27.7
            %General
                and administrative
            
            
            2,529
            
            
            2,170
            
            
            1,552
            
            
            16.5
            %
            
            39.8
            %Depreciation
            
            
            1,471
            
            
            1,343
            
            
            1,070
            
            
            9.5
            %
            
            25.5
            %11,794
            
            
            11,157
            
            
            8,611
            
            
            5.7
            %
            
            29.6
            %Earnings
                from operations
            
            
            5,221
            
            
            3,813
            
            
            2,538
            
            
            36.9
            %
            
            50.2
            %Interest
                income
            
            
            51
            
            
            112
            
            
            161
            
            
            -54.5
            %
            
            -30.4
            %Interest
                expense
            
            
            (651
            )
            
            (788
            )
            
            (929
            )
            
            -17.4
            %
            
            -15.2
            %Early
                debt repayment expense
            
            
            (181
            )
            
            -
            
            
            -
            
            
            100.0
            %
            
            -
            %Loss
                on foreign currency translation
            
            
            -
            
            
            -
            
            
            (7
            )
            
            -
            %
            
            100.0
            %Earnings
                before income taxes
            
            
            4,440
            
            
            3,137
            
            
            1,763
            
            
            41.5
            %
            
            77.9
            %Income
                tax expense
            
            
            1,308
            
            
            943
            
            
            581
            
            
            38.7
            %
            
            62.3
            %**Net
                Earnings**
            
            **$**
            **3,132**
            ****
            **$**
            **2,194**
            ****
            **$**
            **1,182**
            ****
            ****
            **42.8**
            **%**
            ****
            **85.6**
            **%**





**CENTURY
      CASINOS AFRICA**





Operating
                RevenueOther
                (including promotional allowances) (1)
            
            $
            -
            
            $
            364
            
            $
            -
            
            
            -100.0
            %
            
            100.0
            %Net
                operating revenue
            
            
            -
            
            
            364
            
            
            -
            
            
            -100.0
            %
            
            100.0
            %Costs
                and ExpensesGeneral
                and administrative
            
            
            196
            
            
            161
            
            
            352
            
            
            21.7
            %
            
            -54.3
            %Recovery
                of receivables previously written off
            
            
            -
            
            
            (175
            )
            
            -
            
            
            -100.0
            %
            
            100.0
            %Depreciation
            
            
            2
            
            
            -
            
            
            3
            
            
            100.0
            %
            
            -100.0
            %198
            
            
            (14
            )
            
            355
            
            
            1514.3
            %
            
            -103.9
            %Loss
                from operations
            
            
            (198
            )
            
            378
            
            
            (355
            )
            
            -152.4
            %
            
            206.5
            %Interest
                expense, net
            
            
            (32
            )
            
            -
            
            
            -
            
            
            100.0
            %
            
            -
            %Other
                income, net
            
            
            147
            
            
            39
            
            
            28
            
            
            276.9
            %
            
            39.3
            %Loss
                before income taxes
            
            
            (83
            )
            
            417
            
            
            (327
            )
            
            -119.9
            %
            
            227.5
            %Income
                tax (benefit)
            
            
            (53
            )
            
            (37
            )
            
            (94
            )
            
            43.2
            %
            
            -60.6
            %**Net
                Loss**
            ****
            **$**
            **(30**
            **)**
            **$**
            **454**
            ****
            **$**
            **(233**
            **)**
            ****
            **-106.6**
            **%**
            ****
            **294.8**
            **%**MINORITY
                INTEREST EXPENSE
            
            $
            -
            
            $
            -
            
            $
            (22
            )
            
            -
            %
            
            -100.0
            %**SOUTH
                AFRICA NET EARNINGS (LOSS)**
            
            **$**
            **3,102**
            ****
            **$**
            **2,648**
            ****
            **$**
            **927**
            ****
            ****
            **17.1**
            **%**
            ****
            **185.7**
            **%**


**Average
                  exchange rate (Rand/USD)**
              **6.33**
              **6.45**
              **7.43**
              **-1.9%**
              **-13.2%**


(1)
            2004
                includes foreign currency translation adjustment for sale of Verkrans,
                net
                of cost of disposition.





-
            37
            -
 *Index*


Operational
          results in Rand for the years ended December 31, 2005, 2004 and 2003 are
          as
          follows:
 
 **CALEDON**
 
 *Amounts
                    shown in thousands*
                
                **2005**
                ****
                **2004**
                ****
                **2003**
                ****
                **%
                    Change**
                  **2005
                    v. 2004**
                ****
                **%
                    Change**
                  **2004
                    v. 2003**Operating
                    RevenueCasino
                
                R
                91,817
                
                R
                80,088
                
                R
                67,976
                
                
                14.6
                %
                
                17.8
                %Hotel,
                    food and beverage
                
                
                19,257
                
                
                17,753
                
                
                17,061
                
                
                8.5
                %
                
                4.1
                %Other
                    (net of promotional allowances)
                
                
                (3,
                    716
                )
                
                (2,260
                )
                
                (2,584
                )
                
                64.4
                %
                
                -12.5
                %Net
                    operating revenue
                
                
                107,358
                
                
                95,581
                
                
                82,453
                
                
                12.3
                %
                
                15.9
                %Costs
                    and ExpensesCasino
                
                
                35,629
                
                
                32,555
                
                
                29,365
                
                
                9.4
                %
                
                10.9
                %Hotel,
                    food and beverage
                
                
                13,633
                
                
                16,247
                
                
                14,998
                
                
                -16.1
                %
                
                8.3
                %General
                    and administrative
                
                
                16,043
                
                
                13,813
                
                
                11,484
                
                
                16.1
                %
                
                20.3
                %Depreciation
                
                
                9,328
                
                
                8,595
                
                
                7,950
                
                
                8.5
                %
                
                8.1
                %74,633
                
                
                71,210
                
                
                63,797
                
                
                4.8
                %
                
                11.6
                %Earnings
                    from operations
                
                
                32,725
                
                
                24,371
                
                
                18,656
                
                
                34.3
                %
                
                30.6
                %Interest
                    income
                
                
                322
                
                
                724
                
                
                1,216
                
                
                -55.5
                %
                
                -40.5
                %Interest
                    expense
                
                
                (4,099
                )
                
                (5,072
                )
                
                (6,950
                )
                
                -19.2
                %
                
                -27.0
                %Early
                    debt repayment expense
                
                
                (1,200
                )
                
                -
                
                
                -
                
                
                100.0
                %
                
                -
                %Gain
                    (loss) on foreign currency translation
                
                
                1
                
                
                5
                
                
                (49
                )
                
                -80.0
                %
                
                -110.2
                %Earnings
                    before income taxes
                
                
                27,749
                
                
                20,028
                
                
                12,873
                
                
                38.6
                %
                
                55.6
                %Income
                    tax expense
                
                
                8,187
                
                
                6,018
                
                
                4,284
                
                
                36.0
                %
                
                40.5
                %**Net
                    Earnings**
                ****
                **R**
                **19,562**
                ****
                **R**
                **14,010**
                ****
                **R**
                **8,589**
                ****
                ****
                **39.6**
                **%**
                ****
                **63.1**
                **%**
 
 **CENTURY
          CASINOS AFRICA**
 
 Operating
                    RevenueOther
                    (including promotional allowances)
                
                **R**
                -
                
                **R**
                (86
                )
                **R**
                -
                
                
                100.0
                %
                
                -100.0
                %Net
                    operating revenue (loss)
                
                
                -
                
                
                (86
                )
                
                -
                
                
                100.0
                %
                
                -100.0
                %Costs
                    and ExpensesGeneral
                    and administrative
                
                
                1,281
                
                
                992
                
                
                2,640
                
                
                29.1
                %
                
                -62.4
                %Recovery
                    of receivables previously written off
                
                
                -
                
                
                (1,003
                )
                
                -
                
                
                -100.0
                %
                
                -100.0
                %Depreciation
                
                
                16
                
                
                -
                
                
                18
                
                
                100.0
                %
                
                -100.0
                %1,297
                
                
                (11
                )
                
                2,658
                
                
                -11890.9
                %
                
                100.4
                %Loss
                    from operations
                
                
                (1,297
                )
                
                (75
                )
                
                (2,658
                )
                
                -1629.3
                %
                
                97.2
                %Interest
                    expense, net
                
                
                (202
                )
                
                -
                
                
                -
                
                
                100.0
                %
                
                -
                %Other
                    income, net
                
                
                936
                
                
                238
                
                
                215
                
                
                293.3
                %
                
                10.7
                %Loss
                    before income taxes
                
                
                (563
                )
                
                163
                
                
                (2,443
                )
                
                -445.4
                %
                
                106.7
                %Income
                    tax (benefit)
                
                
                (338
                )
                
                (234
                )
                
                (713
                )
                
                44.4
                %
                
                -67.2
                %**Net
                    (Loss) Earnings**
                
                **R**
                **(225**
                **)**
                **R**
                **397**
                ****
                **R**
                **(1,730**
                **)**
                
                -156.7
                %
                
                122.9
                %MINORITY
                    INTEREST EXPENSE
                
                R
                -
                
                R
                -
                
                R
                (176
                )
                
                -
                %
                
                -100.0
                %**SOUTH
                    AFRICA NET EARNINGS**
                
                **R**
                **19,337**
                ****
                **R**
                **14,407**
                ****
                **R**
                **6,683**
                
                
                34.2
                %
                
                115.6
                %
  -
              38
              -
 *Index*


**Casino
      Market Data (in Rand)**




**2005**
              
              **2004**
              
              **2003**Market
                  share of the Western Cape AGP
              
              
              5.6
              %
              
              5.9
              %
              
              6.0
              %Market
                  share of Western Cape gaming devices
              
              
              9.4
              %
              
              11.3
              %
              
              10.9
              %Average
                  number of slot machines
              
              
              307
              
              
              288
              
              
              274Average
                  slot machine win per day
              
              
              766
                  Rand
              
              
              693
                  Rand
              
              
              623
                  RandAverage
                  number of tables
              
              
              9
              
              
              9
              
              
              8Average
                  table win per day
              
              
              1,942
                  Rand
              
              
              2,132
                  Rand
              
              
              1,928
                  Rand


The
      results discussed below are all based on the Rand to eliminate the effect of
      fluctuations in foreign currency exchange rates.





When
      comparing 2005 and 2004, the 14.6% increase in the gross casino revenue is
      attributable to the continued marketing efforts. We market an array of amenities
      at the resort to our guests as a complement to the gaming experience. These
      currently include an 81-room hotel, a variety of dining experiences, three
      bars,
      the historic mineral hot spring and spa, the outdoor experience (a team building
      facility) and a conference facility. Additionally, Caledon increased the average
      number of slot machines by 6.6% over the same period. Revenue growth was slowed
      for 2005 due to the closure of a significant portion of the main east/west
      highway to Caledon from April 11, 2005 to May 27, 2005, a result of severe
      flooding in the area. In addition, the South African government introduced
      new
      currency notes during the second quarter of 2005 and the casino experienced
      an
      initial rejection rate of 80% on these new notes, which diminished as the
      Company installed new bill validation software for the wide variety of slot
      machines maintained by the Company.





When
      comparing 2004 and 2003, the 17.8% increase in gross gaming revenue is
      attributable to a number of factors including an increase in the number of
      slot
      machines to 300 from 290 and one additional table, the continuous marketing
      of
      cash coupons and improved management.





**Hotel,
      Food and Beverage**





Hotel
      occupancy was 44% for 2005 compared to 48% in 2004. Hotel revenue increased
      38.6% due mainly to upgraded rooms (i.e. standard rooms becoming suites) and
      their corresponding increases in room rates. Leisure sales increased by 44.9%
      in
      2005 compared to 2004. These increases in revenue were offset by a decrease
      in
      conference sales of 20.3% in the corresponding period. Food and beverage revenue
      decreased by 0.7% primarily due to a decrease in hotel occupancy, the closure
      of
      a restaurant in the third quarter and the decrease in the convention
      business.





When
      comparing 2004 and 2003, hotel revenue increased 5.6%. Hotel occupancy was
      48%
      for 2004 compared to 57% for 2003. Conference sales decreased 19.4%, while
      gift
      and leisure sales improved 110.1%. In June 2004, Caledon added a fourth
      restaurant to the already varied selection. This restaurant offers patrons
      Italian cuisine. Food and beverage revenue increased 6.2% in 2004 compared
      to
      2003, as a result of the additional food and beverage facility plus changes
      to
      operating hours and a general price increase.





The
      2.6
      million Rand reduction in hotel, food and beverage expenses results primarily
      from the elimination of a separate hotel marketing staff, which decreased
      advertising and promotion costs for the hotel. In previous years, CCAL
      advertised the casino and hotel operations separately. Current marketing efforts
      have focused on emphasizing the overall resort qualities of the operation,
      inclusive of both the casino and hotel. This has helped reduce Caledon’s overall
      marketing costs.





-
            39
            -
 *Index*





**Other**





Other
      operating revenue principally consists of promotional allowances and revenue
      generated from the resort’s ancillary services, which include the adventure
      center, spa center, and conference room rental.





The
      conversion to cashless gaming in March 2005 has resulted in a significant
      increase in the accumulation of points earned by players reported as an offset
      to operating revenue, other. All patrons of the casino are required to create
      a
      personal players account and play with a card on which they always earn points.
      Although gaming revenue increased, the point liability accrued for over 52,000
      active player accounts affected the reported results by approximately 0.5
      million Rand, net of taxes.





Interest
      expense for CCAL has decreased due to the early repayment of the term loan
      with
      ABSA in July 2005 and the early repayment of a series of capital leases in
      February 2005, offset by additional interest due on a 60 million Rand term
      loan
      borrowed by Caledon in August 2005. In order to repay ABSA Bank, CCAL entered
      into an overdraft facility with Nedbank Limited in the amount of 18.8 million
      Rand under which Nedbank extended temporary financing until the long term loan
      agreement was completed. Caledon incurred a 1.2 million Rand charge relating
      to
      the early repayment of the ABSA Bank loan. As a result of the transaction,
      Caledon was able to significantly lower its effective interest rate on
      outstanding term loans from 16.9% to a current 9.0%. When comparing 2004 to
      2003, interest expense has decreased by 27.0% as the principal balance of the
      term loans and capitalized lease are repaid. The weighted-average interest
      rate
      on the borrowings under term loan agreements for our South African subsidiaries
      was 10.5% in 2005 and 16.9% in 2004 and 2003.





Depreciation
      expense has increased because of the completion of a number of improvement
      projects at CCAL in 2004 and 2005. Depreciable assets increased by 6.4 million
      Rand in 2005 due primarily to our expansion of the casino’s gaming space, and by
      5.3 million Rand in 2004 due to ongoing improvements at the
      property.





General
      and administrative expenses at Caledon increased 16.1% in 2005 and 20.3% in
      2004
      as a result of departmental payroll increases related to the casino expansion
      and increases in service contracts related to the maintenance on the player
      tracking system and external security. In 2005, the Company recorded 0.4 million
      Rand of miscellaneous income for Caledon based upon the estimated amount
      recoverable on a business interruption claim filed with Caledon’s insurance
      company related to the road closure in the 2 nd quarter.





In
      2004,
      we recovered approximately 1.0 million Rand of previously written off
      receivables in connection with the sale of our interests in Gauteng, South
      Africa.





We
      recognized a foreign currency translation gain on the disposition of Verkrans,
      resulting from the difference between the exchange rate at the time of purchase
      in March 2002 and the exchange rate at the time of sale in December 2004. The
      reported results include a gain of $0.4 million in US dollars, but no
      corresponding gain in Rand.





-
            40
            -
 *Index*





**Cruise
      Ships Segment**





The
      Cruise ships segment operating results for the years ended December 31, 2005,
      2004 and 2003 are as follows:





*Amounts
                shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**
            
            **%
                Change**
              **2005
                v. 2004**
            
            **%
                Change**
              **2004
                v. 2003**Operating
                RevenueCasino
            
            $
            2,911
            
            $
            2,615
            
            $
            1,677
            
            
            11.3
            %
            
            55.9
            %Other
                (net of promotional allowances)
            
            
            240
            
            
            154
            
            
            60
            
            
            55.8
            %
            
            156.7
            %Net
                operating revenue
            
            
            3,151
            
            
            2,769
            
            
            1,737
            
            
            13.8
            %
            
            59.4
            %Costs
                and ExpensesCasino
            
            
            2,142
            
            
            1,836
            
            
            1,172
            
            
            16.7
            %
            
            56.7
            %General
                and administrative
            
            
            -
            
            
            -
            
            
            3
            
            
            -
            %
            
            -100.0
            %Depreciation
            
            
            144
            
            
            110
            
            
            74
            
            
            30.9
            %
            
            48.6
            %2,286
            
            
            1,946
            
            
            1,249
            
            
            17.5
            %
            
            55.8
            %Earnings
                from operations
            
            
            865
            
            
            823
            
            
            488
            
            
            5.1
            %
            
            68.6
            %Other
                income, net
            
            
            -
            
            
            -
            
            
            17
            
            
            -
            %
            
            -100.0
            %Earnings
                before income taxes
            
            
            865
            
            
            823
            
            
            505
            
            
            5.1
            %
            
            63.0
            %Income
                tax expense
            
            
            26
            
            
            25
            
            
            150
            
            
            4.0
            %
            
            -83.3
            %**Net
                Earnings**
            
            **$**
            **839**
            ****
            **$**
            **798**
            ****
            **$**
            **355**
            ****
            ****
            **5.1**
            **%**
            ****
            **124.8**
            **%**





At
        the
        end of 2005, we operated casinos on a total of seven ships: three from
        Silversea, one on the World of ResidenSea and three on Oceania Cruises. The
        casino concession agreement with the Silver Shadow (part of the Silversea
        family) terminated at the end of September 2005 and was not renewed. For
        2005,
        the Silver Shadow contributed $0.4 million of net operating revenue and $0.2
        million of net income to the consolidated statement of earnings. Also in
        2005,
        the Company extended the casino concession agreement with Oceania Cruises
        until
        the year 2012. On March 8, 2006, we received notification from Silversea
        Cruises
        that the concession agreement with the Silver Whisper will not be renewed
        as of
        July 2, 2006 and that the concession agreement with the Silver Wind will
        not be
        renewed as of May 3, 2007. In addition, we also received notification that
        the
        concession agreement with the Silver Cloud will not be renewed as of March
        30,
        2006; however, the Company deems that we did not receive timely written
        notification of the Silversea’s intention to discontinue this agreement on the
        Silver Cloud, as required by the original concession agreement. As a result,
        the
        operation of the casino aboard the Silver Cloud subsequent to March 30, 2006
        is
        uncertain at this time.





In
      2004
      we operated casinos on eight ships, four on Silversea, one on the World of
      ResidenSea and three on Oceania Cruises. In 2003 we operated seven casinos,
      four
      aboard Silversea, one on the World of ResidenSea and two on Oceania Cruises.
      During 2003 the Silversea’s Silver Wind ship returned to service in May after
      periodic maintenance operations. During the same year we opened casinos aboard
      the Oceania Insignia and Regatta. Following six months of routine maintenance
      operations, Silversea’s Silver Cloud and Oceania’s Insignia returned to
      operations in March 2004. In April 2004, we opened a casino aboard Oceania’s
      Nautica. The Nautica remained in service until November 2004, when it went
      into
      dry dock for routine maintenance. The Nautica returned to service in November
      2005.





Concession
      fees paid to the ship operators in accordance with the agreements accounted
      for
      approximately $1.3 million, $1.0 million and $0.1 million of the total casino
      expenses incurred in 2005, 2004 and 2003, respectively.




-
            41
            -
 *Index*


Casino
        expenses, excluding concession fees, dropped to 29.3% of revenue in 2005
        and
        compared to 30.8% of casino revenue in 2004 and 34.8% in 2003, reflecting
        our
        ability to leverage cruise ship operations. In addition, several of the cruise
        ships were inactive for periods of 2004. We cannot operate our casinos while
        the
        ships are in port.


Revenue
      generated on each cruise fluctuates significantly depending on the number of
      passengers and the quality of the players. This is a condition that is beyond
      our control, but does not significantly impact our consolidated results due
      to
      the relatively small size of the cruise ship operations in relation to our
      other
      operations.





The
      cruise ship concession agreements were assigned to CRI as of October 1, 2003
      and
      have since been subject to an effective tax rate of 3% in Mauritius.
      Additionally, for the remaining term of the original concession agreements,
      any
      income earned under these agreements are subject to an imputed royalty for
      US
      income tax purposes (reported in the corporate and other segment). As a result,
      the effective tax rate on net income generated by the cruise ships is 6.2%,
      6.2%
      and 32.9% for 2005, 2004 and 2003, respectively.





-
            42
            -
 *Index*





**Corporate
      & Other Segment**





*Amounts
                shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**
            
            **%
                Change**
              **2005
                v. 2004**
            
            **%
                Change**
              **2004
                v. 2003**Operating
                RevenueOther
            
            $
            105
            
            $
            101
            
            $
            114
            
            
            4.0
            %
            
            -11.4
            %Net
                operating revenue
            
            
            105
            
            
            101
            
            
            114
            
            
            4.0
            %
            
            -11.4
            %Costs
                and ExpensesGeneral
                and administrative
            
            
            3,741
            
            
            3,120
            
            
            2,117
            
            
            19.9
            %
            
            47.4
            %Depreciation
            
            
            26
            
            
            28
            
            
            172
            
            
            -7.1
            %
            
            -83.7
            %3,767
            
            
            3,148
            
            
            2,289
            
            
            19.7
            %
            
            37.5
            %Income
                from unconsolidated subsidiary
            
            
            (109
            )
            
            55
            
            
            -
            
            
            -298.2
            %
            
            100.0
            %Loss
                from operations
            
            
            (3,771
            )
            
            (2,992
            )
            
            (2,175
            )
            
            26.0
            %
            
            37.6
            %Interest
                income
            
            
            253
            
            
            6
            
            
            2
            
            
            4116.7
            %
            
            200.0
            %Interest
                expense
            
            
            (1,328
            )
            
            (922
            )
            
            (1,081
            )
            
            44.0
            %
            
            -14.7
            %Other
                income, net
            
            
            -
            
            
            -
            
            
            9
            
            
            -
            %
            
            -100.0
            %Non-operating
                items from unconsolidated subsidiary
            
            
            (4
            )
            
            (5
            )
            
            -
            
            
            20.0
            %
            
            -100.0
            %Loss
                before income taxes
            
            
            (4,850
            )
            
            (3,913
            )
            
            (3,245
            )
            
            23.9
            %
            
            20.6
            %Income
                tax benefit
            
            
            (2,655
            )
            
            (2,131
            )
            
            (1,273
            )
            
            24.6
            %
            
            67.4
            %Loss
                before minority interest
            
            
            (2,195
            )
            
            (1,782
            )
            
            (1,972
            )
            
            23.2
            %
            
            -9.6
            %Minority
                Interest
            
            
            (130
            )
            
            (106
            )
            
            -
            
            
            22.6
            %
            
            100.0
            %**Net
                Loss**
            
            **$**
            **(2,325**
            **)**
            **$**
            **(1,888**
            **)**
            **$**
            **(1,972**
            **)**
            
            23.1
            %
            
            -4.3
            %





Net
      operating revenue principally consists of casino technical service fees earned
      from operating Casino Millennium in Prague, Czech Republic. Effective September
      1, 2002, casino technical service fees and interest due to us are not being
      accrued until a certainty of cash flow is attained for Casino Millennium. These
      fees will be recognized when payment is certain.





General
      and administrative expenses have increased largely due to costs associated
      with
      new expansion projects, increases in corporate staffing and costs associated
      with Sarbanes-Oxley Act compliance. Compliance with the Sarbanes-Oxley Act
      have
      also resulted in increased auditing costs.





We
      increased our staffing levels in advance of our two new projects in order to
      effectively integrate these operations into our corporate structure. In
      addition, we have also increased staffing to better comply with the requirements
      of the Sarbanes-Oxley Act.





Interest
      income in 2005 is primarily derived from interest earned on the remaining
      proceeds from the ADC offering in October 2005 in addition to the interest
      earned on the cash balance in the prime account related to the exercise of
      stock
      options.





The
      Cripple Creek segment allocated $1.3 million, $0.9 million and $1.1 million
      in
      interest expense to the Corporate & Other segment during the years ended
      December 31, 2005, 2004 and 2003, respectively. Interest expense on the amounts
      advanced by Womacks, but not repaid, to fund the Company’s acquisitions and the
      repurchase of the Company’s common stock is calculated using the effective rate
      on all borrowings under Womacks’ revolving credit facility. In December 2005,
      CCI repaid these funds to Womacks.





The
      Corporate and Other Segment includes earnings and losses sustained by multiple
      companies taxed at their respective country’s rates. The mix of earnings and
      losses impacts the effective rate reported in the segment.





-
            43
            -
 *Index*





**Other
      Projects Under Development**





**Central
      City, Colorado**





We
      are **** developing
      a casino and hotel project in Central City, Colorado. The $48.7 million
      development is planned to include a 60,000 square foot casino and back of house
      with 625 slot machines, six table games, 27 hotel rooms, retail, food and
      beverage amenities and a 500 space on-site covered parking garage. We
      contributed $3.5 million cash equity to the project in exchange for a
      controlling 65% interest, and Tollgate Venture LLC contributed three existing
      non-operating casino buildings, land and land options valued at $5.7 million,
      net of mortgages, for a 35% interest. Of the $48.7 million in overall project
      costs, $3.5 million were contributed by us as cash equity, $39.5 million was
      financed externally, and the balance of $5.7 million is the net value of the
      minority partner’s contribution. We have also entered into a Casino Services
      Agreement to manage the property once the project is operational. On August
      2,
      2005, we secured $4.5 million in funding from a private investor, which was
      subsequently paid off in October 2005 from the proceeds of our ADC offering
      in
      October 2005. On November 21, 2005, we entered into a $35 million loan agreement
      with Wells Fargo Bank and a syndicate of institutional lenders. Construction
      on
      the Century Casino project is expected to be completed by the third quarter
      of
      2006. We incurred approximately $0.9 million in pre-opening expenses for the
      project in 2005, of which the entire amount has been allocated to the minority
      partner in the project by agreement.





**Edmonton,
      Alberta, Canada**





On
      February 24, 2005, we acquired a 56.4% interest in Century Resorts
      Alberta Inc. (“CRA”) for approximately $2.4 million. Our local partner,
      746306 Alberta, Ltd., contributed a 7.25-acre parcel of land and an
      existing 40 room hotel for the remaining 43.6% interest. On January 12, 2006,
      we
      purchased the remaining 43.6% minority shareholder interest in CRA for $7.3
      million Canadian (approximately $6.3 million). We paid $5.8 million Canadian
      (approximately $5.0 million) at closing with the remainder payable on the first
      anniversary of the opening of the casino. CRA is developing a Century casino
      and
      hotel project in Edmonton, Alberta, Canada. Excluding the costs to purchase
      the
      minority shareholder’s interest, the $30.5 million ($35.8 million Canadian)
      development is expected to include a casino with 600 gaming machines, 31 gaming
      tables, food and beverage amenities, a dinner theater, a 300 space underground
      parking facility, approximately 600 surface parking spaces and a 26-room hotel.
      Of the $30.5 million in overall project costs, we contributed $2.4 million
      ($3.0
      million Canadian) for our interest in CRA, $17.2 million ($20 million Canadian)
      will be financed through external financing, $9.0 million ($10.5 million
      Canadian) will be provided by us as a shareholder loan, and the balance of
      $1.9
      million ($2.3 million Canadian) is the net value of the minority partner’s
      contribution. On September 23, 2005, CRA agreed to the terms of a 20.0 million
      Canadian ($17.2 million) credit facility with Canadian Western Bank (“CWB”) for
      the development of the casino property. On December 17, 2004, the
      Alberta Gaming and Liquor Commission granted approval to begin construction
      of
      the casino property. As is customary, the issuance of the license does not
      occur
      until completion of construction and after all federal and provincial
      legislation, regulation and policies, and municipal requirements, permits,
      licenses and/or authorizations have been met. CRI has entered into a long-term
      agreement to manage the facility. Construction is expected to be completed
      by
      the fourth quarter of 2006. We incurred approximately $0.1 million in
      pre-opening expenses, net of taxes, for the project in 2005, of which a portion
      of the expenses have been allocated to the minority partner in accordance based
      on their ownership percentage in CRA.





-
            44
            -
 *Index*





**Liquidity
      and Capital Resources**





We
      generate substantial cash flows from operating activities, as reflected in
      the
      Consolidated Statement of Cash Flows. These cash flows reflect the impact on
      our
      consolidated operations of our marketing programs and on-going cost containment
      focus.





We
      use
      the cash flows generated by the Company to fund reinvestment in existing
      properties for both refurbishment and expansion projects, and to pursue
      additional growth opportunities via new development opportunities. When
      necessary, we supplement the cash flows generated by our operations with either
      cash on hand or funds provided by financing activities to balance our cash
      requirements.




Cash
      and
      cash equivalents totaled $37.2 million plus restricted cash of $0.9 million
      at
      December 31, 2005. Net working capital totaled $30.5 million. Additional
      liquidity at Womacks may be provided by the Company’s revolving credit facility
      with Wells Fargo Bank, under which we had a total commitment of $26 million
      ($20.3 million net of the quarterly reduction) and unused borrowing capacity
      of
      approximately $19.8 million at December 31, 2005. The maturity date of the
      borrowing commitment is August 2007. The available balance was reduced by $0.6
      million on January 1, 2006, will be reduced by $0.6 million on April 1, 2006 and then further reduced by $0.7 million at
      the
      beginning of each quarter beginning July 1, 2006 until maturity in August 2007.
      Borrowings under the credit facility may be used for capital expenditures and
      working capital at Cripple Creek and corporate headquarters. Womacks is also
      permitted to make cash distributions to the Company up to the amount of the
      Company’s capital contributions (currently $14.5 million). Additionally, in July
      2005, the Company filed a shelf registration statement with the SEC, under
      which
      we could issue up to $50 million in aggregate issue price of common stock,
      preferred stock, debt securities and depositary certificates. In October 2005,
      under this shelf registration, we issued 7,132,667 shares of common stock,
      in
      the form of Austrian Depositary Certificates, through our underwriter, to retail
      and institutional investors in the Republic of Austria and in a private
      placement to institutional investors in Europe outside of the Republic of
      Austria. Net proceeds from this issuance were approximately $46.2 million.
      A
      total of $19.0 million of the proceeds were used to repay outstanding debt.
      We
      plan to use the proceeds from this issuance to make investments in additional
      gaming projects and for working capital and other general corporate
      purposes.




On
      November 21, 2005, Century Tollgate, LLC (“CTL”) entered into a $35 million loan
      agreement with Wells Fargo Bank and a syndicate of institutional lenders. The
      loan agreement consists of a $32.5 million construction loan and a $2.5 million
      revolving line of credit (“CC Revolver”). The $32.5 million construction loan
      will convert to a 60-month term loan on the earlier of the 12 month anniversary
      of the closing of the loan or at such time as the Central City casino has been
      opened to the public. The $32.5 million construction loan and the CC Revolver
      will both mature on the fifth anniversary of conversion of the construction
      loan. The amount outstanding under the term loan is subject to quarterly
      reductions, beginning at $0.6 million for the first full quarter following
      the
      conversion date of the loan, increasing to $1.1 million on the 17 th full
      quarter from the conversion date of the loan, until maturity. Availability
      under
      the line of credit will be conditional upon CTL being in compliance with all
      of
      the financial and other covenants contained in the loan agreement at the time
      of
      a particular drawdown, and our continued ability to make certain representations
      and warranties. We are required to enter into an interest rate hedge for at
      least 75% of the outstanding amount of the loan on the conversion date, ending
      on the maturity date of the loan. As of December 31, 2005, the principal balance
      outstanding under the loan agreement is $8.9 million.




Cash
      provided by operating activities was $9.5 million, $8.5 million and $5.8 million
      for 2005, 2004 and 2003 respectively. For a description of the operating
      activities of the Company, please refer to the consolidated statements of cash
      flows and management’s discussion of the results of operations by
      segment.





-
            45
            -
 *Index*





Cash
      used
      in investing activities of $23.6 million for the year ended December 31, 2005
      consisted of a $2.4 million contribution by us towards our investment in
      CRA, less $1.7 million in net cash acquired, $1.9 million in property and
      equipment additions at Womacks, of which $1.5 million related to the exercise
      of
      a purchase option of previously leased property; $2.8 million in property
      improvements, gaming equipment and security equipment additions at Caledon,
      South Africa; $0.6 million in expenditures to upgrade some of the cruise ships
      with ticket-out slot machines and other gaming equipment; $11.9 million towards
      construction in Central City, Colorado; and $5.9 million in additional
      expenditures towards construction on the property in Edmonton, Alberta, Canada.
      These were offset by $0.3 million in proceeds from the disposition of property.





Cash
      used
      in investing activities of $7.1 million for the year ended December 31, 2004
      consisted of: $3.5 million investment by us for Century Casinos Tollgate, Inc.
      (“CTI”); $0.4 million towards the upgrade of the slot accounting system, $1.9
      million towards new slot games, $1.5 million in improvements to the property
      in
      Caledon, South Africa; $0.2 million in expenditures to outfit the cruise ships;
      and $0.5 million in expenditures for other long-lived assets, less $0.2 million
      in proceeds from the disposition of assets and $0.8 million, 4.4 million Rand,
      in proceeds from the disposition of the common stock of Verkrans.





Cash
      used
      in investing activities of $3.5 million for the year ended December 31, 2003,
      consisted of: $0.7 million towards the expansion of the Womacks casino at the
      rear of the property that was completed in the second quarter of 2003, providing
      a larger, more player friendly gaming space and the ability to increase Womacks’
slot machine capacity; $0.4 million for new slot machines; $0.8 million for
      additional improvements to the property in Caledon, South Africa; $1.3 million
      towards the purchase of the remaining 35% interest in Century Casinos Caledon
      (Pty) Limited, $0.9 million of which was applied against the minority
      shareholder liability and $0.3 million of which increased the carrying value
      of
      the land in Caledon; $0.2 million towards outfitting the two new casinos aboard
      the luxury cruise ships operated by Oceania and to finish re-outfitting the
      Silver Wind and $0.5 million due to expenditures for other long-lived assets,
      less $0.3 million in proceeds from the disposition of assets.




Cash
      provided by financing activities of $43.9 million for the year ended December
      31, 2005, primarily due to the $46.2 million ADC offering, $2.3 million from
      the
      exercise of stock options, net borrowings of $8.9 million associated with our
      construction loan with Wells Fargo Bank for the Central City project, net
      borrowings of $8.9 million associated with our loan with Nedbank Limited and
      $0.6 million from the release of restricted cash associated with the ABSA loan
      for Caledon. These inflows of cash were offset by net repayments of $15.1
      million (of which $14.5 million was obtained from the proceeds of the ADC
      offering) under the revolving credit facilities with Wells Fargo, $3.0 million
      under the Caledon loan agreement we entered into with ABSA, $1.1 million to
      our
      minority investor in Central City for a distribution of their interest and
      the
      repayment of an unsecured note payable, deferred financing charges of $2.4
      million, a restricted cash deposit of $1.0 million required for our listing
      on
      the Vienna Stock Exchange and other net repayments of $0.4 million.





Cash
      provided by financing activities of $1.9 million for the year ended December
      31,
      2004 consisted of: net borrowings of $3.9 million under the Womacks revolving
      credit facility, primarily for the $3.5 million capital contribution to the
      Central City, Colorado project, net repayments of $1.3 million under the loan
      agreement with ABSA, repayment of a $0.4 million note payable to a founding
      shareholder, and other net repayments of $0.2 million, less net borrowing of
      $0.1 million from a former director, which was subsequently repaid in 2004
      and
      additional deferred financing and licensing charges incurred by the Company
      with
      a cost of $0.1 million.





-
            46
            -
 *Index*





Cash
      used
      in financing activities of $2.5 million for the year ended December 31, 2003
      consisted of: net borrowings of $0.3 million under the revolving credit facility
      with Wells Fargo plus $0.9 million in proceeds from the exercise of stock
      options, less net repayments of $1.3 million under the loan agreement with
      ABSA
      Bank, $1.3 million to acquire a loan to CCAL held by the minority shareholder,
      Caledon Overberg Investments (Proprietary) Limited (“COIL”); $0.1 million
      towards the repurchase of the Company’s common stock on the open market at cost;
      and $1.1 million towards the purchase of 489,264 shares of common stock from
      a
      former director, James Forbes, at a per share price of $2.26.





On
      April
      8, 2005, CC Tollgate LLC entered into a loan agreement with Colorado Business
      Bank securing $5.0 million to finance the predevelopment construction costs
      associated with the development of the Central City, Colorado project. Under
      the
      amended terms of the agreement, the loan was to mature on
      January 4, 2006 at which time the principal was due with interest
      calculated at prime plus 0.5%. The note was secured by the existing property
      and
      improvements and by guarantees provided by the Company and Tollgate Venture
      LLC.
      On November 22, 2005, the company repaid the outstanding balance of $3.6 million
      with funds from the Wells Fargo Bank financing, plus accrued
      interest.





On
      August
      2, 2005, we secured $4.5 million in funding from a private lender, which bears
      interest at a rate of 16.7% per annum and was to mature in August 2007. In
      exchange for the funds, the Company pledged all the outstanding stock of CTI
      and
      its equity interest in CTL. Proceeds from these borrowings were used in the
      development of the casino and hotel in Central City, Colorado. On October 21,
      2005, the Company repaid the $4.5 million with proceeds from the ADC offering,
      plus accrued interest, without penalty.





On
      September 23, 2005, through our subsidiary CRA, we agreed to terms with Canadian
      Western Bank for a $20 million Canadian (approximately $17.1 million) credit
      facility for the development of a casino and hotel in Edmonton, Alberta, Canada.
      The facility is initially structured as a construction loan maturing within
      the
      earlier of 18 months or upon receipt of a certified architectural completion
      certificate, certificate of occupancy and casino license. Upon maturity of
      the
      construction loan, Canadian Western Bank will issue a term loan to CRA, maturing
      within one to five years at the election of CRA. The loan facility is secured
      by
      the assets of CRA and guaranteed by the Company.





The
      Company’s Board of Directors has approved a discretionary program to repurchase
      up to $5 million of the Company’s outstanding common stock. The Company did
      not purchase
      any shares of its common stock on the open market in 2005 .
      Since the inception of the program through December 31, 2005, the Company
      has repurchased 2,559,004 shares of its common stock at a total cost of
      approximately $3.8 million.





The
      primary source of our future operating cash flows will be from gaming. We will
      continue to rely on revolving lines of credit and term loans with commercial
      banks or other debt instruments to supplement our working capital and investing
      requirements. We believe that our cash at December 31, 2005, together with
      expected cash flows from operations and borrowing capacity under the various
      credit facilities, will be sufficient to fund our anticipated operating costs,
      capital expenditures at existing properties and satisfy our current debt
      repayment obligations. We will continue to evaluate our planned capital
      expenditures at each of our existing locations in light of the operating
      performance of the facilities at such locations. From time to time we expect
      to
      have cash needs for the development of new properties that exceed our current
      borrowing capacity and we may be required to seek additional financing in the
      debt or equity markets. We may be unable to obtain additional debt or equity
      financing on acceptable terms. As a result, limitations on our capital resources
      could delay or cause us to abandon certain plans for the development of new
      properties.





-
            47
            -
 *Index*





**Contractual
      Obligations and Commercial Commitments**





The
      following is a schedule of our contractual obligations and commercial
      commitments as of December 31, 2005:





**Payments
                Due by Period**
              ***Amounts
                shown in thousands*****Contractual
                Obligations**
            ****
            **Total**
            ****
            **Less
                than 1****year**
            ****
            **1-3
                years**
            ****
            **4-5
                years**
            ****
            **More
                than 5****years**Long-Term
                Debt
            
            $
            19,638
            
            $
            1,741
            
            $
            10,460
            
            $
            7,437
            
            $
            -Capital
                Lease Obligations
            
            
            154
            
            
            68
            
            
            46
            
            
            40
            
            
            -Operating
                Leases
            
            
            751
            
            
            351
            
            
            255
            
            
            145
            
            
            -Total
                Contractual Cash Obligations
            
            $
            20,543
            
            $
            2,160
            
            $
            10,761
            
            $
            7,622
            
            $
            -




**Off-Balance
      Sheet Arrangements**




We
        do not
        maintain any off-balance sheet arrangements, transactions, obligations or
        other
        relationships with unconsolidated entities that would be expected to have
        a
        material current or future effect upon our financial statements.


**Critical
      Accounting Estimates**





The
      preparation of financial statements requires us to make estimates and judgments
      that affect the reported amounts of assets, liabilities, revenue and expenses,
      and related disclosure of contingent assets and liabilities. On an on-going
      basis, we evaluate these estimates, including those related to goodwill and
      other intangible assets and property and equipment. We base our estimates on
      historical experience and on various other assumptions that are believed to
      be
      reasonable under the circumstances, the results of which form the basis for
      making judgments about the carrying values of assets and liabilities that are
      not readily apparent from other sources. Actual results may differ materially
      from these estimates under different assumptions or conditions. Our significant
      accounting policies are discussed in Note 2 of the Notes to Consolidated
      Financial Statements; critical estimates inherent in these accounting policies
      are discussed in the following paragraphs.





***Goodwill
      and Other Intangible Assets*** - Our
      goodwill results from the acquisitions of casino and hotel operations and
      represents excess of the purchase price over the fair value of identifiable
      net
      tangible and intangible assets acquired. Goodwill and intangible assets with
      indefinite lives are required to be tested for impairment at least annually
      or
      more frequently if an event occurs or circumstances change that may reduce
      the
      fair value of the asset below its carrying value. We have completed our
      assessment of goodwill and other intangibles with indefinite lives for
      impairment at December 31, 2005 and determined that there have been no
      significant changes in the fair value of the assets, no adverse changes in
      the
      projected cash flows or any events or circumstances that would lead management
      to believe that the fair value of the assets are less than the current carrying
      value of the reporting units. For reporting units with goodwill and/or
      intangible assets with indefinite lives, this test requires the comparison
      of
      the implied fair value of each reporting unit to its carrying value. The implied
      fair value includes estimates of future cash flows, as well as estimates of
      critical valuation inputs such as discount rates, terminal values and similar
      data based on reasonable and supportable assumptions that represent our best
      estimates. Changes in estimates or application of alternative assumptions and
      definitions could produce significantly different results. We will continue
      to
      assess goodwill and other intangibles with indefinite lives for impairment
      at
      least annually hereafter. We will also continue to assess the propriety of
      our
      assignment of indefinite useful lives to intangible assets through analysis
      of
      all pertinent factors used in making such estimates. Included in assets at
      December 31, 2005 is goodwill of approximately $8.7 million and casino licenses
      of approximately $1.8 million.





-
            48
            -
 *Index*





***Property
      and Equipment*** - At
      December 31, 2005, we had property and equipment totaling $69.6 million,
      representing 56% of total assets. We capitalize the cost of property and
      equipment. Maintenance and repairs that neither materially add to the value
      of
      the property nor appreciably prolong its life are charged to expense as
      incurred. We depreciate property and equipment on a straight-line basis over
      their estimated useful lives. The estimated useful lives are based on the nature
      of the assets and our current operating expectations. Future events such as
      property expansions, new competition and new regulations could result in a
      change in the manner in which we are using certain assets requiring a change
      in
      the estimated useful lives of such assets. We evaluate long-lived assets for
      impairment whenever events or changes in circumstances indicate that such
      carrying values may not be recoverable. Under current standards, the assets
      must
      be carried at historical cost if the projected cash flows from their use will
      recover their carrying amounts on an undiscounted basis and without considering
      interest. However, if projected cash flows are less than their carrying value,
      the long-lived assets must be reduced to their estimated fair value.
      Considerable judgment is required to project such cash flows and, if required,
      estimate the fair value of the impaired long-lived asset. The estimated future
      cash flows are based upon, among other things, assumptions about expected future
      operating performance and may differ from actual cash flows. There can be no
      assurance that future long-lived asset impairments will not occur. We capitalize
      the cost of property and equipment that is contributed in a business combination
      at the fair value of the assets that are contributed. Capital assets contributed
      by our minority interest partners in CC Tollgate LLC and Century Resorts Alberta
      Inc. were recorded at estimated fair value.





***Stock-Based
      Compensation*** - We use
      the Black-Scholes option pricing model to estimate the fair value of stock
      options. The Black-Scholes model requires management to estimate certain
      variables. Such estimates include the estimated lives of options from grant
      date
      to exercise date, the volatility of the underlying shares and estimated future
      dividend rates. The two most significant estimates in the Black-Scholes model
      are volatility and expected life. An increase in the volatility rate increases
      the value of stock options and a decrease causes a decline in value. The Company
      estimated expected volatility using an average of our common stock price over
      the preceding twelve month period. For expected lives, an increase in the
      expected life of an option increases its value. Based on the nature of our
      options and the individuals that they are being issued to, we have estimated
      that the expected lives of our options are equal to their contractual
      terms.





**ITEM
                7A.**
            **Quantitative
                and Qualitative Disclosures About Market Risk.**





We
      are
      exposed to market risk principally related to changes in interest rates and
      foreign currency exchange rates. To mitigate some of these risks, we utilize
      derivative financial instruments to hedge these exposures. We do not use
      derivative financial instruments for speculative or trading purposes. All of
      the
      potential changes noted below are based on information available at December
      31,
      2005. Actual results may differ materially.





***Interest
      Rate Sensitivity*** ****





We
      are
      subject to interest rate risk on the outstanding borrowing under the credit
      facility with Wells Fargo. Interest on the credit facility is variable based
      on
      the interest rate option selected by us, whereby the interest on the outstanding
      debt is subject to fluctuations in the prime interest rate as set by Wells
      Fargo, or LIBOR index charges.





-
            49
            -
 *Index*


In
        order
        to minimize the risk of increases in the prime rate or LIBOR, we previously
        entered into two interest-rate swap agreements in a total of $11.5 million
        notional amount of debt. In 1998, we entered into a five-year interest-rate
        swap
        agreement, which matured on October 11, 2003 on $7.5 million of debt under
        the
        credit facility, whereby we paid a LIBOR-based fixed rate of 5.55% and received
        a LIBOR-based floating rate reset quarterly based on a three-month rate.
        In May
        2000, we entered into a five-year interest rate swap agreement, which matured
        on
        July 1, 2005 on $4.0 million notional amount of debt under the credit facility,
        whereby we paid a LIBOR-based fixed rate of 7.95% and received a LIBOR-based
        floating rate reset quarterly based on a three-month rate. Generally, the
        swap
        arrangements were advantageous to us to the extent that interest rates increased
        in the future and disadvantageous to the extent that they decreased. Therefore,
        by entering into the interest rate swap agreements, we had a cash flow risk
        when
        interest rates dropped. Without
        the swap agreements, the weighted-average interest rate on the credit facility
        would have been 6.4% in 2005, 4.1% in 2004, and 4.0% in 2003.
 
 As
        of and subsequent to December 31, 2005, the Company has no outstanding interest
        rate swap agreements. However, the
        Company is required to enter into an interest rate hedge for at least 75%
        of the
        outstanding amount of the loan with Wells Fargo for the construction of the
        Central City project on the date the loan converts from a construction loan
        to a
        term loan, ending on the maturity date of the loan. We expect that this
        agreement will have the effect of converting the floating interest rate on
        the
        Central City debt to a fixed rate on the hedged portion.


We
      are
      also subject to interest rate risk on the outstanding borrowings with Canadian
      Western Bank, Nedbank Limited and the revolving credit facility associated
      with
      the Central City, Colorado project. Interest on amounts outstanding under these
      loan agreements are variable and thus subject to fluctuations in their various
      prime rates. Based on our current outstanding borrowings,  a
      1.0%
      movement in the weighted average interest rate would result in an approximate
      $0.2 million annualized increase or decrease in interest expense.





***Foreign
      Currency Exchange Risk***





A
      total
      of 45.4% of our net operating revenues for the year ended December 31, 2005
      was
      derived from our South African operations and principally denominated in South
      African Rand. A total of 41.0% of our expenses for the year ended December
      31,
      2005 were paid in currencies other than US dollars of which 38.1% was paid
      in
      South African Rand, 0.8% was paid in Canadian dollars and 2.1% was paid in
      Euros. Our US operations generate revenues denominated in US dollars. If an
      arrangement provides for us to receive payments in a foreign currency, revenue
      realized from such an arrangement may be lower if the value of such foreign
      currency declines. Similarly, if an arrangement provides for us to make payments
      in a foreign currency, cost of services and operating expenses for such an
      arrangement may be higher if the value of such foreign currency increases.
      For
      example, a 10% change in the relative value of such foreign currency could
      cause
      a related 10% change in our previously expected revenue, cost of services,
      and
      operating expenses. If the international portion of our business continues
      to
      grow, more revenue and expenses will be denominated in foreign currencies,
      which
      increase our exposure to fluctuations in currency exchange rates. We have not
      hedged against foreign currency exchange rate changes related to our
      international operations.





**Item
                8.**
            **Financial
                Statements and Supplementary
                Data.**





See
      “Index” on page 2 hereof.





**Item
                9.**
            **Changes
                in and Disagreements With Accountants on Accounting and Financial
                Disclosure.**





None.





-
            50
            -
 *Index*





**Item
                9A.**
            **Controls
                and Procedures.**





***Evaluation
      of Disclosure Controls and Procedures -*** Our
      management, with the participation of our principal executive officers,
      principal financial officer and chief accounting officer, has evaluated the
      effectiveness of our disclosure controls and procedures (as defined in Rules
      13a-15(2) and 15d-15(e) under the Securities Exchange Act of 1937, as amended
      (the “Exchange Act”), as of the end of the period covered by this Annual Report
      on Form 10-K. Based on such evaluation, our principal executive officers,
      principal financial officer and chief accounting officer have concluded that
      as
      of such date, our disclosure controls and procedures were designed to ensure
      that information required to be disclosed by us in reports that we file or
      submit under the Exchange Act is recorded, processed, summarized and reported
      within the time periods specified in applicable SEC rules and forms and were
      effective.





***Management’s
      Annual Report on Internal Control over Financial Reporting and Attestation
      Report of Registered Public Accounting Firm -*** The
      Company’s management is responsible for establishing and maintaining adequate
      internal control over our financial reporting, as defined in Rules 13a-15(f)
      and
      15d-15(f) under the Exchange Act. Our internal control system was designed
      to
      provide reasonable assurance to our management and board of directors regarding
      the preparation and fair presentation of published financial statements. There
      are inherent limitations in the effectiveness of any internal control, including
      the possibility of human error and the circumvention or overriding of controls.
      Accordingly, even effective internal controls can provide only reasonable
      assurances with respect to financial statement preparation. Further, because
      of
      changes in conditions, the effectiveness of internal controls may vary over
      time.





The
      Company’s management has assessed the effectiveness of our internal controls
      over financial reporting as of December 31, 2005. In making this assessment,
      our
      management used the criteria set forth in the Committee of Sponsoring
      Organizations of the Treadway Commission (COSO) in *Internal
      Control - Integrated Framework* .





Based
      on
      the assessment using those criteria, our management believes that, as of
      December 31, 2005, internal control over financial reporting was
      effective.





Grant
      Thornton LLP, our independent registered public accounting firm, also attested
      to, and reported on, management’s assessment of the effectiveness of internal
      control over financial reporting. Grant Thornton LLP’s report is included in our
      2005 Financial Statements in Item 8 under the caption “Report of Independent
      Registered Public Accounting Firm” and is incorporated herein by
      reference.


***Changes
        in Internal Control Over Financial Reporting -*** In
        conjunction with the 2004 audit, our independent registered public accounting
        firm notified us that it had identified matters involving internal control
        over
        financial reporting and its operation that they considered to be a material
        weakness. These matters related to the controls over the recording of fixed
        assets in our South African operating subsidiary. The lack of a substantive
        policy on the capitalization of fixed assets and a deficiency in our internal
        review process as it relates to the South African operation were the reasons
        attributed to the failure in detecting this weakness. During the fourth quarter
        of 2005, we tested the changes made in previous quarters to the authorization
        and approval processes by which entries are recorded to the financial statements
        and fixed asset registers. We have concluded that these changes materially
        improved our internal controls over financial reporting (as defined in Rules
        13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth quarter
        ended
        December 31, 2005 and remediated the material weakness.





-
            51
            -
 *Index*





**Item
                9B.**
            **Other
                Information.**




The
        following disclosures would have otherwise been filed on Form 8-K under the
        caption “Item 1.01. Entry into a Material Definitive Agreement.”
 
 On
        February 16, 2006, the Company entered into an Employment Agreement with
        Mr. Ray
        Sienko. The agreement will continue until terminated in accordance with the
        provisions of the agreement. Mr. Sienko’s main duties on behalf of the Company
        as of the effective date shall be to serve as Chief Accounting Officer of
        the
        Company. Mr. Sienko will be paid an annual base salary of $100,000 and an
        annual
        bonus at the discretion of the Company’s Compensation Committee. Mr. Sienko also
        will be eligible for option grants as determined from time to time by the
        Company’s Incentive Plan Committee. The agreement is subject to various
        non-compete clauses for a term of six months, in the event of a termination
        by
        the Company without cause, and for one year in all other
        circumstances.


-
            52
            -
 *Index*





**PART
      III**





**Item
                10.**
            **Directors
                and Executive Officers of the
                Registrant.**





The
      information required by this item will be included in our Proxy Statement with
      respect to our 2006 Annual Meeting of Stockholders to be filed with the SEC
      within 120 days of December 31, 2005, under the captions “Information Concerning
      Directors and Executive Officers” and “Compliance with Section 16(a) of the
      Securities Exchange Act” and is incorporated herein by reference.





We
      have
      adopted a Code of Ethics that applies to all directors, officers and employees,
      including our Co Chief Executive Officers, our President, our Senior Vice
      President and our Chief Accounting Officer. A complete text of this Code of
      Ethics is available in Exhibit 14 filed with our Form 10-K for the year ended
      December 31, 2003.




**Item
                11.**
            **Executive
                Compensation.**





The
      information required by this item will be included in our Proxy Statement with
      respect to its 2006 Annual Meeting of Stockholders to be filed with the SEC
      within 120 days of December 31, 2005, under the caption “Information Concerning
      Directors and Executive Officers” and is incorporated herein by
      reference.




**Item****12****.**
            **Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters.**





The
      information required by this item will be included in our Proxy Statement with
      respect to its 2006 Annual Meeting of Stockholders to be filed with the SEC
      within 120 days of December 31, 2005, under the caption “Voting Securities” and
      is incorporated herein by reference.





**Item
                13.**
            **Certain
                Relationships and Related
                Transactions.**





The
      information in this item is incorporated by reference from our Proxy Statement
      with respect to the 2006 Annual Meeting of Stockholders to be filed with the
      SEC
      within 120 days of December 31, 2005, under the caption “Certain Relationships
      and Related Transactions” and is incorporated herein by reference.





**Item
                14.**
            **Principal
                Accountant Fees and
                Services.**





The
      information in this item is incorporated by reference from our Proxy Statement
      with respect to the 2006 Annual Meeting of Stockholders to be filed with the
      SEC
      within 120 days of December 31, 2005, under the caption “Principal Accountant
      Fees and Services” and is incorporated herein by reference.





-
            53
            -
 *Index*





**PART
      IV**





**Item
                15.**
            **Exhibits
                and Financial Statement
                Schedules.**





**(a)**
            **List
                of documents filed with this
                report**





1.
            Financial
                Statements of the Company (including related notes to consolidated
                financial statements) filed as part of this report are listed
                below:





Consolidated
      Balance Sheets as of December 31, 2005 and 2004.





Consolidated
      Statements of Earnings for the Years Ended December 31, 2005, 2004 and
      2003.





Consolidated
      Statements of Shareholders’ Equity and Comprehensive Income for the years ended
      December 31, 2005, 2004 and 2003.





Consolidated
      Statements of Cash Flows for the Years Ended December 31, 2005, 2004 and
      2003.





2.
            Financial
                Statement Schedules





None





3.
            List
                of Exhibits





**(b)**
            **Exhibits
                Filed Herewith or Incorporated by Reference to Previous Filings with
                the
                Securities and Exchange
                Commission:**





*(3)
      Articles of Incorporation and Bylaws*





3.1
            Certificate
                of Incorporation (filed with Proxy Statement in respect of the 1994
                Annual
                Meeting of Stockholders and incorporated herein by reference) is
                hereby
                incorporated by reference from Exhibit 3.1 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                1995.





3.2.2
            Amended
                and Restated Bylaws of Century Casinos, Inc., is hereby incorporated
                by
                reference from Exhibit 11.14 to Century Casinos’ Quarterly Report on Form
                10-Q for the quarterly period ended June 30,
                2002.





*(4)
      Instruments Defining the Rights of Security Holders, Including
      Indentures*





4.4
            Rights
                Agreement, dated as of April 29, 1999, between the Company and American
                Securities Transfer & Trust, Inc., as Rights Agent, is hereby
                incorporated by reference from Exhibit 1 to Century Casinos’ Form 8-A
                dated May 7, 1999.





4.5
            First
                Supplement to Rights Agreement dated April 2000, between Century
                Casinos,
                Inc and American Securities Transfer & Trust, Inc., as Rights Agent,
                is hereby incorporated by reference from Exhibit A to Century Casinos’
                Proxy Statement in respect of the 2000 Annual Meeting of
                Stockholders.





-
            54
            -
 *Index*





4.6
            Second
                Supplement to Rights Agreement dated July 2002, between Century Casinos,
                Inc and Computershare Investor Services, Inc. as Rights Agent, is
                hereby
                incorporated by reference from Exhibit 11.13 to Century Casinos’ Quarterly
                Report on Form 10-Q for the quarterly period ended June 30,
                2002.





*(10)
      Material Contracts*





10.51
            Asset
                Purchase Agreement dated as of September 27, 1995 by and among Gold
                Creek
                Associates, L.P., WMCK Acquisition Corp. and Century Casinos, Inc.,
                including Exhibits and Schedules, along with First Amendment thereto,
                is
                hereby incorporated by reference from Exhibit 10.51 to Century Casinos’
                Annual Report on Form 10-KSB for the fiscal year ended December 31,
                1995.





10.78
            Parking
                Lease - Option to Purchase dated June 1, 1998, between the City of
                Cripple
                Creek (“Lessor”) and WMCK Venture Corporation (“Lessee”) is hereby
                incorporated by reference from Exhibit 10.78 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                1998.





10.79
            Casino
                Services Agreement dated January 4, 1999 by and between Casino Millennium
                a.s., Century Casinos Management, Inc. and B.H. Centrum a.s. is hereby
                incorporated by reference from Exhibit 10.79 to Century Casinos’ Quarterly
                Report on Form 10-QSB for the quarterly period ended March 31,
                1999.





10.86
            Casino
                Management Agreement, dated December 3, 1999, by and between Caledon
                Casino Bid Company (Pty) Limited and Century Casinos Africa (Pty)
                Ltd. is
                hereby incorporated by reference from Exhibit 10.86 to Century Casinos’
                Annual Report on Form 10-KSB for the fiscal year ended December 31,
                1999.





10.87
            Shareholders
                Agreement, dated December 3, 1999, and Addendum to the Agreement,
                dated
                December 9, 1999, by and between Caledon Casino Bid Company (Pty)
                Limited,
                Caledon Overberg Investments (Pty) Limited, Century Casinos Africa
                (Pty)
                Ltd., Century Casinos, Inc. (not as a shareholder or party, but for
                clauses 4.2.3 and 6.7 of this agreement only), Caledon Hotel Spa
                and
                Casino Resort (Pty) Limited, Fortes King Hospitality (Pty) Limited,
                The
                Overberger Country Hotel and Spa (Pty) Limited, and Senator Trust
                is
                hereby incorporated by reference from Exhibit 10.87 to Century Casinos’
                Annual Report on Form 10-KSB for the fiscal year ended December 31,
                1999.





10.88
            Memorandum
                of Agreement, dated January 7, 2000, by and between B. H. Centrum
                a.s (a
                subsidiary of Ilbau and Bau Holding) and Century Casinos, Inc. is
                hereby
                incorporated by reference from Exhibit 10.88 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                1999.





10.92
            Amendment
                No. 1 to Parking Lease - Option to Purchase, dated February 17, 2000,
                by
                and between City of Cripple Creek (“Lessor”) and WMCK Venture Corporation
                (“Lessee”) is hereby incorporated by reference from Exhibit 10.92 to
                Century Casinos’ Annual Report on Form 10-KSB for the fiscal year ended
                December 31, 1999.





-
            55
            -
 *Index*





10.93
            Amended
                and Restated Credit Agreement, by and among, WMCK Venture Corp.,
                Century
                Casinos Cripple Creek, Inc., and WMCK Acquisition Corp. (collectively,
                the
                “Borrowers”), Century Casinos, Inc. (the “Guarantor”) and Wells Fargo
                Bank, National Association, dated April 21, 2000, is hereby incorporated
                by reference from Exhibit 10.93 to Century Casinos’ Quarterly Report on
                Form 10-QSB for the quarterly period ended March 31,
                2000.





10.94
            Loan
                Agreement between Century Casinos Africa (Proprietary) Limited, Caledon
                Casino Bid Company (Proprietary) Limited, Caledon Overberg Investments
                (Proprietary) Limited, and Century Casinos, Inc. (for purposes of
                clause
                14.6 only), dated March 31, 2000, is hereby incorporated by reference
                from
                Exhibit 10.94 to Century Casinos’ Quarterly Report on Form 10-QSB for the
                quarterly period ended March 31,
                2000.





10.95
            Subscription
                Agreement between Century Casinos Africa (Proprietary) Limited, Caledon
                Casino Bid Company (Proprietary) Limited, Caledon Overberg Investments
                (Proprietary) Limited, and Century Casinos, Inc. (for purposes of
                clause
                10.6 only), dated March 31, 2000, is hereby incorporated by reference
                from
                Exhibit 10.95 to Century Casinos’ Quarterly Report on Form 10-QSB for the
                quarterly period ended March 31,
                2000.





10.98
            Shareholders
                Agreement, dated November 4, 2000, by and between Caledon Casino
                Bid
                Company (Pty) Limited, Caledon Overberg Investments (Pty) Limited,
                Century
                Casinos Africa (Pty) Ltd., Century Casinos, Inc. (not as a shareholder
                or
                party, but for clauses 8.5, 15.1 and 15.2 of this agreement only),
                Overberg Empowerment Company Limited and The Overberg Community Trust,
                is
                hereby incorporated by reference from Exhibit 10.98 to Century Casinos’
                Annual Report on Form 10-KSB for the fiscal year ended December 31,
                2000.





10.101
            First
                Amendment to the Amended and Restated Credit Agreement, by and among,
                WMCK
                Venture Corp., Century Casinos Cripple Creek, Inc., and WMCK Acquisition
                Corp. (collectively, the “Borrowers”), Century Casinos, Inc. (the
                “Guarantor”) and Wells Fargo Bank, National Association, dated August 22,
                2001, is hereby incorporated by reference from Exhibit 11.01 to Century
                Casinos’ Quarterly Report on Form 10-QSB for the quarterly period ended
                September 30, 2001.





10.102
            Management
                Agreement by and between Century Casinos, Inc. and Focus Casino Consulting
                A.G. dated March 1, 2001, is hereby incorporated by reference from
                Exhibit
                11.02 to Century Casinos’ Annual Report on Form 10-KSB for the fiscal year
                ended December 31, 2001.





10.103
            Management
                Agreement by and between Century Casinos, Inc. and Flyfish Casino
                Consulting A.G. dated March 1, 2001, is hereby incorporated by reference
                from Exhibit 11.03 to Century Casinos’ Annual Report on Form 10-KSB for
                the fiscal year ended December 31,
                2001.





10.104
            Equity
                Subscription Agreement by and between Rhino Resort Limited, Silverstar
                Development Limited and Century Casinos Africa (Pty) Ltd. dated September
                7, 2001, is hereby incorporated by reference from Exhibit 11.04 to
                Century
                Casinos’ Annual Report on Form 10-KSB for the fiscal year ended December
                31, 2001.





-
            56
            -
 *Index*





10.105
            Memorandum
                of Agreement by and between Century Casinos Caledon (Pty) Ltd. (previously
                known as Caledon Casino Bid Company (Pty) Ltd.) and Century Casinos
                Africa
                (Pty) Ltd. and Fortes King Hospitality (Pty) Ltd. (and/or its successor
                to
                the Hotel Management Agreement - FKH) dated September 20, 2001, is
                hereby
                incorporated by reference from Exhibit 11.05 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                2001.




10.106
            Amendment
                to Loan Agreement between Century Casinos Africa (Pty) Limited and
                Century
                Casinos Caledon (Pty) Ltd. (previously known as Caledon Casino Bid
                Company
                (Pty) Ltd.), Caledon Overberg Investments (Pty) Limited and Century
                Casinos, Inc. dated September 20, 2001, is hereby incorporated by
                reference from Exhibit 11.06 to Century Casinos’ Annual Report on Form
                10-KSB for the fiscal year ended December 31,
                2001.





10.107
            Adjustment/Amendment
                No. 1 to Management Agreement by and between Century Casinos, Inc.
                and
                Focus Casino Consulting A.G. dated October 11, 2001, is hereby
                incorporated by reference from Exhibit 11.07 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                2001.





10.108
            Adjustment/Amendment
                No. 1 to Management Agreement by and between Century Casinos, Inc.
                and
                Flyfish Casino Consulting A.G. dated October 11, 2001, is hereby
                incorporated by reference from Exhibit 11.08 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                2001.





10.111
            Amendment
                Number 1 to the Equity Subscription Agreement entered into on September
                7,
                2001 by and between Rhino Resort Limited, Silverstar Development
                Limited
                and Century Casinos Africa (Pty) Ltd dated March 2, 2002, is hereby
                incorporated by reference from Exhibit 11.11 to Century Casinos’ Annual
                Report on Form 10-KSB for the fiscal year ended December 31,
                2001.





10.113
            Hotel
                Management Agreement dated December 3, 1999 between Century Casinos
                Caledon (Pty) Ltd. (previously known as Caledon Casino Bid Company
                (Pty)
                Ltd.) and Fortes King Hospitality (Pty) Ltd., is hereby incorporated
                by
                reference from Exhibit 11.12 to Century Casinos’ Quarterly Report on Form
                10-Q for the quarterly period ended March 31,
                2002.





10.115
            Second
                Amendment to the Amended and Restated Credit Agreement, by and among,
                WMCK
                Venture Corp., Century Casinos Cripple Creek, Inc., and WMCK Acquisition
                Corp. (collectively, the “Borrowers”), Century Casinos, Inc. (the
                “Guarantor”) and Wells Fargo Bank, National Association, dated August 28,
                2002, is hereby incorporated by reference from Exhibit 10.115 to
                Century
                Casinos’ Quarterly Report on Form 10-Q for the quarterly period ended
                September 30, 2002.





10.120
            Employment
                Agreement by and between Century Casinos, Inc. and Erwin Haitzmann
                as
                restated on February 18, 2003, is hereby incorporated by reference
                from
                Exhibit 10.120 to Century Casinos’ Annual Report on Form 10-K for the
                fiscal year ended December 31,
                2002.





10.121
            Employment
                Agreement by and between Century Casinos, Inc. and Peter Hoetzinger
                as
                restated on February 18, 2003, is hereby incorporated by reference
                from
                Exhibit 10.121 to Century Casinos’ Annual Report on Form 10-K for the
                fiscal year ended December 31,
                2002.





-
            57
            -
 *Index*





10.122
            Adjustment/Amendment
                No. 2 to Management Agreement by and between Century Casinos, Inc.
                and
                Focus Casino Consulting A.G. dated October 12, 2002, is hereby
                incorporated by reference from Exhibit 10.122 to Century Casinos’ Annual
                Report on Form 10-K for the fiscal year ended December 31,
                2002.





10.123
            Adjustment/Amendment
                No. 2 to Management Agreement by and between Century Casinos, Inc.
                and
                Flyfish Casino Consulting A.G. dated October 12, 2002, is hereby
                incorporated by reference from Exhibit 10.123 to Century Casinos’ Annual
                Report on Form 10-K for the fiscal year ended December 31,
                2002.





10.124
            Sale
                Agreement between Century Casinos Africa (Pty) Limited and Caledon
                Overberg Investments (Pty) Limited dated January 7, 2003, is hereby
                incorporated by reference from Exhibit 10.124 to Century Casinos’ Annual
                Report on Form 10-K for the fiscal year ended December 31,
                2002.





10.131
            Adjustment/Amendment
                No. 3 to Management Agreement by and between Century Casinos, Inc.
                and
                Flyfish Casino Consulting A.G. dated March 29, 2004, is hereby
                incorporated by reference from Exhibit 10.131 to Century Casinos’
                Quarterly Report on Form 10-Q for the quarterly period ended March
                31,
                2004.





10.132
            Contribution
                agreement dated as of October 12, 2004 among Century Casinos Tollgate
                Inc., Tollgate Venture, LLC, KJE Investments, LLC, Central City Venture,
                LLC, and CC Tollgate LLC., is hereby incorporated by reference from
                Exhibit 10.132 to Century Casinos’ Quarterly Report on Form 10-Q for the
                quarterly period ended September 30,
                2004.





10.133
            Limited
                Liability Company Agreement of CC Tollgate LLC dated as of October
                12,
                2004, is hereby incorporated by reference from Exhibit 10.133 to
                Century
                Casinos’ Quarterly Report on Form 10-Q for the quarterly period ended
                September 30, 2004.





10.134
            Casino
                Services Agreement by and between CC Tollgate LLC and Century Resorts
                International Limited dated October 12, 2004, is hereby incorporated
                by
                reference from Exhibit 10.134 to Century Casinos’ Quarterly Report on Form
                10-Q for the quarterly period ended September 30,
                2004.





10.136
            Third
                Amendment to Restated Credit Agreement dated October 27, 2004 among
                WMCK
                Venture Corp., Century Casinos Cripple Creek, WMCK Acquisition Corp.,
                Century Casinos, Inc. and Wells Fargo Bank, N.A., is hereby incorporated
                by reference from Exhibit 10.136 to Century Casinos’ Quarterly Report on
                Form 10-Q for the quarterly period ended September 30,
                2004.





10.137
            Amended
                and Restated Brokerage Agreement between Novomatic AG and Century
                Resort
                Limited (rights transferred from Century Casinos, Inc.) dated October
                1,
                2004, is hereby incorporated by reference from Exhibit 10.137 to
                Century
                Casinos’ Quarterly Report on Form 10-Q for the quarterly period ended
                September 30, 2004.





10.139
            Settlement
                of Loans Agreement between Century Resorts Limited, Century Casinos
                Africa
                (Proprietary) Limited, Silverstar Development Limited and Jose De
                Silva,
                effective December 1, 2004, is hereby incorporated by reference from
                Exhibit 10.139 to Century Casinos’ Current Report on Form 8-K, dated
                December 7, 2004.





-
            58
            -
 *Index*





10.141
            Option
                Agreement between Akani Leisure Investments (Proprietary) Limited
                (“Akani”) and Century Resorts Limited, transfer all rights to Akani,
                effective December 1, 2004, is hereby incorporated by reference from
                Exhibit 10.141 to Century Casinos’ Current Report on Form 8-K, dated
                December 7, 2004.





10.142
            Option
                Agreement between Akani Leisure Investments (Proprietary) Limited
                (“Akani”) and Century Casinos West Rand (Proprietary) Limited, transfer
                all rights to Akani, effective December 1, 2004, is hereby incorporated
                by
                reference from Exhibit 10.142 to Century Casinos’ Current Report on Form
                8-K, dated December 7, 2004.





10.143
            Amendment
                to Employment Agreement, Dr. Erwin Haitzmann, dated February 3, 2005,
                is
                hereby incorporated by reference from Exhibit 10.143 to Century Casinos’
                Current report on Form 8-K, dated February 3,
                2005.





10.144
            Amendment
                to Employment Agreement, Mag. Peter Hoetzinger, dated February 3,
                2005, is
                hereby incorporated by reference from Exhibit 10.144 to Century Casinos’
                Current Report on Form 8-K, dated February 3,
                2005.




10.145
            Assignment
                of Management Agreement by and between Century Casinos, Inc and Flyfish
                Casino Consulting AG, dated February 23, 2005, is hereby incorporated
                by
                reference from Exhibit 10.145 to Century Casinos’ Current Report on Form
                8-K, dated March 1, 2005.





10.146
            Assignment
                of Management Agreement by and between Century Casinos, Inc and Focus
                Casino Consulting AG, dated February 23, 2005, is hereby incorporated
                by
                reference from Exhibit 10.146 to Century Casinos’ Current Report on Form
                8-K, dated March 1, 2005.





10.147
            Employment
                Agreement by and between Century Casinos, Inc and Mr. Larry Hannappel,
                dated March 22, 2005, is hereby incorporated by reference from Exhibit
                10.147 to Century Casinos’ Current Report on Form 8-K, dated March 22,
                2005.





10.149
            Corrected
                Employment Agreement by and between Century Casinos, Inc. and Mr.
                Richard
                S. Rabin, Chief Operating Officer, North America dated April 27,
                2005, is
                hereby incorporated by reference from Exhibit 10.149 to Century Casinos’
                Amended Annual Report on Form 10-K/A for the fiscal year ended December
                31, 2004.





10.153
            Fourth
                Amendment to Amended and Restated Credit Agreement, dated as of September
                23, 2005, is hereby incorporated by reference from Exhibit 10.153
                to
                Century Casinos’ Current Report on Form 8-K, dated September 27,
                2005.





10.154
            Commitment
                letter by and between Century Resorts Alberta Inc. and Canadian Western
                Bank dated September 23, 2005, original commitment letter dated
                August 3, 2005 and amendments dated September 8, 2005 and September
                21,
                2005, is hereby incorporated by reference from Exhibit 10.154 to
                Century
                Casinos’ Current Report on Form 8-K, dated September 27,
                2005.





10.156
            Mandate
                Agreement, dated September 30, 2005, between Century Casinos, Inc.
                and
                Bank Austria Creditanstalt AG, is hereby incorporated by reference
                from
                Exhibit 10.156 to Century Casinos’ Current Report on Form 8-K, dated
                October 3, 2005.





-
            59
            -
 *Index*





10.157
            ADC
                Agreement, dated September 30, 2005, by and among Bank Austria
                Creditanstalt AG, Century Casinos, Inc., and Oesterreichische Kontrollbank
                Aktiengesellschaft, is hereby incorporated by reference from Exhibit
                10.157 to Century Casinos’ Current Report on Form 8-K, dated October 3,
                2005.





10.158
            Annex
                to ADC Agreement between Bank Austria Creditanstalt AG, Century Casinos,
                Inc. and Oesterreichische Kontrollbank Aktiengesellschaft dated September
                30, 2005, is hereby incorporated by reference from Exhibit 10.158
                to
                Century Casinos’ Quarterly Report on Form 10-Q for the quarterly period
                ended September 30, 2005.





10.159
            Shareholders’
                Agreement between Century Casinos Africa (Proprietary) Limited and
                Winlen
                Casino Operators (Proprietary) Limited dated November 21, 2005, is
                hereby
                incorporated by reference from Exhibit 10.159 to Century Casinos’ Current
                Report on Form 8-K, dated November 23,
                2005.





10.160
            Credit
                Agreement dated as of November 18, 2005 among CC Tollgate LLC, a
                Delaware
                limited liability company, as Borrower, the Lenders and L/C issuer
                herein
                named Wells Fargo Bank, National Association, as Agent Bank, is hereby
                incorporated by reference from Exhibit 10.160 to Century Casinos’ Current
                Report on Form 8-K, dated November 29,
                2005.





10.161
            Standard
                Form of Agreement Between Owner and Contractor where the basis for
                payment
                is the cost of the work plus a fee with a negotiated Guaranteed Maximum
                Price between the Owner, CC Tollgate LLC, and the Contractor, Sprung
                Construction, Inc., Subchapter S Corporation, dated April 6, 2005,
                is
                hereby incorporated by reference from Exhibit 10.161 to Century Casinos’
                Current Report on Form 8-K, dated December 8, 2005.





10.162
            Standard
                Form of Agreement Between Owner and Contractor where the basis for
                payment
                is the cost of the work plus a fee with a negotiated Guaranteed Maximum
                Price between the Owner, CC Tollgate LLC, and the Contractor, CFC
                Construction, Inc., dated July 21, 2005, is hereby incorporated by
                reference from Exhibit 10.162 to Century Casinos’ Current Report on Form
                8-K, dated December 8, 2005.





10.163
            Agreement
                between Century Resorts Alberta Inc. (owner) and Chandos Construction
                Ltd.
                (contractor) as of December 2, 2005, is hereby incorporated by reference
                from Exhibit 10.163 to Century Casinos’ Current Report on Form 8-K, dated
                December 8, 2005.





10.164
            Binding
                letter of intent between Century Resorts Alberta Inc., 746306 Alberta
                Ltd
                and Century Resorts International Ltd dated December 2, 2005 and
                accepted
                on December 6, 2005, is hereby incorporated by reference from Exhibit
                10.164 to Century Casinos’ Current Report on Form 8-K, dated December 12,
                2005.





10.165
            Fifth
                Amendment to Amended and Restated Credit Agreement, dated as of December
                6, 2005, is hereby incorporated by reference from Exhibit 10.165
                to
                Century Casinos’ Current Report on Form 8-K, dated December 12,
                2005.





10.166
            Century
                  Casinos, Inc. 2005 Equity Incentive Plan effective June 17, 2005,
                  is
                  hereby incorporated by reference from Appendix A to Century Casinos’ Proxy
                  Statement in respect of the 2005 Annual Meeting of
                  Stockholders.




10.167
              Employment
                  agreement, effective March 15, 2005, between Century Casinos, Inc.
                  and Mr.
                  Ray Sienko dated February 16, 2006.


-
            60
            -
 *Index*





*(14)
      Code of Ethics*





14
            Code
                of Ethics, is hereby incorporated by reference from Exhibit 14 to
                Century
                Casinos’ Annual Report on Form 10-K for the fiscal year ended December 31,
                2003.





*(21)
      Subsidiaries of the Registrant*





21
            Subsidiaries
                of the Registrant





*(23)
      Consents of Experts and Counsel*





23.1
            Consent
                of Independent Auditors - Grant Thornton
                LLP





23.2
            Consent
                of Independent Auditors - PricewaterhouseCoopers
                Inc.





*(31)
      Rule 13a-14(a)/15d-14(a) Certifications*





31.1
            Certification
                Pursuant to Securities Exchange Act Rule 13a-15(f) and 15d-15(f),
                Chairman
                of the Board and Co Chief Executive
                Officer.





31.2
            Certification
                Pursuant to Securities Exchange Act Rule 13a-15(f) and 15d-15(f),
                Vice-Chairman, President and Co Chief Executive
                Officer.





31.3
            Certification
                Pursuant to Securities Exchange Act Rule 13a-15(f) and 15d-15(f),
                Senior
                Vice-President





31.4
            Certification
                Pursuant to Securities Exchange Act Rule 13a-15(f) and 15d-15(f),
                Chief
                Accounting Officer.





*(32)
      Section 1350 Certifications*





32.1
            Certification
                Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Chairman
                of the
                Board and Co Chief Executive
                Officer.





32.2
            Certification
                Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Vice-Chairman,
                President and Co Chief Executive
                Officer.





32.3
            Certification
                Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Senior
                Vice-President.





32.4
            Certification
                Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Chief
                Accounting Officer.





-
            61
            -
 *Index*





**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) 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.





CENTURY
                CASINOS, INC.By:
                /s/ Erwin Haitzmann
            
            By:
                /s/ Peter HoetzingerErwin
                Haitzmann, Chairman of the Board and
              Co
                Chief Executive Officer
              (Co
                Principal Executive Officer)
            
            Peter
                Hoetzinger, Vice-Chairman of the Board,
              Co
                Chief Executive Officer and President
              (Co
                Principal Executive Officer)By:
                /s/ Larry Hannappel
            
            By:
                /s/ Ray SienkoLarry
                Hannappel, Senior Vice-President
              (Principal
                Financial Officer)
            
            Ray
                Sienko, Chief Accounting Officer
              (Principal
                Accounting Officer)Date: 
                March 8, 2006





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed by the following persons on behalf of the Registrant and in the
      capacities indicated on March
      8, 2006 .








Signature
            Title
            Signature
            Title/s/
                Erwin Haitzmann
              Erwin
                Haitzmann
            Chairman
                of the Board and
              Co
                Chief Executive Officer
            /s/
                Gottfried Schellmann
              Gottfried
                Schellmann
            Director/s/
                Peter Hoetzinger
              Peter
                Hoetzinger
            Vice
                Chairman of the Board,
              Co
                Chief Executive Officer
              and
                President
            /s/
                Robert S. Eichberg
              Robert
                S. Eichberg
            Director/s/
                Dinah Corbaci
              Dinah
                Corbaci
            Director




-
            62
            -
 *Index*


**REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
        FIRM**
  Board
        of
        Directors and Shareholders
 of
        Century Casinos, Inc.
 We
          have audited the accompanying consolidated balance sheets of Century Casinos,
          Inc. (a Delaware corporation) and subsidiaries (the “Company”) as of
          December 31, 2005 and 2004, and the related consolidated statements of
          earnings, shareholders’ equity and comprehensive income, and cash flows for each
          of the three years in the period ended December 31, 2005. These financial
          statements are the responsibility of the Company’s management. Our
          responsibility is to express an opinion on these financial statements based
          on
          our audits. We did not audit the consolidated financial statements of Century
          Casinos Africa (Proprietary) Limited (CCA), a 96.5 percent subsidiary,
          for the
          year ended December 31, 2003, which statements reflect total assets of 36
          percent of the consolidated total assets as of December 31, 2003 and total
          revenues of 36 percent of the consolidated total revenue for the year ended
          December 31, 2003. These statements were audited by other auditors, whose
          report thereon has been furnished to us, and our opinion, insofar as it
          relates
          to the amounts included for CCA for 2003, is based solely on the report
          of the
          other auditors.
 
 We
          conducted our audits in accordance with the standards of the Public Company
          Accounting Oversight Board (United States). Those standards require that
          we plan
          and perform the audit to obtain reasonable assurance about whether the
          financial
          statements are free of material misstatement. An audit includes examining,
          on a
          test basis, evidence supporting the amounts and disclosures in the financial
          statements. An audit also includes assessing the accounting principles
          used and
          significant estimates made by management, as well as evaluating the overall
          financial statement presentation. We believe that our audits provide a
          reasonable basis for our opinion.
 
 In
          our opinion, the financial statements referred to above present fairly,
          in all
          material respects, the financial position of Century Casinos, Inc. and
          subsidiaries as of December 31, 2005 and 2004, and the results of their
          operations and their cash flows for each of the three years in the period
          ended
          December 31, 2005 in conformity with accounting principles generally
          accepted in the United States of America.
 
 We
          also have audited, in accordance with the standards of the Public Company
          Accounting Oversight Board (United States), the effectiveness of Century
          Casinos, Inc. and subsidiaries’ internal control over financial reporting as of
          December 31, 2005, based on criteria established in *Internal
          Control—Integrated Framework* issued by the Committee of Sponsoring Organizations of the Treadway Commission
          (COSO) and our report dated March 3, 2006 expressed unqualified
          opinions.
  
 /s/
          GRANT THORNTON LLP
  Denver,
          Colorado
 March 3,
          2006
  -F1-
 *Index*
  **REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
  Board
            of
            Directors and Shareholders
 of
            Century Casinos, Inc.
  We
            have audited management’s assessment, included in the accompanying Management’s
            Report on Internal Control over Financial Reporting appearing under
            Item 9A, that Century Casinos, Inc. (a Delaware Corporation) and
            subsidiaries (the “Company”) maintained effective internal control over
            financial reporting as of December 31, 2005, based on criteria established
            in *Internal
            Control—Integrated Framework* issued by the Committee of Sponsoring Organizations of the Treadway Commission
            (COSO). Century Casinos, Inc.’s management is responsible for maintaining
            effective internal control over financial reporting and for its assessment
            of
            the effectiveness of internal control over financial reporting. Our
            responsibility is to express an opinion on management’s assessment and an
            opinion on the effectiveness of the Company’s internal control over financial
            reporting based on our audit.
 
 We
            conducted our audit in accordance with the standards of the Public Company
            Accounting Oversight Board (United States). Those standards require that
            we plan
            and perform the audit to obtain reasonable assurance about whether effective
            internal control over financial reporting was maintained in all material
            respects. Our audit included obtaining an understanding of internal control
            over
            financial reporting, evaluating management’s assessment, testing and evaluating
            the design and operating effectiveness of internal control, and performing
            such
            other procedures as we considered necessary in the circumstances. We
            believe
            that our audit provides a reasonable basis for our opinions.
 
 A
            company’s internal control over financial reporting is a process designed to
            provide reasonable assurance regarding the reliability of financial reporting
            and the preparation of financial statements for external purposes in
            accordance
            with generally accepted accounting principles. A company’s internal control over
            financial reporting includes those policies and procedures that (1) pertain
            to
            the maintenance of records that, in reasonable detail, accurately and
            fairly
            reflect the transactions and dispositions of the assets of the company;
            (2)
            provide reasonable assurance that transactions are recorded as necessary
            to
            permit preparation of financial statements in accordance with generally
            accepted
            accounting principles, and that receipts and expenditures of the company
            are
            being made only in accordance with authorizations of management and directors
            of
            the company; and (3) provide reasonable assurance regarding prevention
            or timely
            detection of unauthorized acquisition, use, or disposition of the company’s
            assets that could have a material effect on the financial
            statements.
 
 Because
            of its inherent limitations, internal control over financial reporting
            may not
            prevent or detect misstatements. Also, projections of any evaluation
            of
            effectiveness to future periods are subject to the risk that controls
            may become
            inadequate because of changes in conditions, or that the degree of compliance
            with the policies or procedures may deteriorate.
  -F2-
  In
            our
            opinion, management’s assessment that Century Casinos, Inc. and subsidiaries,
            maintained effective internal control over financial reporting as of
            December 31, 2005, is fairly stated, in all material respects, based on
            criteria established in*Internal
            Control—Integrated Framework*issued
            by the Committee of Sponsoring Organizations of the Treadway Commission
            (COSO).
            Also in our opinion, Century Casinos, Inc. and subsidiaries maintained,
            in all
            material respects, effective internal control over financial reporting
            as of
            December 31, 2005, based on criteria established in*Internal
            Control—Integrated Framework*issued
            by the Committee of Sponsoring Organizations of the Treadway Commission
            (COSO).
 
 We
            also
            have audited, in accordance with the standards of the Public Company
            Accounting
            Oversight Board (United States), the consolidated balance sheets of Century
            Casinos, Inc. (a Delaware corporation) and subsidiaries as of December 31,
            2005 and 2004, and the related consolidated statements of earnings,
            shareholders’ equity and comprehensive income, and cash flows for each of the
            three years in the period ended December 31, 2005 and our report dated
            March 3, 2006 expressed an unqualified opinion on those financial
            statements.
  
 /s/
            GRANT
            THORNTON LLP
 
 Denver,
            Colorado
 March
            3,
            2006
 -F3-
 *Index*
  **REPORT
        OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF CENTURY CASINOS AFRICA
        (PROPRIETARY) LIMITED**
 We
          have
          audited the consolidated balance sheets of Century Casinos Africa (Proprietary)
          Limited and subsidiaries as at December 31, 2003 and 2002 and related
          consolidated income statements, cash flow statements and statements of
          changes
          in shareholders’ equity for the years then ended (not presented herein). These
          financial statements are the responsibility of the directors of the Company.
          Our
          responsibility is to express an opinion on these financial statements based
          on
          our audit.
 
 **Scope**
 We
          conducted our audit in accordance with auditing standards generally accepted
          in
          South Africa and in the United States of America. Those standards require
          that
          we plan and perform the audit to obtain reasonable assurance about whether
          the
          consolidated financial statements (not presented herein) are free of material
          misstatement. An audit includes:
 -  examining,
          on a test basis, evidence supporting the amounts and disclosures included
          in the
          financial statements,
 -  assessing
          the accounting principles used and significant estimates made by management,
          and
 -  evaluating
          the overall financial statement presentation.
 We
          believe that our audit provides a reasonable basis for our opinion.
 
 **Audit
          Opinion**
 In
          our
          opinion, the consolidated financial statements referred to above present
          fairly,
          in all material respects, the consolidated financial position of Century
          Casinos
          Africa (Proprietary) Limited and its subsidiaries at December 31, 2003
          and 2002
          and the consolidated results of their operations, cash flow and changes
          in
          shareholders’ equity for the years then ended in conformity with South African
          Statements of Generally Accepted Accounting Practice, and in the manner
          required
          by the South African Companies Act, 1973.
 
 Accounting
          principles generally accepted in South Africa differ in certain significant
          respects from accounting principles generally accepted in the United States
          of
          America and as allowed by Item 17 to Form 20-F. The application of the
          latter
          would have affected the determination of consolidated net income expressed
          in
          South African Rand for the years ended 31 December 2003 and 2002 and the
          determination of consolidated shareholders’ equity expressed in South African
          Rand at 31 December 2003 and 2002 to the extent summarised in Note 28 (not
          presented herein) to the financial statements.
 
 /s/
          PricewaterhouseCoopers Inc.
 PRICEWATERHOUSECOOPERS
          INC.
 Chartered
          Accountants (SA)
 Registered
          Accountants and Auditors
 
 Cape
          Town
 1
          March
          2004
 
 -F4-
 *Index*
  **CENTURY
        CASINOS, INC. AND SUBSIDIARIES**
 CONSOLIDATED
        BALANCE SHEETS
 
 *Amounts
                    shown in thousands, except share information*
                
                **December
                    31, 2005**
                
                **December
                    31, 2004****ASSETS****Current
                    Assets:**Cash
                    and cash equivalents
                
                $
                37,167
                
                $
                8,411Restricted
                    cash
                
                
                947
                
                
                706Receivables,
                    net
                
                
                293
                
                
                193Prepaid
                    expenses
                
                
                518
                
                
                437Inventories
                
                
                209
                
                
                215Other
                    current assets
                
                
                927
                
                
                28Deferred
                    income taxes - domestic
                
                
                -
                
                
                97-
                    foreign
                
                
                72
                
                
                88Total
                    current assets
                
                
                40,133
                
                
                10,175**Property
                    and Equipment, net**
                
                
                69,602
                
                
                48,629**Goodwill**
                
                
                8,662
                
                
                8,845**Casino
                    Licences**
                
                
                1,845
                
                
                2,061**Deferred
                    Income Taxes - foreign**
                
                
                380
                
                
                207**Equity
                    Investment in Unconsolidated Subsidiary**
                
                
                -
                
                
                116**Other
                    Assets**
                
                
                2,941
                
                
                1,171**Total**
                
                $
                123,563
                
                $
                71,204
 
 **LIABILITIES
                    AND SHAREHOLDERS’ EQUITY****Current
                    Liabilities:**Current
                    portion of long-term debt
                
                $
                1,789
                
                $
                2,534Accounts
                    payable and accrued liabilities
                
                
                5,504
                
                
                3,548Accrued
                    payroll
                
                
                1,149
                
                
                1,372Taxes
                    payable
                
                
                1,189
                
                
                711Other
                
                
                8
                
                
                102Total
                    current liabilities
                
                
                9,639
                
                
                8,267**Long-Term
                    Debt, less current portion**
                
                
                17,934
                
                
                17,970**Deferred
                    Tax Li****ability
                    - domestic**
                
                
                215
                
                
                234**Minority
                    Interest**
                
                
                4,444
                
                
                4,354**Commitments
                    and Contingencies****Shareholders’
                    Equity:**Preferred
                    stock; $.01 par value; 20,000,000 shares authorized; no shares
                    issued and
                    outstanding
                
                
                -
                
                
                -Common
                    stock; $.01 par value; 50,000,000 shares authorized; 22,568,443
                    and
                    14,485,776 shares issued, respectively; 22,380,567 and 13,694,900
                    shares
                    outstanding, respectively
                
                
                226
                
                
                145Additional
                    paid-in capital
                
                
                68,571
                
                
                21,528Accumulated
                    other comprehensive income
                
                
                2,568
                
                
                4,597Retained
                    earnings
                
                
                20,391
                
                
                15,91091,756
                
                
                42,180Treasury
                    stock - 187,876 and 790,876 shares at cost, respectively
                
                
                (425
                )
                
                (1,801
                )Total
                    shareholders’ equity
                
                
                91,331
                
                
                40,379**Total**
                
                $
                123,563
                
                $
                71,204
 
 See
          notes
          to consolidated financial statements
  -F5-
 *Index*
 **CENTURY
                CASINOS, INC. AND SUBSIDIARIES**
 CONSOLIDATED
                STATEMENTS OF EARNINGS
 
  **2005**
                      
                      **2004**
                      
                      **2003****Operating
                          Revenue:**Casino
                      
                      $
                      36,394
                      
                      $
                      34,641
                      
                      $
                      31,869Hotel,
                          food and beverage
                      
                      
                      4,522
                      
                      
                      4,322
                      
                      
                      3,568Other
                      
                      
                      783
                      
                      
                      1,092
                      
                      
                      65041,699
                      
                      
                      40,055
                      
                      
                      36,087Less
                          promotional allowances
                      
                      
                      (4,254
                      )
                      
                      (4,290
                      )
                      
                      (4,657
                      )Net
                          operating revenue
                      
                      
                      37,445
                      
                      
                      35,765
                      
                      
                      31,430**Operating
                          Costs and Expenses:**Casino
                      
                      
                      14,293
                      
                      
                      13,760
                      
                      
                      11,667Hotel,
                          food and beverage
                      
                      
                      2,776
                      
                      
                      3,134
                      
                      
                      2,553General
                          and administrative
                      
                      
                      11,073
                      
                      
                      8,925
                      
                      
                      7,710Depreciation
                      
                      
                      3,349
                      
                      
                      2,993
                      
                      
                      2,668Total
                          operating costs and expenses
                      
                      
                      31,491
                      
                      
                      28,812
                      
                      
                      24,598**(Loss)
                          earnings from unconsolidated subsidiary**
                      
                      
                      (109
                      )
                      
                      55
                      
                      
                      -**Earnings
                          from Operations**
                      
                      
                      5,845
                      
                      
                      7,008
                      
                      
                      6,832**Non-Operating
                          Income (Expense)**Interest
                          income
                      
                      
                      476
                      
                      
                      168
                      
                      
                      204Interest
                          expense
                      
                      
                      (2,109
                      )
                      
                      (1,587
                      )
                      
                      (2,011
                      )Early
                          debt repayment expense
                      
                      
                      (181
                      )
                      
                      -
                      
                      
                      -Gain
                          on foreign currency translation and other
                      
                      
                      13
                      
                      
                      1
                      
                      
                      20Non-operating
                          items from unconsolidated subsidiary
                      
                      
                      (4
                      )
                      
                      (5
                      )
                      
                      -Non-operating
                          expense, net
                      
                      
                      (1,805
                      )
                      
                      (1,423
                      )
                      
                      (1,787
                      )**Earnings
                          before Income Taxes and Minority Interest**
                      
                      
                      4,040
                      
                      
                      5,585
                      
                      
                      5,045Provision
                          for income taxes
                      
                      
                      347
                      
                      
                      749
                      
                      
                      1,777**Earnings
                          before Minority Interest**
                      
                      
                      3,693
                      
                      
                      4,836
                      
                      
                      3,268Minority
                          interest in subsidiary losses (earnings)
                      
                      
                      788
                      
                      
                      (98
                      )
                      
                      (22
                      )**Net
                          Earnings**
                      
                      $
                      4,481
                      
                      $
                      4,738
                      
                      $
                      3,246**Earnings
                          Per Share****Basic**
                      
                      $
                      0.28
                      
                      $
                      0.35
                      
                      $
                      0.24**Diluted**
                      
                      $
                      0.25
                      
                      $
                      0.30
                      
                      $
                      0.22
 
 See
                notes
                to consolidated financial statements
  -F6-
 *Index*
  **CENTURY
                CASINOS, INC. AND
                SUBSIDIARIES**
 CONSOLIDATED
                STATEMENTS OF SHAREHOLDERS’ EQUITY AND COMPREHENSIVE INCOME
 FOR
                THE
                YEARS ENDED DECEMBER 31, 2005, 2004 and 2003
 
 (Amounts
                shown in thousands, except share information)
  Common
                          Stock
                      
                      Additional
                        Paid-in
                      
                      Accumulated
                        Other
                        Comprehensive
                      
                      Retained
                      
                      Treasury
                          StockShares
                      
                      Amt
                      
                      Capital
                      
                      Income
                          (Loss)
                      
                      Earnings
                      
                      Shares
                      
                      Amount
                      
                      TotalBALANCE
                          AT JANUARY 1, 2003
                      
                      
                      14,485,776
                      
                      $
                      145
                      
                      $
                      21,874
                      
                      $
                      (1,052
                      )
                      $
                      7,926
                      
                      
                      904,912
                      
                      $
                      (1,790
                      )
                      $
                      27,103Purchases
                          of treasury stock
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      59,100
                      
                      
                      (131
                      )
                      
                      (131
                      )Purchase
                          of treasury stock from former director
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      489,264
                      
                      
                      (1,106
                      )
                      
                      (1,106
                      )Options
                          exercised
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (345
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      (648,000
                      )
                      
                      1,195
                      
                      
                      850Foreign
                          currency translation adjustment
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      2,824
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      2,824Change
                          in fair value of interest rate swap, net of income tax
                          expense
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      782
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      782Reclassification
                          of interest expense on interest rate swap
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (520
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (520
                      )Net
                          earnings
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      3,246
                      
                      
                      -
                      
                      
                      -
                      
                      
                      3,246BALANCE
                          AT DECEMBER 31, 2003
                      
                      
                      14,485,776
                      
                      $
                      145
                      
                      $
                      21,529
                      
                      $
                      2,034
                      
                      $
                      11,172
                      
                      
                      805,276
                      
                      $
                      (1,832
                      )
                      $
                      33,048Options
                          exercised
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (1
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      (14,400
                      )
                      
                      31
                      
                      
                      30Foreign
                          currency translation adjustment
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      2,775
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      2,775Reclassification
                          of the amount of accumulated foreign currency translation
                          adjustment from
                          other comprehensive income to earnings attributable to
                          the sale of
                          Verkrans
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (380
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (380
                      )Change
                          in fair value of interest rate swap, net of income tax
                          expense
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      428
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      428Reclassification
                          of interest expense on interest rate swap
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (260
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (260
                      )Net
                          earnings
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      4,738
                      
                      
                      -
                      
                      
                      -
                      
                      
                      4,738BALANCE
                          AT DECEMBER 31, 2004
                      
                      
                      14,485,776
                      
                      $
                      145
                      
                      $
                      21,528
                      
                      $
                      4,597
                      
                      $
                      15,910
                      
                      
                      790,876
                      
                      $
                      (1,801
                      )
                      $
                      40,379Issuance
                          of common stock, net of $3.0 million in issuance costs
                      
                      
                      7,132,667
                      
                      
                      71
                      
                      
                      46,116
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      46,187Options
                          exercised
                      
                      
                      950,000
                      
                      
                      10
                      
                      
                      927
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (603,000
                      )
                      
                      1,376
                      
                      
                      2,313Foreign
                          currency translation adjustment
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (2,093
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (2,093
                      )Change
                          in fair value of interest rate swap, net of income tax
                          expense
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      166
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      166Reclassification
                          of interest expense on interest rate swap
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (102
                      )
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (102
                      )Net
                          earnings
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      4,481
                      
                      
                      -
                      
                      
                      -
                      
                      
                      4,481BALANCE
                          AT DECEMBER 31, 2005
                      
                      
                      22,568,443
                      
                      $
                      226
                      
                      $
                      68,571
                      
                      $
                      2,568
                      
                      $
                      20,391
                      
                      
                      187,876
                      
                      $
                      (425
                      )
                      $
                      91,331
 
 **See
                notes to consolidated financial statements**
  -F7-
 *Index*
  **CENTURY
                CASINOS, INC. AND SUBSIDIARIES**
 CONSOLIDATED
                STATEMENTS OF CASH FLOWS
 
 
 *Amounts
                          shown in thousands*
                      
                      **For
                          the Year Ended December 31,****2005**
                      
                      **2004**
                      
                      **2003****Cash
                          Flows from Operating Activities:**Net
                          earnings
                      
                      $
                      4,481
                      
                      $
                      4,738
                      
                      $
                      3,246Adjustments
                          to reconcile net earnings to net cash provided by operating
                          activitiesDepreciation
                      
                      
                      3,349
                      
                      
                      2,993
                      
                      
                      2,668Amortization
                          of deferred financing costs
                      
                      
                      448
                      
                      
                      75
                      
                      
                      113Gain
                          on disposition of assets and real estate option
                      
                      
                      (74
                      )
                      
                      (20
                      )
                      
                      (28
                      )Deferred
                          tax (benefit) expense
                      
                      
                      (147
                      )
                      
                      554
                      
                      
                      199Minority
                          interest in subsidiary (losses) earnings
                      
                      
                      (788
                      )
                      
                      98
                      
                      
                      22Loss
                          (earnings) from unconsolidated subsidiary
                      
                      
                      109
                      
                      
                      (55
                      )
                      
                      -Reclassification
                          of accumulated foreign currency translation adjustment
                          attributable to the
                          sale of Verkrans
                      
                      
                      -
                      
                      
                      (380
                      )
                      
                      -Write
                          down of Nevada property held for sale
                      
                      
                      32
                      
                      
                      -
                      
                      
                      -Other
                      
                      
                      -
                      
                      
                      -
                      
                      
                      20Changes
                          in operating assets and liabilitiesReceivables
                      
                      
                      (151
                      )
                      
                      110
                      
                      
                      (118
                      )Prepaid
                          expenses and other assets
                      
                      
                      (888
                      )
                      
                      (357
                      )
                      
                      (236
                      )Accounts
                          payable and accrued liabilities
                      
                      
                      2,760
                      
                      
                      1,282
                      
                      
                      (394
                      )Accrued
                          payroll
                      
                      
                      (177
                      )
                      
                      43
                      
                      
                      110Taxes
                          payable
                      
                      
                      546
                      
                      
                      (609
                      )
                      
                      219Net
                          cash provided by operating activities
                      
                      
                      9,500
                      
                      
                      8,472
                      
                      
                      5,821**Cash
                          Flows from Investing Activities:**Purchases
                          of property and equipment
                      
                      
                      (23,152
                      )
                      
                      (4,508
                      )
                      
                      (2,585
                      )Acquisition
                          of remaining interest in subsidiary
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (1,259
                      )Cash
                          contribution of $2,432 towards interest in subsidiary,
                          less net cash
                          acquired of $1,679
                      
                      
                      (753
                      )
                      
                      -
                      
                      
                      -Investment
                          in subsidiary
                      
                      
                      -
                      
                      
                      (3,500
                      )
                      
                      -Proceeds
                          from disposition of subsidiary
                      
                      
                      -
                      
                      
                      753
                      
                      
                      -Proceeds
                          from disposition of assets
                      
                      
                      264
                      
                      
                      205
                      
                      
                      308Net
                          cash used in investing activities
                      
                      
                      (23,641
                      )
                      
                      (7,050
                      )
                      
                      (3,536
                      )
 
 -Continued
                on following page-
  -F8-
 *Index*
  **CENTURY
                CASINOS, INC. AND SUBSIDIARIES**
 CONSOLIDATED
                STATEMENTS OF CASH FLOWS
 
 
 *Amounts
                          shown in thousands*
                      
                      **For
                          the Year Ended December 31,****2005**
                      
                      **2004**
                      
                      **2003****Cash
                          Flows from Financing Activities:**Proceeds
                          from borrowings
                      
                      $
                      58,680
                      
                      $
                      31,462
                      
                      $
                      27,269Principal
                          repayments
                      
                      
                      (59,467
                      )
                      
                      (29,479
                      )
                      
                      (29,478
                      )Distribution
                          to minority interest
                      
                      
                      (1,000
                      )
                      
                      -
                      
                      
                      -Deferred
                          financing costs
                      
                      
                      (2,419
                      )
                      
                      (113
                      )
                      
                      -(Increase)
                          decrease in restricted cash
                      
                      
                      (387
                      )
                      
                      -
                      
                      
                      64Proceeds
                          from exercise of options
                      
                      
                      2,313
                      
                      
                      31
                      
                      
                      850Proceeds
                          from issuance of Austrian Depositary Certificates, net
                          of $3.0 million in
                          issuance costs
                      
                      
                      46,187
                      
                      
                      -
                      
                      
                      -Purchases
                          of treasury stock
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (1,237
                      )Loss
                          in non-operating items from unconsolidated subsidiary
                      
                      
                      4
                      
                      
                      5
                      
                      
                      -Net
                          cash provided by (used in) financing activities
                      
                      
                      43,911
                      
                      
                      1,906
                      
                      
                      (2,532
                      )Effect
                          of exchange rate changes on cash
                      
                      
                      (1,014
                      )
                      
                      354
                      
                      
                      394**Increase
                          in Cash and Cash Equivalents**
                      
                      
                      28,756
                      
                      
                      3,682
                      
                      
                      147**Cash
                          and Cash Equivalents at Beginning of Year**
                      
                      
                      8,411
                      
                      
                      4,729
                      
                      
                      4,582**Cash
                          and Cash Equivalents at End of Year**
                      
                      $
                      37,167
                      
                      $
                      8,411
                      
                      $
                      4,729
 
 **Supplemental
                Disclosure of Noncash Investing and Financing Activities:**
 On
                  February 24, 2005, our wholly owned subsidiary, Century Resorts
                  International
                  Limited, purchased a 56.4% (56.4 shares) equity interest in Century
                  Resorts
                  Alberta, Inc. for the purpose of operating the proposed casino
                  and hotel by
                  contributing $2.4 million in cash to Century Resorts Alberta, Inc.
                  In
                  conjunction with this acquisition, we assumed the following assets
                  and
                  liabilities:
 
 *Amounts
                            in thousands*Fair
                            value of cash acquired
                        
                        
                        1,679Fair
                            value of property and equipment acquired
                        
                        
                        2,631Amount
                            credited to minority partner
                        
                        
                        (1,878
                        )Cash
                            paid
                        
                        $
                        2,432
 The
                assets acquired and liabilities assumed are reported in the consolidated
                balance
                sheet. Century Resorts Alberta Inc. is a new entity and pro forma
                information is
                not applicable.
 
 In
                January 2004, the Company, through its wholly owned subsidiary Century
                Casinos
                Europe GmbH (“CCE”), purchased an additional 40% interest in Casino Millennium
                (“CM”), bringing its total interest to 50%, by contributing gaming equipment
                with a net book value of $0.6 million. The contribution of the gaming
                equipment,
                along with a cash contribution made in December 2002 which was accounted
                for by
                CCE on a cost basis in Euro and had a value of $0.3 million on January
                3, 2004,
                brought the Company’s total investment in CM to $0.9 million, of which $0.3
                million was allocated to a shareholder loan acquired as part of the
                transaction.
                The difference between the cost and the equity of CM, of $0.6 million,
                has been
                recorded as goodwill.
  In
                  December 2004, the Company, through its wholly owned subsidiary
                  Century Casinos
                  Tollgate, Inc. (“CTI”), purchased a 65% interest in CC Tollgate LLC. In
                  conjunction with the acquisition, we assumed the following assets
                  and
                  liabilities:
  -F9-
 *Index*
  **CENTURY
                CASINOS, INC. AND SUBSIDIARIES**
 CONSOLIDATED
                STATEMENTS OF CASH FLOWS (CONTINUED)
 
 *Amounts
                          in thousands*Fair
                          value of property and equipment acquired
                      
                      $
                      9,205Fair
                          value of long term debt acquired
                      
                      
                      (4,582
                      )Amount
                          credited to minority partner
                      
                      
                      (1,000
                      )Fair
                          value of accounts payable and other accrued liabilities
                          assumed by
                          CCI
                      
                      
                      (123
                      )Cash
                          paid
                      
                      $
                      3,500
 
 The
                assets acquired and liabilities assumed are reported in the consolidated
                balance
                sheet. CC Tollgate LLC is a new entity and pro forma information
                is not
                applicable.
 
 In
                January 2003, we, through Century Casinos Africa (Pty) Limited (“CCA”),
                purchased the remaining 35% interest in Century Casinos Caledon (Pty)
                Limited
                (“CCAL”) for a total of $2.6 million, of which $1.3 million was used to
                purchase
                a loan from the previous minority shareholder, Caledon Overberg Investments
                (Proprietary) Limited (“COIL”), and is included in principal repayments above,
                $1.0 million was applied to the minority shareholder liability and
                $0.3 million
                increased the carrying value of the land in Caledon.
 
 In
                the
                second quarter of 2003, James Forbes, a director of the Company at
                the time, in
                accordance with our Employee’s Equity Incentive Plan (“EEIP”), exercised all
                618,000 of his outstanding options, carrying an average strike price
                of $1.31.
                The shares were issued out of treasury stock and payment for the
                options was
                made by transferring 357,080 shares of common stock that the director
                had owned
                since 1994 to the Company at a per share price of $2.26 established
                at the close
                of market on April 16, 2003.
 
 **Supplemental
                Disclosure of Cash Flow Information:**
 Amounts
                          shown in thousands
                      
                      2005
                      
                      2004
                      
                      2003Interest
                          paid, net of capitalized interest of $582 in 2005, $0 in
                          2004 and $46 in
                          2003
                      
                      $
                      1,890
                      
                      $
                      1,504
                      
                      $
                      2,057Income
                          taxes paid
                      
                      $
                      1,083
                      
                      $
                      614
                      
                      $
                      1,090
 
 See
                notes
                to consolidated financial statements
  -F10-
 *Index*
  **CENTURY
                CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                TO
                CONSOLIDATED FINANCIAL STATEMENTS
 
 
 **1.**
                      **DESCRIPTION
                          OF BUSINESS**
 
 Century
                Casinos, Inc. (“CCI” or the “Company”) is an international gaming company. We
                own and/or manage casino operations in the United States, South Africa,
                the
                Czech Republic and international waters through various entities
                that are wholly
                owned or in which we have a majority ownership position:
 
 **Parent/Subsidiary
                          Relationship**
                      **Abbreviation**
                      **Parent**
                      **Ownership
                          Percentage****Century
                          Casinos, Inc.**
                      **CCI**
                      **n/a**
                      **n/a****WMCK
                          Venture Corp.**
                      **WMCK**
                      **CCI**
                      **100%**WMCK-Acquisition
                          Corp.
                      ACQ
                      WMCK
                      100%Century
                          Casinos Cripple Creek, Inc.
                      CCC
                      WMCK
                      100%**Century
                          Resorts Limited**
                      **CRL**
                      **CCI**
                      **96.5%**Blue
                          Bells Country Club (Pty) Ltd.
                      BBC
                      CRL
                      100%Blue
                          Crane Signature Golf Estates (Pty) Ltd.
                      BCS
                      CRL
                      100%Century
                          Casinos Africa (Pty) Ltd.
                      CCA
                      CRL
                      100%Century
                          Casinos Caledon (Pty) Ltd.
                      CCAL
                      CCA
                      100%Century
                          Casinos West Rand (Pty) Ltd. (Dormant)
                      CCWR
                      CCA
                      55%Rhino
                          Resort Ltd. (Dormant)
                      RRL
                      CCA
                      50%**Century
                          Resorts International Limited**
                      **CRI**
                      **CCI**
                      **100%**Century
                          Resorts Alberta, Inc.
                      CRA
                      CRI
                      56.4%**Century
                          Casinos Tollgate, Inc**
                      **CTI**
                      **CCI**
                      **100%**CC
                          Tollgate LLC
                      CTL
                      CTI
                      65%**Century
                          Casinos Iowa, Inc. (Dormant)**
                      **CIA**
                      **CCI**
                      **100%****Century
                          Casinos Management, Inc.**
                      **CCM**
                      **CCI**
                      **100%****Century
                          Casinos Nevada, Inc. (Dormant)**
                      **CCN**
                      **CCI**
                      **100%****Century
                          Casinos Europe GmbH**
                        ***(formerly
                          Century Management u. Beteiligungs GmbH)***
                      **CCE**
                      **CCI**
                      **100%**
 
 **CCI** serves
                as a holding company, providing corporate and administrative services
                to its
                subsidiaries.
 
 **WMCK** owns and
                operates Womacks Casino and Hotel (“Womacks”), a limited-stakes gaming casino in
                Cripple Creek, Colorado.
 
 **CRL** was
                formed to own our South African interests and to provide technical
                casino
                services to some of our foreign and offshore operations. CCI owns
                96.5% of CRL.
                Certain officers of the Company and their respective family trusts
                own the
                remaining 3.5% of CRL. CCAL, which is the primary operating unit
                of CRL, owns
                and operates The Caledon Hotel, Spa and Casino (“Caledon”) near Cape Town, South
                Africa.
  -F11-
 *Index*
 **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 **CRI** serves
                  as concessionaire of small casinos on luxury cruise vessels and
                  provides
                  technical casino services to Casino Millennium, a casino located
                  within a
                  five-star hotel in Prague, Czech Republic. **** CRI
                  owns
                  56.4% of CRA which was formed in conjunction with the development
                  of a casino
                  and hotel in Edmonton, Alberta, Canada. CRI has entered into casino
                  services
                  agreements and/or executive management agreements for which it
                  earns a fee with
                  other subsidiaries of CCI.
 
 **CTI** has
                  a 65%
                  controlling interest in CC Tollgate LLC, which was formed to develop
                  and operate
                  a casino and hotel in Central City, Colorado.
 
 **CCM** provided
                  technical casino services to Casino Millennium and provides management
                  services
                  to CC Tollgate LLC. The technical services agreement with Casino
                  Millennium was
                  assigned to CRI in October 2003, but CCM is still collecting fees that were
                  earned prior to that time, which remain unpaid.
 
 **CCE** has a
                  50% equity interest in Casino Millennium. CCE’s portion of Casino Millennium’s
                  earnings and losses are reported as earnings (loss) from unconsolidated
                  subsidiary in our consolidated statements of earnings and cash
                  flows. CCE also
                  provides administrative support for CCI executive management in
                  Europe.
 
 **We
                  regularly pursue additional gaming opportunities internationally
                  and in the
                  United States, and are currently pursuing the following opportunities:**
 
 **Central
                  City, Colorado** - On
                  October 13, 2004, our wholly owned subsidiary, CTI, entered into
                  an agreement
                  with Tollgate Venture LLC to develop and operate a proposed casino
                  and hotel in
                  Central City, Colorado. The $48.7 million development is planned
                  to include a
                  60,000 square foot casino and back of house with 625 slot machines,
                  six table
                  games, 27 hotel rooms, retail, food and beverage amenities and
                  a 500 space
                  on-site covered parking garage. We contributed $3.5 million cash
                  equity to the
                  project through CTI in exchange for a controlling 65% interest,
                  and Tollgate
                  Venture LLC contributed three existing non-operating casino buildings,
                  land and
                  land options valued at $5.7 million, net of mortgages, for a 35%
                  interest. Of
                  the $48.7 million in overall project costs, $3.5 million were originally
                  contributed by us as cash equity, $39.5 million will be financed
                  externally, and
                  the balance of $5.7 million is the net value of the minority partner’s
                  contribution. CCM has entered into a Casino Services Agreement
                  to manage the
                  property. On August 2, 2005, we secured $4.5 million in additional
                  funding from
                  a private investor, which was subsequently paid from the proceeds
                  of our Vienna
                  Stock Exchange offering (See Note 8 for additional information).
                  On November 21,
                  2005, we entered into a $35 million loan agreement with Wells Fargo
                  Bank and a
                  syndicate of institutional lenders (See Note 6 for additional
                  information).
 
 **Edmonton,
                  Alberta, Canada** - On
                  February 24, 2005, through our wholly owned subsidiary, CRI, we
                  acquired a 56.4% interest in CRA for approximately $2.4 million.
                  Our local
                  partner, 746306 Alberta, Ltd., contributed a 7.25-acre parcel of land and
                  an existing 40 room hotel for the remaining 43.6% interest. On
                  January 12, 2006,
                  the Company purchased the remaining 43.6% minority shareholder
                  interest in CRA
                  for approximately $6.3 million ($7.3 million Canadian). The Company
                  paid
                  approximately $5.0 million ($5.8 million Canadian) at closing with
                  the remainder
                  payable on the first anniversary of the opening of the casino.
                  CRA is developing
                  a casino and hotel in Edmonton, Alberta, Canada. Excluding the
                  costs to purchase
                  the minority shareholder’s interest, the $30.5 million ($35.8 million Canadian)
                  development is expected to include a casino with 600 gaming machines,
                  31 gaming
                  tables, food and beverage amenities, a dinner theater, a 300 space
                  underground
                  parking facility, approximately 600 surface parking spaces and
                  a 26-room hotel.
                  Of the $30.5 million in overall project costs, we contributed $2.4
                  million ($3.0
                  million Canadian) for our interest in CRA, $17.2 million ($20.0
                  million
                  Canadian) will be financed through external financing, $9.0 million
                  ($10.5
                  million Canadian) will be provided by us as a shareholder loan,
                  and the balance
                  of $1.9 million ($2.3 million Canadian) is the net value of the
                  minority
                  partner’s contribution. On September 23, 2005, CRA agreed to the terms
                  of a
                  $17.2 million ($20.0 million Canadian) credit facility with Canadian
                  Western
                  Bank (“CWB”) for the development of the casino property (See Note 6 for
                  additional information). On December 17, 2004, the Alberta Gaming and
                  Liquor Commission granted approval to begin construction of the
                  casino property.
                  As is customary, the issuance of the license does not occur until
                  completion of
                  construction and after all federal and provincial legislation,
                  regulation and
                  policies, and municipal requirements, permits, licenses and/or
                  authorizations
                  have been met. CRI has entered into a long-term agreement to manage
                  the
                  facility.
  -F12-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 **Newcastle,
                  South Africa** - In
                  November 2005, CCA entered into an agreement for the purchase of
                  a 60%
                  controlling interest in Balele Leisure (Pty) Ltd.(“Balele”), which owns the
                  Monte Vista Casino in Newcastle, South Africa for 57.5 million
                  Rand
                  (approximately $8.6 million). The current casino is a temporary
                  facility that
                  has 200 slot machines and seven gaming tables. A new permanent
                  facility is
                  proposed to be constructed in 2006
                  for
                  approximately 61 million Rand ($9.6 million) excluding value added
                  taxes .
                  The
                  initial gaming mix in the permanent facility is expected to be
                  225 slot machines
                  and seven gaming tables. An additional 2.5 million Rand (approximately
                  $0.4
                  million) will be payable if the casino revenue during the first
                  twelve months of
                  operation in the new location exceeds 95.0 million Rand (approximately
                  $15.0
                  million). CCA has also entered into a long-term agreement to manage
                  Balele’s
                  entire casino, resort and hotel operations. The transaction is
                  expected to close
                  in the second quarter of 2006, subject to regulatory approvals.
  **Johannesburg** -
                    In
                    December 2004, CCI entered into agreements to sell a portion
                    of its interest in
                    a project in Gauteng, South Africa that we had previously been
                    pursuing jointly
                    with Silverstar Development Ltd. and granted options to Silverstar
                    and a group
                    led by Akani Leisure Investments, Ltd. to purchase our remaining
                    interests in
                    the Gauteng project. CCI received an initial payment of approximately
                    $1.7
                    million, or 10.0 million Rand, for the sale of 100% of the outstanding
                    common
                    stock of Verkrans Ontwikkelings Maatskappy (Pty) Ltd., a wholly
                    owned subsidiary
                    of CCA, whose only asset was land related to this project, and
                    for funds
                    previously advanced to Silverstar. Also in conjunction with the
                    agreements, we
                    loaned Silverstar $0.5 million (3.0 million Rand), of which the
                    entire amount
                    was fully reserved, repayable in six equal annual installments
                    with interest
                    commencing January 1, 2007. We have, therefore, recognized net
                    proceeds of $1.2
                    million, or 7.0 million Rand, in the transaction. The exercise
                    price of the
                    purchase option granted to Silverstar and the Akani group totals
                    approximately
                    $6.8 million, or 40.3 million Rand. Exercisability of the purchase
                    option is
                    contingent on regulatory and related approvals being secured
                    by Silverstar and
                    the Akani group. The outcome of these approvals is unknown at
                    this time.
  **Franklin
                  County, Iowa** -
                  On May
                  11, 2005, the Company announced that it was not awarded a license
                  by the Iowa
                  Gaming and Racing Commission to develop and operate the proposed
                  Landmark Casino
                  and Hotel project in Franklin County, Iowa. The Company wrote off
                  approximately
                  $0.2 million related to this project.
 
 **2.**
                        **SIGNIFICANT
                            ACCOUNTING POLICIES**
 
 ***Principles
                  of Consolidation*** -
                  The
                  accompanying consolidated financial statements include the accounts
                  of CCI and
                  its majority-owned subsidiaries. Investments in unconsolidated
                  affiliates that
                  are 20% to 50% owned, are accounted for under the equity method.
                  All
                  intercompany transactions and balances have been eliminated.
 
 Our
                  65%
                  ownership interest in CC Tollgate LLC is carried at our capital
                  account balance
                  based on provisions in the LLC agreement that require liquidation
                  to be
                  proportionate to each unitholder’s positive capital account which results in a
                  minority interest liability related to the project of $2.4 million
                  and $4.2
                  million as of December 31, 2005 and 2004, respectively. Future
                  profits and
                  losses will be allocated and recognized in such a manner as to
                  ultimately bring
                  each unitholder’s capital account into proportion of their respective
                  unitholdings.
  -F13-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 ***Use
                  of Estimates -*** **** The
                  preparation of financial statements in conformity with accounting
                  principles
                  generally accepted in the United States of America requires management
                  to make
                  estimates and assumptions that affect the reported amount of assets
                  and
                  liabilities and disclosure of contingent assets and liabilities
                  at the date of
                  the financial statements and the reported amounts of revenues and
                  expenses
                  during the reporting period. Actual results could differ from those
                  estimates.
 
 ***Cash
                  and Cash Equivalents*** - All
                  highly liquid investments with an original maturity of three months
                  or less are
                  considered to be cash equivalents. Minimum deposits that are required
                  in
                  connection with our listing on the Vienna Stock Exchange are designated
                  as
                  restricted cash on the 2005 consolidated balance sheet. Minimum
                  deposits that
                  were required in connection with the ABSA Bank loan (See Note 6
                  for additional
                  information) are designated as restricted cash on the 2004 consolidated
                  balance
                  sheet.
 
 ***Fair
                  Value of Financial Instruments*** ** -
                  We
                  calculate the fair value of financial instruments and include this
                  additional
                  information in the notes to our consolidated financial statements
                  when the fair
                  value does not approximate the carrying value of those financial
                  instruments.
                  Our financial instruments include cash and cash equivalents, long-term
                  debt and
                  interest rate swap agreements. Fair value is determined using quoted
                  market
                  prices whenever available. When quoted market prices are not available,
                  we use
                  alternative valuation techniques such as calculating the present
                  value of
                  estimated future cash flows utilizing risk-adjusted discount rates.
                  Our carrying
                  value of financial instruments approximates fair value at December
                  31, 2005 and
                  2004.
 
 ***Property
                  and Equipment*** -
                  Property and equipment are stated at cost. Depreciation of assets
                  in service is
                  provided using the straight-line method over the estimated useful
                  lives of the
                  assets. Leased property and equipment under capital leases is amortized
                  over the
                  lives of the respective leases or over the service lives of the
                  assets,
                  whichever is shorter. The interest cost associated with major development
                  and
                  construction projects is capitalized and included in the cost of
                  the project.
                  When no debt is incurred specifically for a project, interest is
                  capitalized on
                  amounts expended on the project using the weighted-average cost
                  of our
                  outstanding borrowings. Capitalization of interest ceases when
                  the project is
                  substantially complete or development activity is suspended for
                  more than a
                  brief period.
 
 Assets
                          are depreciated over their respective service lives as
                          follows:Buildings
                            and improvements
                        7
                            -
                            39 yrsGaming
                            equipment
                        3
                            -
                            7 yrsFurniture
                            and office equipment
                        5
                            -
                            7 yrsOther
                            equipment
                        3
                            -
                            7 yrs
  -F14-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 ***Goodwill
                  and Other Intangibles*** -
                  Goodwill represents the excess of the purchase price over the fair
                  value of the
                  net identifiable assets acquired in a business combination. SFAS
                  No. 142
“Goodwill and Other Intangible Assets” (see Note 5) addresses the methods used
                  to capitalize, amortize and to assess impairment of intangible
                  assets, including
                  goodwill resulting from business combinations accounted for under
                  the purchase
                  method. In evaluating the Company’s capitalized casino license costs, management
                  considered all of the criteria set forth in SFAS No. 142 for determining
                  useful
                  life. Of particular significance in this evaluation are the existing
                  regulatory
                  provisions relating to the renewal of licenses. In general, the
                  renewal of a
                  license can be done at minimal cost to the Company, as long as
                  the Company is in
                  compliance with all applicable laws. Based on our evaluation, the
                  Company deemed
                  that casino license costs have an indefinite life. We perform our
                  annual
                  impairment test for goodwill and indefinite-lived intangible assets
                  in the
                  fourth quarter of each fiscal year. No impairments were indicated
                  as a result of
                  the annual impairment reviews for goodwill and indefinite-lived
                  intangible
                  assets in 2005, 2004 or 2003.
 
 ***Impairment
                  of Long-Lived Assets*** -
                  We
                  review long-lived assets for possible impairment whenever events
                  or
                  circumstances indicate that the carrying amount of an asset may
                  not be
                  recoverable. If there is an indication of impairment, determined
                  by the excess
                  of the carrying value in relation to anticipated undiscounted future
                  cash flows,
                  the carrying amount of the asset is written down to its estimated
                  fair value by
                  a charge to operations. Fair value is estimated based on the present
                  value of
                  estimated future cash flows using a discount rate commensurate
                  with the risk
                  involved. Estimates of future cash flows are inherently subjective
                  and are based
                  on management’s best assessment of expected future conditions. No impairment
                  charges were recorded for the years ended December 31, 2005, 2004
                  and
                  2003.
 
 ***Revenue
                  Recognition*** - Casino
                  revenue is the net win from gaming activities, which is the difference
                  between
                  gaming wins and losses. Management and consulting fees are recognized
                  as revenue
                  as services are provided.  The
                  incremental amount of unpaid progressive jackpot is recorded as
                  a liability and
                  a reduction of casino revenue in the period during which the progressive
                  jackpot
                  increases.
 
 ***Promotional
                  Allowances*** - Food
                  and beverage furnished without charge to customers is included
                  in gross revenue
                  at a value which approximates retail and is then deducted as complimentary
                  services to arrive at net revenue.
 
 We
                  issue
                  free play or coupons for the purpose of generating future revenue.
                  Coupons are
                  issued the month prior to when they can be redeemed and are valid
                  for defined
                  periods of time ranging up to 7 days. The net win from the coupons
                  is expected
                  to exceed the value of the coupons issued. The cost of the coupons
                  redeemed is
                  applied against the revenue generated on the day of the redemption.
 
 Members
                  of the casinos’ players clubs earn points as a percentage of coin-in. The cost
                  of the points is offset against the revenue in the period that
                  the revenue
                  generated the points. The value of the unused or unredeemed points
                  is included
                  in the accounts payable and accrued liabilities on our consolidated
                  balance
                  sheets.
 
 ***Foreign
                  Currency Translation*** -
                  Adjustments resulting from the translation of the accounts of our
                  foreign
                  subsidiaries from the local functional currency to U.S. dollars
                  are recorded as
                  other comprehensive income or loss in the consolidated statements
                  of
                  shareholders’ equity and comprehensive income. Foreign currency transaction
                  gains or losses resulting from the translation of casino operations
                  and other
                  transactions that are denominated in a currency other than U.S.
                  dollars are
                  recognized in the statements of earnings. Gains and losses from
                  intercompany
                  foreign currency transactions that are of a long-term investment
                  nature and are
                  between entities of the consolidated group are not included in
                  determining net
                  earnings, but rather are reported as translation adjustments within
                  other
                  comprehensive income or loss in the consolidated statements of
                  shareholders’
equity and comprehensive income.
  -F15-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 Historical
                  transactions that are denominated in a foreign currency are translated
                  and
                  presented at the United States exchange rate in effect on the date
                  of the
                  transaction. Commitments that are denominated in a foreign currency
                  and all
                  balance sheet accounts other than shareholders’ equity are translated and
                  presented based on the exchange rate at the end of the reported
                  periods. Current
                  period transactions affecting the profit and loss of operations
                  conducted in
                  foreign currencies are valued at the average exchange rate for
                  the period in
                  which they are incurred. The exchange rates used to translate balances
                  at the
                  end of the reported periods are as follows:
 
 December
                            31, 2005
                        
                        December
                            31, 2004
                        
                        December
                            31, 2003South
                            African Rand
                        
                        
                        6.3399
                        
                        
                        5.6640
                        
                        
                        6.6858Euros
                        
                        
                        0.8446
                        
                        
                        0.7388
                        
                        
                        0.7938Czech
                            Koruna
                        
                        
                        24.5810
                        
                        
                        22.4640
                        
                        
                        25.6634Canadian
                            Dollars
                        
                        
                        1.1659
                        
                        
                        1.2036
                        
                        
                        1.2924
 Source:
                  Pacific Exchange Rate Service
 
 ***Income
                  Taxes*** - We
                  account for income taxes using the liability method, which provides
                  that
                  deferred tax assets and liabilities are recorded based on the difference
                  between
                  the tax bases of assets and liabilities and their carrying amounts
                  for financial
                  reporting purposes, at a rate expected to be in effect when the
                  differences
                  become deductible or payable.
 
 ***Stock-Based
                  Compensation*** - In
                  2002, we adopted Statement of Financial Accounting Standards No.
                  148 (SFAS 148),
“Accounting for Stock-Based Compensation - Transition and Disclosure” which
                  amends the disclosure requirements of Statement of Financial Accounting
                  Standards No. 123 (SFAS 123), “Accounting for Stock-Based Compensation” to
                  require prominent disclosure in both annual and interim financial
                  statements
                  about the method of accounting for stock-based employee compensation
                  and the
                  effect of the method used on reported results. SFAS 148 also provides
                  alternative methods of transition for a voluntary change to fair
                  value based
                  methods of accounting, which have not been adopted by us at this
                  time. SFAS 123
                  encourages, but does not require companies to record compensation
                  cost for
                  stock-based employee compensation plans at fair value. We have
                  chosen to account
                  for stock-based compensation for employees using the intrinsic
                  value method
                  prescribed in Accounting Principles Board Opinion No. 25 (APB 25),
“Accounting
                  for Stock Issued to Employees”, and related Interpretations. Accordingly,
                  compensation cost for stock options is measured as the excess,
                  if any, of the
                  quoted market price of our stock at the date of the grant over
                  the amount an
                  employee must pay to acquire that stock. We value stock-based compensation
                  granted to non-employees at fair value.
 
 Our
                  original stock-based employee compensation plan expired in April
                  2004 (see Note
                  8). The original plan continues to be administered for previously
                  issued and
                  outstanding options. Stockholders approved a new equity incentive
                  plan (the
“2005 Plan”) at the 2005 annual meeting on June 17, 2005. The 2005
                  Plan provides for the grant of awards to eligible employees in
                  the form of
                  stock, restricted stock, stock options, performance units or other
                  stock-based
                  awards, all as defined in the 2005 Plan. The 2005 Plan provides
                  for the issuance
                  of up to 2,000,000 shares of common stock to eligible employees
                  through the
                  various forms of awards permitted. The 2005 Plan limits the number
                  of options
                  that can be awarded to an employee to 200,000 per year. Stock options
                  may not be
                  issued at an option price lower than fair market value at the date
                  of grant. All
                  stock options must have an exercise period not to exceed ten years.
                  There are
                  1,986,210 outstanding options to employees as of December 31,
                  2005.
  -F16-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 All
                  options granted under the original plan and the 2005 Plan had an
                  exercise price
                  equal to the market value of the underlying common stock on the
                  date of the
                  grant. The following table illustrates the effect on net earnings
                  and earnings
                  per share if we had applied the fair value recognition provisions
                  of
                  SFAS No.123, “Accounting for Stock-Based Compensation”, to stock-based
                  employee compensation:
 
 
 *Amounts
                            shown in thousands, except share data*
                        
                        **2005**
                        
                        **2004**
                        
                        **2003**Net
                            earnings, as reported
                        
                        $
                        4,481
                        
                        $
                        4,738
                        
                        $
                        3,246Deduct:
                            Total stock-based employee compensation expense determined
                            under fair
                            value based method for all awards, net of related tax
                            effects
                        
                        
                        515
                        
                        
                        1,114
                        
                        
                        4Pro
                            forma net earnings
                        
                        $
                        3,966
                        
                        $
                        3,624
                        
                        $
                        3,242Earnings
                            per shareBasicAs
                            reported
                        
                        $
                        0.28
                        
                        $
                        0.35
                        
                        $
                        0.24Pro
                            forma
                        
                        $
                        0.25
                        
                        $
                        0.27
                        
                        $
                        0.24DilutedAs
                            reported
                        
                        $
                        0.25
                        
                        $
                        0.30
                        
                        $
                        0.22Pro
                            forma
                        
                        $
                        0.22
                        
                        $
                        0.23
                        
                        $
                        0.22
 
 The
                  fair
                  value of options granted under the Company’s stock based compensation plans were
                  estimated on the date of grant using the Black-Scholes option pricing
                  model with
                  the following assumptions:
 
 **2005**
                        
                        **2004**
                        
                        **2003**Weighted-average
                            risk-free interest rate
                        
                        4.50%
                        
                        4.00%
                        
                        -Weighted-average
                            expected life
                        
                        10.0
                            yrs
                        
                        9.5
                            yrs
                        
                        -Weighted-average
                            expected volatility
                        
                        46.3%
                        
                        55.1%
                        
                        -Weighted-average
                            expected dividends
                        
                        $
                            0
                        
                        $
                            0
                        
                        -
 
 The
                  weighted-average fair value of options granted was $4.88 in 2005
                  and $1.97 in
                  2004. A total of 35,000 and 1,352,710 were granted in 2005 and
                  2004,
                  respectively. No options were granted to employees under the stock
                  based
                  compensation plan in 2003.
 
 Additionally,
                  60,000 options were issued to independent directors in 2004.
 
 ***Earnings
                  Per Share*** -
                  Basic
                  earnings per share considers only weighted-average outstanding
                  common shares in
                  the computation. Diluted earnings per share give effect to all
                  potentially
                  dilutive securities. Diluted earnings per share is based upon the
                  weighted
                  average number of common shares outstanding during the period,
                  plus, if
                  dilutive, the assumed exercise of stock options using the treasury
                  stock method
                  and the assumed conversion of other convertible securities (using
                  the “if
                  converted” method) at the beginning of the year, or for the period outstanding
                  during the year for current year issuances.
  -F17-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 ***Comprehensive
                  Income*** -
                  Comprehensive income for us includes the effect of fluctuations
                  in foreign
                  currency rates on value of our foreign investments and the interest
                  rate swap
                  agreements we maintain to hedge against increases in the interest
                  rate on our
                  credit facilities.
 
 ***Operating
                  Segments*** - We are
                  managed in six segments: Cripple Creek, Colorado; Central City,
                  Colorado;
                  Edmonton, Canada; South Africa; Cruise Ships; and Corporate and
                  Other
                  operations. The operating results of the Cripple Creek, Colorado
                  segment are
                  those of WMCK and subsidiaries which own Womacks Casino and Hotel
                  (“Womacks”) in
                  Cripple Creek, Colorado. The operating results of the Central City,
                  Colorado
                  segment are those of CTI and subsidiary, which are developing a
                  proposed casino
                  and hotel. The operating results of the Edmonton, Canada segment
                  are those of
                  CRA, which is developing a proposed casino and hotel. The operating
                  results of
                  the South African segment are those of CCA and its subsidiaries,
                  primarily CCAL,
                  which owns the Caledon Hotel, Spa and Casino. The cruise ship segment
                  includes
                  the revenues and expenses of the shipboard operations for which
                  the Company has
                  casino concessions agreements. Corporate and Other operations include,
                  among
                  other items, the revenue and expense of corporate gaming projects
                  for which we
                  have secured long-term service contracts.
 
 ***Hedging
                  Activities*** -
                  Companies are required to recognize all of their derivative instruments
                  as
                  either assets or liabilities in the balance sheet at fair value.
                  The accounting
                  for changes in the fair value (i.e. gains or losses) of a derivative
                  instrument
                  depends on whether it has been designated and qualifies as part
                  of a hedging
                  relationship and further, on the type of hedging relationship.
                  For those
                  derivative instruments that are designated and qualify as hedging
                  instruments, a
                  company must designate the hedging instrument, based upon the exposure
                  being
                  hedged, as either a fair value hedge, cash flow hedge or a hedge
                  of a net
                  investment in a foreign operation.
 
 For
                  derivative instruments that are designated and qualify as a cash
                  flow hedge
                  (i.e. hedging the exposure to variability in expected future cash
                  flows that is
                  attributable to a particular risk), the effective portion of the
                  gain or loss on
                  the derivative instrument is reported as a component of other comprehensive
                  income and reclassified into earnings in the same period or periods
                  during which
                  the hedged transaction affects earnings. The remaining gain or
                  loss on the
                  derivative instrument in excess of the cumulative change in the
                  present value of
                  future cash flows of the hedged item, if any, is recognized in
                  current earnings
                  during the period of change. For derivative instruments not designated
                  as
                  hedging instruments, the gain or loss is recognized in current
                  earnings during
                  the period of change. We currently do not have fair value hedges
                  or hedges of a
                  net investment in a foreign operation.
 
 The
                  Company has no outstanding interest rate swap agreements as of
                  December 31,
                  2005. At December 31, 2004, our interest rate swap agreements decreased
                  shareholders’ equity (accumulated other comprehensive income) by less than $0.1
                  million, net of federal and state income tax benefits.
 
 ***Advertising
                  Costs*** - Costs
                  incurred for producing and communicating advertising are expensed
                  when incurred.
                  Advertising expense was $0.7 million, $0.8 million and $0.6 million
                  for the
                  years ended December 31, 2005, 2004 and 2003, respectively.
 
 ***Preopening
                  Expenses*** -
                  Preopening, pre-operating and organization activities are expensed
                  as
                  incurred.
  -F18-
 *Index*
  **CENTURY
                  CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 
 
 ***Reclassifications*** ** -
                  Certain
                  reclassifications have been made to the 2004 and 2003 financial
                  information in
                  order to conform to the 2005 presentation.
 
 ***Recent
                  Accounting Pronouncements*** **-** In
                  May
                  2005, the Financial Accounting Standards Board (“FASB”) issued Statement of
                  Financial Accounting Standards No. 154 (SFAS 154), “Accounting Changes and Error
                  Corrections,” which replaces APB Opinion No. 20, “Accounting Changes,” and FASB
                  Statement No. 3, “Reporting Accounting Changes in Interim Financial
                  Statements.” APB Opinion No. 20 had required that changes in accounting
                  principles be recognized by including the cumulative effect of
                  the change in the
                  period in which the new accounting principle was adopted. SFAS
                  154 requires
                  retrospective application of the change to prior periods’ financial statements,
                  unless it is impracticable to determine the period-specific effects
                  of the
                  change. The statement is effective for fiscal years beginning after
                  December 15,
                  2005. We do not expect the adoption of SFAS 154 to have a material
                  impact on our
                  financial position, results of operations or cash flows.
 
 In
                  December 2004, the FASB issued SFAS No. 153 (SFAS 153), “Exchanges of
                  Nonmonetary Assets - an amendment of APB Opinion No. 29.” This eliminates the
                  exception in APB Opinion No. 29 for nonmonetary exchanges of similar
                  productive
                  assets and replaces it with a general exception for exchanges of
                  nonmonetary
                  assets that do not have commercial substance. A nonmonetary exchange
                  has
                  commercial substance if the future cash flows of the entity are
                  expected to
                  change significantly as a result of the exchange. The provisions
                  of this
                  statement is effective for fiscal periods beginning after June
                  15, 2005. The
                  adoption of SFAS 153 did not have a material impact on our financial
                  position,
                  results of operations or cash flows.
 
 In
                  December 2004, the FASB issued SFAS No. 123R (SFAS 123R), “Share-Based Payment.”
SFAS 123R requires employee stock options and rights to purchase
                  shares under
                  stock participation plans to be accounted for under the fair value
                  method, and
                  eliminates the ability to account for these instruments under the
                  intrinsic
                  value method prescribed by Accounting Principles Board Opinion
                  No. 25,
“Accounting for Stock Issued to Employees.” In addition, SFAS 123R requires that
                  the cost resulting from all share-based payments be recognized
                  as an expense in
                  the consolidated financial statements, and also changes the classification
                  of
                  certain tax benefits in the consolidated statement of cash flows.
                  Beginning on
                  January 1, 2006, the Company will record compensation expense for
                  unvested stock
                  option awards over the future periods in which the awards vest.
                  Based on
                  unvested stock options outstanding at December 31, 2005, pre-tax
                  compensation
                  expense related to stock option awards will be approximately $0.4
                  million in
                  2006, which equates to a decrease in EPS of $0.02 in 2006. However,
                  the total
                  expense recorded in future periods, including fiscal 2006, will
                  depend on
                  several variables, including the number of stock-based awards that
                  are granted
                  in future periods and the fair value of those awards. The Company
                  is planning to
                  use the “modified prospective transition” method, which does not require the
                  restatement of previous periods’ results.
 
 **3.**
                        **EQUITY
                            INVESTMENT IN UNCONSOLIDATED
                            SUBSIDIARY**
  We
                  have a
                  50% ownership in Casino Millennium (“CM”) and we account for this investment
                  under the equity method.
  -F19-
 *Index*
 **CENTURY
                    CASINOS, INC. AND SUBSIDIARIES**
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 Following
                  is the unaudited summarized financial information of CM as of and
                  for the years
                  ended December 31, 2005 and 2004:
 
 **Casino
                            Millennium (1)**
                        
                        **2005**
                        
                        **2004***Amounts
                            shown in thousands***Balance
                            Sheet:**Current
                            Assets
                        
                        $
                        1,391
                        
                        $
                        841Noncurrent
                            Assets
                        
                        $
                        869
                        
                        $
                        935Current
                            Liabilities
                        
                        $
                        568
                        
                        $
                        104Noncurrent
                            liabilities
                        
                        $
                        1,476
                        
                        $
                        1,191**Operating
                            Results:**Net
                            operating revenue
                        
                        $
                        2,084
                        
                        $
                        2,489Net
                            (loss) earnings (2)(3)
                        
                        $
                        (405
                        )
                        $
                        95
 
 (1)
                        Prior
                            to 2004, we accounted for our 10% investment in Casino
                            Millennium on the
                            cost method.
 (2)
                        After
                            expensing $0.1 million of casino services fees paid to
                            the Company in 2005
                            and 2004.
 (3)
                        Under
                            the equity method of accounting, when an investor’s net investment is
                            reduced to zero, the investor should not provide for
                            additional losses
                            unless the investor has guaranteed the obligations of
                            the investee. The
                            Company has not provided this guarantee to Casino Millennium.
                            Accordingly,
                            the Company has only recorded its portion of the loss
                            that reduced its net
                            investment to zero.
  FIN
                  46(R), “Consolidation of Variable Interest Entities”, addresses consolidation
                  issues by business enterprises of variable interest entities in
                  which 1) the
                  equity interest at risk is not sufficient to finance its activities
                  without
                  additional subordinated financial support, 2) the equity investors
                  lack one or
                  more essential characteristics of a controlling financial interest
                  or 3) the
                  equity investors have voting rights that are not proportionate
                  to their economic
                  interest. We adopted FIN 46(R) on January 1, 2004. We determined
                  that CM is a
                  variable interest entity as defined by FIN 46(R). We also determined
                  that we are
                  not the primary beneficiary as defined by FIN 46(R) and have, therefore,
                  accounted for our 50% interest in CM on the equity basis. A primary
                  beneficiary
                  is the party that absorbs a majority of the entity’s expected losses, receives a
                  majority of its expected returns, or both as defined in FIN 46(R).
                  Under the
                  equity method of accounting, we have recognized the difference
                  between the
                  investment and the underlying cost of the equity as goodwill and
                  reported our
                  percentage of the earnings in CM as equity in (loss) earnings from
                  unconsolidated subsidiary.
  The
                  Company’s estimated maximum exposure to losses at December 31, 2005 consists
                  of
                  the following ( *Amounts
                  in thousands* ):
 
 Goodwill
                        
                        $
                        528Note
                            receivable
                        
                        
                        242Other
                            receivables
                        
                        
                        200Total
                        
                        $
                        970
  -F20-
 *Index*


**CENTURY
        CASINOS, INC. AND SUBSIDIARIES**
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 
 
 **4.**
              **PROPERTY
                  AND EQUIPMENT**
 
 Property
        and equipment at December 31, 2005 and 2004 consist of the
        following:
 
 *Amounts
                  shown in thousands*
              
              **2005**
              
              **2004**Buildings
                  and improvements
              
              $
              28,828
              
              $
              29,311Gaming
                  equipment
              
              
              13,976
              
              
              12,725Furniture
                  and office equipment
              
              
              5,075
              
              
              4,992Other
                  equipment
              
              
              2,553
              
              
              2,23850,432
              
              
              49,266Less
                  accumulated depreciation
              
              
              (21,869
              )
              
              (19,611
              )28,563
              
              
              29,655Land
              
              
              22,432
              
              
              18,498Capital
                  projects in process
              
              
              18,218
              
              
              55Non-operating
                  casino and land
              
              
              389
              
              
              421Property
                  and equipment, net
              
              $
              69,602
              
              $
              48,629
 
 Depreciation
        expense for the years ended December 31, 2005, 2004 and 2003 was $3.3 million,
        $3.0 million and $2.7 million, respectively.
 
 We
        capitalized $0.6 million, $0 and less than $0.1 million of interest towards
        our
        various construction projects during 2005, 2004 and 2003,
        respectively.
 
 ***Non-operating
        casino and land*** - We are
        currently holding non-operating casino property and land for sale in Wells,
        Nevada. The property and land was acquired in 1994 from an unaffiliated party
        at
        a cost of $0.9 million. The carrying value of the property and land as of
        December 31, 2005 and 2004 is based on the appraised value of the land less
        the
        estimated cost to sell.
 
 **5.**
              **GOODWILL
                  AND OTHER INTANGIBLE
                  ASSETS**
 
 Changes
        in the carrying amount of goodwill for the years ended December 31, 2005
        and
        2004 are as follows by segment:
 
 *Amounts
                  shown in thousands*
              
              Cripple
                  Creek, CO
              
              South
                  Africa
              
              Corp
                  & Other
              
              Total**Balance
                  as of January 1, 2004**
              
              **$**
              **7,232**
              ****
              **$**
              **856**
              ****
              **$**
              -
              ****
              **$**
              **8,088**Goodwill
                  recorded in equity investment in Casino Millennium
              
              
              -
              
              
              -
              
              
              565
              
              
              565Effect
                  of foreign currency translation
              
              
              -
              
              
              153
              
              
              39
              
              
              192**Balance
                  as of December 31, 2004**
              
              
              **7,232**
              
              
              **1,009**
              
              
              **604**
              
              
              **8,845**Effect
                  of foreign currency translation
              
              
              -
              
              
              (107
              )
              
              (76
              )
              
              (183
              )**Balance
                  as of December 31, 2005**
              
              **$**
              **7,232**
              ****
              **$**
              **902**
              ****
              **$**
              **528**
              ****
              **$**
              **8,662**
  -F21-
 *Index*
  **CENTURY
        CASINOS, INC. AND SUBSIDIARIES**
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 
 
 Intangible
        assets, not subject to amortization, include casino licenses as follows as
        of
        December 31:
 
 *Amounts
                  shown in thousands*
              
              **2005**
              
              **2004**Century
                  Casinos Caledon (Pty) Ltd. - South Africa (1)
              
              $
              1,820
              
              $
              2,036Edmonton,
                  Canada
              
              
              12
              
              
              12Central
                  City, Colorado
              
              
              13
              
              
              13**Total
                  casino licenses**
              
              **$**
              **1,845**
              ****
              **$**
              **2,061**
  (1)
              Includes
                  impact of foreign currency translation of approximately $0.2 million
                  in
                  2005.
 
 **6.**
              **LONG-TERM
                  DEBT**
 
 Long-term
        debt at December 31, 2005 and 2004 consists of the following:
 
 *Amounts
        shown in thousands:*
 **2005**
              
              **2004**Revolving
                  Credit Facility - Womacks
              
              $
              481
              
              $
              15,656Construction
                  Term Loan - Central City
              
              
              8,931
              
              
              -Nedbank
                  Limited Term Loan
              
              
              9,091
              
              
              -ABSA
                  Bank Term Loan
              
              
              -
              
              
              3,493Notes
                  payable to minority interest holder
              
              
              1,135
              
              
              1,121Capital
                  leases and other
              
              
              85
              
              
              234Total
                  long-term debt
              
              
              19,723
              
              
              20,504Less
                  current portion
              
              
              (1,789
              )
              
              (2,534
              )Long-term
                  portion
              
              $
              17,934
              
              $
              17,970




-F22-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS







*Revolving
      Credit Facility - Womacks*





On
      April 21, 2000, the Company and Wells Fargo Bank (the “Bank”) entered into an
      Amended and Restated Credit Agreement (the “Agreement”) which increased our
      aggregate borrowing commitment from the Bank under a Revolving Line of Credit
      Facility (“Womacks RCF”) to $26 million and extended the maturity date to April
      2004. The Agreement was further amended on August 22, 2001 to give greater
      flexibility to the ability to use the borrowed funds for projects for the
      Company. On August 28, 2002, the Womacks RCF was further amended to increase
      the
      facility to its original amount of $26 million, an increase of $5.8 million,
      revise the quarterly reduction schedule and extend the maturity date to August
      2007.  On
      October 27, 2004, the Womacks RCF was further amended to modify the aggregate
      commitment reduction schedule. The aggregate commitment available to the Company
      is reduced by $0.3 million for two quarters beginning July 1, 2005, by $0.6
      million for two quarters beginning January 1, 2006 and finally by $0.7 million
      at the beginning of each quarter beginning July 1, 2006 through the maturity
      date. The Womacks RCF was further amended on September 23, 2005 to enable the
      Company to guarantee the debt of its subsidiaries and enter into a management
      agreement with WMCK, subject to certain limitations. On December 6, 2005, a
      fifth amendment was entered into permitting the Company to make capital
      contributions to Womacks for a specified period that can be used to repay the
      outstanding obligations under the Womacks RCF, and subsequently permits Womacks
      to make cash distributions to the Company up to the amount of the Company’s
      capital contributions ($14.5 million as of December 31, 2005) made during the
      specified period. The commitment available as of December 31, 2005, net of
      quarterly reductions, is $20.3 million and unused borrowing capacity is $19.8
      million. Interest on the Agreement is variable based on the interest rate option
      selected by the Company, plus an applicable margin based on the Company’s
      leverage ratio. The Agreement also requires a nonusage fee based on the
      Company’s leverage ratio on the unused portion of the commitment. The principal
      balance outstanding under the loan agreement as of December 31, 2005 and 2004
      was $0.5 million and $15.7 million, respectively. The amended loan agreement
      includes certain restrictive covenants on financial ratios of WMCK. The most
      significant covenants include i) a maximum leverage ratio no greater than 2.75
      to 1.00 as of the quarter ending December 31, 2005 (decreasing as scheduled
      to
      2.00 to 1.00 as of the quarter ending June 30, 2007 until the Womacks RCF
      terminates), ii) a minimum interest coverage ratio no less than 2.00 to 1.00,
      and iii) a TFCC ratio (a derivative of EBITDA, as defined in the amended
      agreement) of no less than 1.10 to 1.00. The Company is in compliance with
      the
      restrictive covenants on the financial ratios of WMCK contained in the Womacks
      RCF as of December 31, 2005. The loan is collateralized by a deed of trust
      and a
      security agreement with assignments of lease, rents and furniture, fixtures
      and
      equipment of Womacks property. The interest rate at December 31, 2005 was 7.5%
      for the balance of the loan outstanding under the prime based provisions of
      the
      loan agreement.





In
      1998,
      we entered into a five-year interest rate swap agreement on $7.5 million
      notional amount of debt under the Womacks RCF, whereby we paid a LIBOR-based
      fixed rate of 5.55% and received a LIBOR-based floating rate reset quarterly
      based on a three-month rate. The swap agreement expired October 1, 2003. In
      May
      2000, we entered into a second five-year interest rate swap agreement on $4.0
      million notional amount of debt under the Womacks RCF, whereby we paid a
      LIBOR-based fixed rate of 7.95% and received a LIBOR-based floating rate reset
      quarterly based on a three-month rate. This swap agreement expired on July
      1,
      2005. The fair value of the derivatives as of December 31, 2004 of $0.1 million
      is reported as a current liability in the consolidated balance sheet. Our
      objective for entering into the interest rate swap agreements, derivative
      instruments designated as cash flow hedging instruments, was to eliminate the
      variability of cash flows in the interest payments for a portion of the Womacks
      RCF. We have determined that the cash flow hedges were highly effective.
      Accordingly no net gain or loss has been recognized in earnings during 2005,
      2004 or 2003 for hedge ineffectiveness. The effective portion on the interest
      rate swaps of $0.2 million, $0.4 million and $0.8 million, net of income tax
      expense of less than $0.1 million, $0.1 million and $0.2 million has been
      reported in comprehensive income on the statement of shareholders’ equity and
      comprehensive income for 2005, 2004 and 2003, respectively. Net additional
      interest expense to us under the swap agreement was $0.1 million, $0.3 million
      and $0.5 million in 2005, 2004 and 2003, respectively. Including the impact
      of
      the swaps and the amortization of the deferred financing cost, the effective
      rate on the borrowings under the Womacks RCF was 7.3%, 6.7% and 8.7% for 2005,
      2004 and 2003, respectively. We have not entered into any new swap agreements
      as
      of December 31, 2005.


-F23-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








*Loan
      Facility - Central City*





On
      November 21, 2005, CTL entered into a $35 million loan agreement with Wells
      Fargo Bank and a syndicate of institutional lenders. The loan agreement consists
      of a $32.5 million construction loan and a $2.5 million revolving line of credit
      (“CC Revolver”). The $32.5 million construction loan will convert to a 60-month
      term loan on the earlier of the 12 month anniversary of the closing of the
      loan
      or at such time as the Central City casino has been opened to the public. The
      $32.5 million construction loan and the CC Revolver will both mature on the
      fifth anniversary of conversion of the construction loan. The amount outstanding
      under the term loan is subject to quarterly reductions, beginning at $0.6
      million for the first full quarter following the conversion date of the loan,
      increasing to $1.1 million on the 17 th full
      quarter from the conversion date of the loan, until maturity. Availability
      under
      the line of credit will be conditional upon CTL being in compliance with all
      of
      the financial and other covenants contained in the loan agreement at the time
      of
      a particular drawdown, and the Company’s continued ability to make certain
      representations and warranties, including representations as to the absence
      of
      liens on the Central City properties other than certain permitted liens, the
      absence of litigation or other developments that have or could reasonably be
      expected to have a material adverse effect on the Company and its subsidiaries,
      and continued effectiveness of the documents granting security for the credit
      facility. The interest rate on both loans will be the greater of 8.5% or the
      Prime Rate plus 4.0% (11.25% as of December 31, 2005) and a service fee of
      0.5%
      on the total outstanding balance, payable monthly. Upon closing, CTL incurred
      a
      facility fee of $1.1 million payable to Wells Fargo Bank which was satisfied
      from the proceeds of the loan, which is being amortized through the maturity
      of
      the term loan. The loan agreement is subject to a prepayment fee, 19.6% during
      the construction period through the conversion date of the loan, which decreases
      annually to 4.1% in the 17 th full
      quarter after the conversion date of the loan through maturity; a nonusage
      fee
      of 0.75% on the unused portion of the total commitment; various reporting
      requirements and various financial covenants, the most significant being Total
      Leverage and Senior Leverage Ratios, Adjusted Fixed Charge Coverage and Minimum
      Annualized EBITDAM (earnings before interest, taxes, depreciation, amortization
      and management fees). The loan agreement is secured by all of CTL’s assets. The
      Company is required to enter into an interest rate hedge for at least 75% of
      the
      outstanding amount of the loan on the conversion date, ending on the maturity
      date of the loan. As of December 31, 2005, the principal balance outstanding
      under the loan agreement is $8.9 million and is considered long-term in the
      accompanying December 31, 2005 consolidated balance sheet.





The
      Company has a non-interest bearing stand-by letter of credit agreement for
      $0.8
      million with Wells Fargo Bank. The letter of credit is secured by the $35
      million loan facility with Wells Fargo Bank and expires on May 14, 2006. The
      letter of credit is a guarantee to the City of Central, Colorado for the
      Company’s completion of certain requirements relating to the construction of the
      casino. As of December 31, 2005, there was no balance outstanding under this
      letter of credit.





*Nedbank
      Limited Term Loan*





On
      August
      26, 2005, CCAL received a 60.0 million Rand, approximately $9.4 million, term
      loan from Nedbank Limited (“Nedbank”). In connection with the loan, CCAL and
      Nedbank entered into a loan agreement specifying the terms of the loan. Pursuant
      to the loan agreement, monthly principal and interest installment payments
      of
      1.3 million Rand ($0.2 million) are due on the first day of each month. The
      loan
      matures on January 9, 2010, at which time any outstanding principal and interest
      will be due. The term loan bears interest at South Africa’s prime interest rate,
      10.5% as of December 31, 2005, minus 1.5% and is secured by 10.0 million Rand
      ($1.6 million) of CCAL’s assets and 100% of the issued share capital of CCAL.
      CCAL has the option to prepay the loan, without penalty, upon 90 days written
      notice. As of December 31, 2005, $9.1 million of principal is outstanding,
      of
      which $7.5 million is considered long-term in the accompanying December 31,
      2005
      consolidated balance sheet.





*ABSA
      Bank Term Loan*





In
      the
      third quarter of 2005, CCAL paid 13.7 million Rand, or $2.1 million, obtained
      from the Nedbank financing, to retire the existing ABSA Bank loan. The
      retirement of this loan resulted in a non-operating charge of 1.2 million Rand,
      or $0.2 million, related to early termination penalties.


-F24-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








*Canadian
      Western Bank*





On
      September 23, 2005, CRA agreed to the terms of a $20.0 million Canadian
      (approximately $17.2 million) credit facility with Canadian Western Bank (“CWB”)
      for the development of a casino and hotel in Edmonton, Alberta, Canada. The
      credit facility is subject to certain closing conditions, one of which includes
      a total equity requirement of $14.9 million Canadian (approximately $12.8
      million). The credit facility is initially structured as a construction loan
      maturing on the earlier of 18 months from the initial construction draw or
      the
      receipt of a certified architectural completion certificate, certificate of
      occupancy and casino license. Upon maturity of the construction loan, CWB will
      issue a term loan to CRA, maturing within one to five years at CRA’s election.
      Proceeds from the term loan will be used to pay the outstanding balance of
      the
      construction loan. The construction loan bears interest at 1.25% per annum
      above
      CWB’s Prime Lending Rate (5.0% as of December 31, 2005), payable on the first
      day of each month. No principal payments are required on the construction loan.
      The interest rate on the term loan will be based on the maturity date selected
      by CRA. As of December 31, 2005, interest rates ranged from 6.55% to 6.80%,
      depending on the length of maturity selected. Monthly principal and interest
      payments on the term loan are based on a 10-year amortization, payable on the
      first day of each month. The loan facility is secured by the assets of CRA
      and
      guaranteed by the Company. CRA has the option to prepay the construction loan
      without penalty. CRA may elect to prepay up to 10% of the original principal
      amount of the term loan annually without penalty or bonus; prepayment of any
      additional amounts is subject to three months interest at the fixed interest
      rate. The participation requirements totaling 14.9 million Canadian, including
      equity, shareholder loans and working capital, must be fulfilled prior to the
      first construction draw. As of December 31, 2005, an additional $6.3 million
      Canadian ($5.4 million) must be provided before we can draw on the construction
      loan. The Company expects this requirement to be met from funds currently on
      hand.





The
      Company has two non-interest bearing stand-by letter of credit agreements
      totaling $0.1 million with Canadian Western Bank. These letters of credit have
      no maturity date and are cancelable upon written notice by CRA. CRA will incur
      a
      1% charge for each year the letters of credit are outstanding. These letters
      of
      credit guarantee to the City of Edmonton, Alberta, Canada the completion of
      certain requirements relating to the construction of the casino. As of December
      31, 2005, there were no balances outstanding under these letters of
      credit.





*Note
      payable - Tollgate*





Unsecured
      notes payable, in the amount of $1.1 million, as of December 31, 2005, to a
      minority interest holder in Tollgate, were payable contingent upon the opening
      of the Central City casino. The first note for $1.0 million is payable in two
      equal installments; the first payment is payable one year from the opening
      date
      of the casino, with the remaining amount due six months later. The note bears
      interest at an 8% rate and is classified as long-term in the accompanying
      consolidated balance sheet. In March 2005, the Company issued a second unsecured
      note payable in the amount of $0.1 million to a minority interest shareholder,
      payable on the opening date of the casino, thus considered as a current
      liability on the December 31, 2005 consolidated balance sheet.





The
      consolidated weighted average interest rate on all borrowings for Century
      Casinos, Inc. and subsidiaries was 7.0%, 9.1% and 10.4% for the years ended
      December 31, 2005, 2004 and 2003, respectively, excluding the amortization
      of
      deferred financing charges.


-F25-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








As
      of
      December 31, 2005, scheduled maturities of all long-term debt are as follows:





*(Amounts
                shown in thousands)*
            
            Future
                minimumlease
                paymentof
                capital leases
            
            Other
                debt2006
                -
            
            $
            68
            
            $
            1,7412007
                -
            
            
            23
            
            
            4,6572008
                -
            
            
            23
            
            
            5,8032009
                -
            
            
            23
            
            
            5,5022010
                -
            
            
            17
            
            
            1,935Thereafter
            
            
            -
            
            
            -154
            
            
            19,638Less
                amounts representing interest
            
            
            69
            
            
            -Total
            
            $
            85
            
            $
            19,638
            
            
            TotalCurrent
            
            $
            48
            
            $
            1,741
            
            $
            1,789Long-Term
            
            $
            37
            
            $
            17,897
            
            $
            17,934





**7.**
            **ACCOUNTS
                PAYABLE AND ACCRUED
                LIABILITIES**





Accounts
      payable and accrued liabilities are composed of the following at December 31,
      2005 and 2004:





*Amounts
                shown in thousands***2005**
            
            **2004**Accounts
                payable
            
            $
            1,310
            
            $
            981Accrued
                points liability
            
            
            241
            
            
            432Accrued
                construction expenditures
            
            
            1,962
            
            
            -Other
                accrued liabilities
            
            
            1,991
            
            
            2,135**Total**
            
            **$**
            **5,504**
            ****
            **$**
            **3,548**





**8.**
            **SHAREHOLDERS’
                EQUITY**





In
      July
      2005, the Company filed a shelf registration statement with the SEC, under
      which
      we could issue up to $50 million in aggregate issue price of common stock,
      preferred stock, debt securities and depository certificates. In October 2005,
      under this shelf registration, we issued 7,132,667 shares of common stock,
      in
      the form of Austrian Depository Certificates (“ADCs”), through our underwriter,
      to retail and institutional investors in the Republic of Austria and to
      institutional investors in Europe outside of the Republic of Austria. Each
      ADC,
      which is traded on the Vienna Stock Exchange, is equivalent to one share of
      our
      common stock. Each holder of an ADC is entitled to all the rights and
      preferences of, and subject to all of the limitations of, the underlying share
      of common stock represented by the ADC (including dividend, voting, redemption
      and liquidation rights and preferences). The number of ADCs and rights of the
      ADC holders associated with the ADCs held by such persons are evidenced in
      a
      modifiable global certificate which is issued and held in safe custody by the
      Oesterreichische Kontrollbank Aktiengesellschaft. The ADCs are subject to the
      laws of the Republic of Austria. The shares of our common stock represented
      by
      the ADCs are issued under the Delaware General Corporation Law. Therefore,
      the
      corporate legal matters related to our shares of common stock underlying the
      ADCs are governed by Delaware law. Net proceeds from this issuance were
      approximately $46.2 million.


-F26-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








In
      August
      2005, the Company issued 950,000 new shares of its common stock, at an exercise
      price of $1.50 per share, for stock options exercised in cash.





The
      Company’s Board of Directors approved a discretionary program to repurchase up
      to $5.0 million of the Company’s outstanding common stock. Through December 31,
      2005, the Company repurchased 2,559,004 shares of its common stock at an average
      cost per share of $1.49, of which 1,385,000 shares, with an average cost of
      $1.06 per share, were retired in 2000. The
      Company did not purchase any shares of it’s outstanding common stock on the open
      market in 2005.





There
      were 187,876 shares remaining in treasury as of December 31, 2005, at an average
      cost per share of $2.26. We
      re-issued 603,000 shares of treasury stock in 2005 for stock options exercised
      in cash, 40,000 of which were to satisfy directors’ options. In
      2004, a total of 14,400 shares were re-issued to satisfy option exercises,
      10,000 shares of which were to satisfy a director’s options.





The
      Board
      of Directors of the Company adopted an Employees’ Equity Incentive Plan (the
“EEIP”) in April 1994, which expired in April 2004. The EEIP continues to be
      administered for previously issued and outstanding options. Stockholders
      approved a new equity incentive plan (the “2005 Plan”) at the 2005 annual
      meeting. The 2005 Plan provides for the grant of awards to eligible individuals
      in the form of stock, restricted stock, stock options, performance units or
      other stock-based awards, all as defined in the 2005 Plan. The 2005 Plan
      provides for the issuance of up to 2,000,000 shares of common stock to eligible
      individuals through the various forms of awards permitted. The 2005 Plan limits
      the number of options that can be awarded to an eligible individual to 200,000
      per year. Stock options may not be issued at an option price lower than fair
      market value at the date of grant. All stock options must have an exercise
      period not to exceed ten years. Through December 31, 2005, only incentive stock
      option awards, for which the option price may not be less than fair market
      value
      at the date of grant, or non-statutory options, which may be granted at any
      option price (as permitted under the EEIP), have been granted under the EEIP
      and
      2005 Plan. Options granted to date have one-year, two-year or four-year vesting
      periods. The Company’s Incentive Plan Committee has the power and discretion to,
      among other things, prescribe the terms and conditions for the exercise of,
      or
      modification of, any outstanding awards in the event of merger, acquisition
      or
      any other form of acquisition other than a reorganization of the Company under
      United States Bankruptcy Code or liquidation of the Company. Both plans also
      allow limited transferability of any non-statutory stock options to legal
      entities that are 100% - owned or controlled by the optionee or to the
      optionee’s family trust. As of December 31, 2005 there were 1,986,210 options
      outstanding, of which 1,951,210 options were issued under the EEIP and 35,000
      options have been issued under the 2005 Plan.





As
      of
      December 31, 2005 there were an additional 80,000 options outstanding to
      directors of the Company of which 60,000 were issued in January 2004. The
      outstanding options to directors have a weighted average exercise price of
      $2.98.


-F27-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








Transactions
      regarding the Company’s stock based compensation plans are as
      follows:





**2005**
            
            **2004**
            
            **2003**Shares
            
            Weighted-AverageExercisePrice
            
            Shares
            
            Weighted-AverageExercisePrice
            
            Shares
            
            Weighted-AverageExercisePriceEmployee
                Stock Options:Outstanding
                at January 1,
            
            
            3,464,210
            
            $
            1.92
            
            
            2,160,300
            
            $
            1.29
            
            
            2,790,700
            
            $
            1.30Granted
            
            
            35,000
            
            
            7.68
            
            
            1,352,710
            
            
            2.93
            
            
            -
            
            
            -Exercised
            
            
            (1,513,000
            )
            
            1.50
            
            
            (8,000
            )
            
            1.75
            
            
            (618,000
            )
            
            1.31Cancelled
                or forfeited
            
            
            -
            
            
            -
            
            
            (40,800
            )
            
            2.60
            
            
            (12,400
            )
            
            1.98Outstanding
                at December 31,
            
            
            1,986,210
            
            
            2.33
            
            
            3,464,210
            
            
            1.92
            
            
            2,160,300
            
            
            1.29Options
                exercisable at December 31,
            
            
            759,872
            
            $
            1.15
            
            
            2,136,500
            
            $
            1.29
            
            
            2,144,300
            
            $
            1.29





Summarized
      information regarding all employee options outstanding at December 31, 2005,
      is
      as follows:





ExercisePrice
            
            NumberOutstandingAt
                Year End
            
            Weighted-AverageRemainingTerm
                in Years
            
            NumberExercisableAt
                Year End$0.75
            
            
            610,000
            
            
            2.8
            
            
            610,000$1.50
            
            
            7,500
            
            
            1.2
            
            
            7,500$1.75
            
            
            10,000
            
            
            5.3
            
            
            10,000$2.93
            
            
            1,323,710
            
            
            8.2
            
            
            132,372$7.68
            
            
            35,000
            
            
            9.9
            
            
            -1,986,210
            
            
            6.5
            
            
            759,872





***Subsidiary
      Preference Shares -*** **** In
      connection with the granting of a gaming license to CCAL by the Western Cape
      Gambling and Racing Board in April 2000, CCAL issued a total of 200 preference
      shares, 100 shares each to two minority shareholders, each of whom has one
      seat
      on the board of directors of CCAL, neither of whom is an officer, director
      or
      affiliate of CCI. The preference shares are not cumulative nor redeemable.
      The
      preference shares entitle the holders of the shares to dividends of 20% of
      the
      after-tax profits directly attributable to the CCAL casino business subject
      to
      working capital and capital expenditure requirements and CCAL loan obligations
      and liabilities as determined by the directors of CCAL. If the CCAL casino
      business is sold or otherwise dissolved, the preference shareholders are
      entitled to 20% of any surplus directly attributable to the CCAL casino
      business, net of all liabilities attributable to the CCAL casino business.
      No
      preference dividends were paid or are payable in the year 2005, 2004 or
      2003.


-F28-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








Subsequent
      to December 31, 2005, 200 preference shares of a new class (“Class A shares”)
      were authorized for issuance. These Class A shares will be available to the
      original preference shareholders in exchange for their original preference
      shares. The Class A shares are not cumulative nor redeemable. The Class A shares
      entitle the holders of such shares to dividends of .009% of the annual gross
      gambling revenue of the Caledon Hotel, Spa and Casino after the deduction of
      gaming taxes and value added tax. Furthermore, should the casino business be
      sold or otherwise dissolved, the Class A shareholders would be entitled to
      .009%
      of any surplus directly attributable to the casino business, net of all
      liabilities attributable to the casino business. The holders of Class A shares
      will also be entitled to a one time dividend of Rand 5,000 per share, offset
      by
      any amounts owed by the preference shareholder to CCAL. One preference
      shareholder has accepted the offer to transfer all 100 of their original
      preference shares for 100 of the new Class A shares when issued.





**9.**
            **PROMOTIONAL
                ALLOWANCES**





Promotional
      allowances presented in the consolidated statement of earnings for 2005, 2004
      and 2003 include the following:





*Amounts
                shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**Food
                & Beverage and Hotel Comps, at retail (1)
            
            $
            1,373
            
            $
            1,452
            
            $
            1,369Free
                Plays or Coupons
            
            
            1,573
            
            
            1,569
            
            
            1,882Player
                Points
            
            
            1,308
            
            
            1,269
            
            
            1,406**Total
                Promotional Allowances**
            
            **$**
            **4,254**
            ****
            **$**
            **4,290**
            ****
            **$**
            **4,657**





(1)
            The
                estimated cost of such complimentary services is charged to casino
                operations, and was $1.0 million, $1.1 million and $0.9 million in
                2005,
                2004 and 2003, respectively.





**10.**
            **INCOME
                TAXES**





The
      provision for income tax expense consists of the following:





*Amounts
                shown in thousands*
            
            **2005**
            
            **2004**
            
            **2003**Federal
                - Current
            
            $
            (172
            )
            $
            (308
            )
            $
            948Federal
                - Deferred
            
            
            42
            
            
            604
            
            
            203Provision
                for federal income taxes
            
            
            (130
            )
            
            296
            
            
            1,151State
                - Current
            
            
            (54
            )
            
            (45
            )
            
            128State
                - Deferred
            
            
            6
            
            
            82
            
            
            28Provision
                for state income taxes
            
            
            (48
            )
            
            37
            
            
            156Foreign
                - Current
            
            
            720
            
            
            548
            
            
            502Foreign
                - Deferred
            
            
            (195
            )
            
            (132
            )
            
            (32
            )Provision
                for foreign income taxes
            
            
            525
            
            
            416
            
            
            470Total
                Provision for income taxes
            
            $
            347
            
            $
            749
            
            $
            1,777


-F29-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








Reconciliation
      of federal income tax statutory rate and our effective tax rate is as
      follows:





**2005**
            
            **2004**
            
            **2003**Federal
                income tax statutory rate
            
            
            34.0
            %
            
            34.0
            %
            
            34.0
            %Foreign
                income taxes
            
            
            (21.0
            %)
            
            (16.1
            %)
            
            -State
                income tax (net of federal benefit)
            
            
            (0.8
            %)
            
            0.6
            %
            
            2.3
            %Non-deductible
                write-offs (recoveries) and expenses
            
            
            -
            
            
            (0.9
            %)
            
            -Effect
                of foreign currency translation adjustment for sale of
                Verkrans
            
            
            -
            
            
            (2.0
            %)
            
            -Effect
                of stock option exercises
            
            
            (10.9
            %)
            
            -
            
            
            -IRS
                audit accrual
            
            
            2.6
            %
            
            -
            
            
            -Permanent
                and other items
            
            
            4.7
            %
            
            (2.2
            %)
            
            (1.1
            %)Total
                Provision for income taxes
            
            
            8.6
            %
            
            13.4
            %
            
            35.2
            %





Deferred
      income taxes reflect the net tax effects of temporary differences between the
      carrying amounts of assets and liabilities for financial reporting purposes
      and
      the amounts used for income tax purposes. Deferred tax assets and liabilities
      at
      December 31, 2005 and 2004, consist of the following:





*Amounts
                shown in thousands*
              Deferred
                tax assets (liabilities) - U.S. federal and state:
            
            **2005**
            
            **2004**Deferred
                tax (liabilities) - non-current:Amortization
                of goodwill for tax
            
            $
            (880
            )
            $
            (667
            )Deferred
                tax assets - non-current::Property
                and equipment
            
            
            434
            
            
            214Write-down
                of non-operating casino property
            
            
            181
            
            
            169Other
            
            
            50
            
            
            50Total
                deferred tax assets - non-current
            
            
            665
            
            
            433Net
                deferred tax (liabilities) - non-current
            
            
            (215
            )
            
            (234
            )Prepaid
                expenses -current
            
            
            (111
            )
            
            -Accrued
                liabilities and other - current
            
            
            103
            
            
            97Net
                deferred tax (liabilities) assets - current
            
            
            (8
            )
            
            97Total
                deferred tax (liabilities) - U.S. federal and state
            
            $
            (223
            )
            $
            (137
            )


-F30-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








Deferred
                tax assets (liabilities) - foreign:Deferred
                tax (liabilities) - non-current:Property
                and equipment
            
            $
            (104
            )
            $
            -Deferred
                tax assets - non-current::Property
                and equipment
            
            
            -
            
            
            207NOL
                Carryforward
            
            
            297
            
            
            -Accrued
                liabilities and other
            
            
            187
            
            
            -Total
                deferred tax assets - non-current
            
            
            494
            
            
            207Net
                deferred tax assets - non-current
            
            
            380
            
            
            207Accrued
                liabilities and other - current
            
            
            125
            
            
            108Prepaid
                expenses - current
            
            
            (53
            )
            
            (20
            )Net
                deferred tax assets - current
            
            
            72
            
            
            88Total
                deferred tax assets - foreign
            
            $
            452
            
            $
            295Net
                deferred tax assets
            
            $
            229
            
            $
            158





**11.**
            **EARNINGS
                PER SHARE**


Basic
      and
      diluted earnings per share for the years ended December 31, 2005, 2004 and
      2003
      were computed as follows:





*Amounts
                shown in thousands, except share data*
            
            **2005**
            
            **2004**
            
            **2003**Basic
                Earnings Per Share:Net
                earnings
            
            $
            4,481
            
            $
            4,738
            
            $
            3,246Weighted
                average common shares
            
            
            15,923,585
            
            
            13,683,016
            
            
            13,633,092Basic
                earnings per share
            
            $
            0.28
            
            $
            0.35
            
            $
            0.24Diluted
                Earnings Per Share:Net
                earnings available to common shareholders
            
            $
            4,481
            
            $
            4,738
            
            $
            3,246Weighted
                average common shares
            
            
            15,923,585
            
            
            13,683,016
            
            
            13,633,092Effect
                of dilutive securities:Stock
                options and warrants
            
            
            2,155,588
            
            
            2,158,207
            
            
            1,154,905Dilutive
                potential common shares
            
            
            18,079,173
            
            
            15,841,223
            
            
            14,787,997Diluted
                earnings per share (*)
            
            $
            0.25
            
            $
            0.30
            
            $
            0.22





*
      There
      were no options or warrants excluded from the computation of the dilutive
      earnings per share.


-F31-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








**12.**
            **SEGMENT
                INFORMATION**





We
      are
      managed in six segments: Cripple Creek, Colorado; Central City, Colorado;
      Edmonton, Canada; South Africa; Cruise Ships; and Corporate and Other
      operations.





The
      operating results of the Cripple Creek, Colorado segment are those of WMCK
      and
      subsidiaries, which own Womacks Casino and Hotel (“Womacks”) in Cripple Creek,
      Colorado.





The
      operating results of the Central City, Colorado segment are those of CTI and
      subsidiary, which are developing a proposed casino and hotel.





The
      operating results of the Edmonton, Canada segment are those of CRA, which is
      developing a proposed casino and hotel.





The
      operating results of the South African segment are those of CCA and its
      subsidiaries, primarily CCAL, which owns the Caledon Hotel, Spa and
      Casino.





The
      cruise ship segment includes the revenues and expenses of the shipboard
      operations for which the Company has casino concessions agreements.





Corporate
      and Other operations include, among other items, the revenue and expense of
      corporate gaming projects for which we have secured long-term service contracts.




Earnings
        before interest, taxes, depreciation, amortization and minority interest
        (adjusted EBITDA) is not considered a measure of performance recognized as
        an
        accounting principle generally accepted in the United States of America.
        Management believes that adjusted EBITDA is a valuable measure of the relative
        performance amongst its operating segments. The gaming industry commonly
        uses
        adjusted EBITDA as a method of arriving at the economic value of a casino
        operation. It is also used by our lending institutions to gauge operating
        performance. Management uses adjusted EBITDA to compare the relative operating
        performance of separate operating units by eliminating the interest income,
        interest expense, income tax expense, and depreciation and amortization expense
        associated with the varying levels of capital expenditures for infrastructure
        required to generate revenue, and the oftentimes high cost of acquiring existing
        operations.


Segment
      information as of and for the years ended December 31, 2005, 2004 and 2003
      are
      presented below.


-F32-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS







*Amounts
                  shown in thousands*
              
              **Cripple
                  Creek, CO**
              
              **Central
                  City, CO****As
                  of and for the Year Ended December 31,**
              
              **2005**
              
              **2004**
              
              **2003**
              
              **2005**
              
              **2004**
              
              **2003****Property
                  and equipment, net**
              
              $
              23,206
              
              $
              22,985
              
              $
              21,392
              
              $
              21,105
              
              $
              9,200
              
              $
              -**Total
                  assets**
              
              $
              33,151
              
              $
              33,101
              
              $
              32,200
              
              $
              23,219
              
              $
              9,268
              
              $
              -**Net
                  operating revenue**
              
              $
              17,111
              
              $
              17,561
              
              $
              18,430
              
              $
              6
              
              $
              -
              
              $
              -**Operating
                  expenses excluding depreciation)**
              
              $
              10,937
              
              $
              11,055
              
              $
              10,745
              
              $
              567
              
              $
              8
              
              $
              -**Depreciation**
              
              $
              1,703
              
              $
              1,512
              
              $
              1,349
              
              $
              -
              
              $
              -
              
              $
              -**Earnings
                  from unconsolidated subsidiary**
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -**Earnings
                  (loss) from operations**
              
              $
              4,471
              
              $
              4,994
              
              $
              6,336
              
              $
              (561
              )
              $
              (8
              )
              $
              -**Interest
                  income**
              
              $
              13
              
              $
              12
              
              $
              12
              
              $
              -
              
              $
              -
              
              $
              -**Interest
                  expense, including debt issuance cost, net**
              
              $
              (259
              )
              $
              (123
              )
              $
              1
              
              $
              (296
              )
              $
              -
              
              $
              -**Early
                  debt repayment expense**
              
              $
              
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -**Other
                  income (expense), net**
              
              $
              -
              
              $
              -
              
              $
              2
              
              $
              -
              
              $
              -
              
              $
              -**Non-operating
                  items from unconsolidated subsidiary**
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -**Earnings
                  (loss) before income taxes and minority interest**
              
              $
              4,743
              
              $
              5,129
              
              $
              6,349
              
              $
              (857
              )
              $
              (8
              )
              $
              -**Income
                  tax expense**
              
              $
              1,802
              
              $
              1,949
              
              $
              2,413
              
              $
              -
              
              $
              -
              
              $
              -**Minority
                  interest**
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              857
              
              $
              8
              
              $
              -**Net
                  Earnings (loss)**
              
              $
              2,941
              
              $
              3,180
              
              $
              3,936
              
              $
              -
              
              $
              -
              
              $
              -**Reconciliation
                  to adjusted
                  EBITDA:****Net
                  earnings (loss)**
              
              $
              2,941
              
              $
              3,180
              
              $
              3,936
              
              $
              -
              
              $
              -
              
              $
              -**Minority
                  interest**
              
              $
              -
              
              
              -
              
              
              -
              
              
              (857
              )
              
              (8
              )
              
              -**Interest
                  income**
              
              $
              (13
              )
              $
              (12
              )
              $
              (12
              )
              $
              -
              
              $
              -
              
              $
              -**Interest
                  expense**
              
              $
              (259
              )
              $
              (123
              )
              $
              1
              
              $
              296
              
              $
              -
              
              $
              -**Early
                  debt repayment expense**
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -**Income
                  taxes**
              
              $
              1,802
              
              $
              1,949
              
              $
              2,413
              
              $
              -
              
              $
              -
              
              $
              -**Depreciation**
              
              $
              1,703
              
              $
              1,512
              
              $
              1,349
              
              $
              -
              
              $
              -
              
              $
              -**Adjusted
                  EBITDA**
              
              $
              6,174
              
              $
              6,506
              
              $
              7,687
              
              $
              (561
              )
              $
              (8
              )
              $
              -




-F33-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








*Amounts
                shown in thousands*
            
            **Edmonton,
                Canada**
            
            **South
                Africa****As
                of and for the Year Ended December 31,**
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2005**
            
            **2004**
            
            **2003****Property
                and equipment, net**
            
            $
            8,750
            
            $
            -
            
            $
            -
            
            $
            15,215
            
            $
            15,592
            
            $
            14,020**Total
                assets**
            
            $
            9,654
            
            $
            -
            
            $
            -
            
            $
            26,147
            
            $
            24,975
            
            $
            19,771**Net
                operating revenue**
            
            $
            57
            
            $
            -
            
            $
            -
            
            $
            17,015
            
            $
            15,334
            
            $
            11,149**Operating
                expenses (excluding depreciation)**
            
            $
            236
            
            $
            -
            
            $
            -
            
            $
            10,519
            
            $
            9,800
            
            $
            7,893**Depreciation**
            
            $
            3
            
            $
            -
            
            $
            -
            
            $
            1,473
            
            $
            1,343
            
            $
            1,073**Earnings
                from unconsolidated subsidiary**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -**Earnings
                (loss) from operations**
            
            $
            (182
            )
            $
            -
            
            $
            -
            
            $
            5,023
            
            $
            4,191
            
            $
            2,183**Interest
                income**
            
            $
            12
            
            $
            -
            
            $
            -
            
            $
            198
            
            $
            150
            
            $
            189**Interest
                expense, including debt issuance cost, net**
            
            $
            (61
            )
            $
            -
            
            $
            -
            
            $
            (683
            )
            $
            (788
            )
            $
            (929
            )**Early
                debt repayment expense**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (181
            )
            $
            -
            
            
            -**Other
                income (expense), net**
            
            $
            13
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            1
            
            $
            (7
            )**Non-operating
                items from unconsolidated subsidiary**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -**Earnings
                (loss) before income taxes and minority interest**
            
            $
            (218
            )
            $
            -
            
            $
            -
            
            $
            4,357
            
            $
            3,554
            
            $
            1,436**Income
                tax expense (benefit)**
            
            $
            (81
            )
            $
            -
            
            $
            -
            
            $
            1,255
            
            $
            906
            
            $
            487**Minority
                interest**
            
            $
            61
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (22
            )**Net
                Earnings (loss)**
            
            $
            (76
            )
            $
            -
            
            $
            -
            
            $
            3,102
            
            $
            2,648
            
            $
            927**Reconciliation
                to adjusted EBITDA:****Net
                earnings (loss)**
            
            $
            (76
            )
            $
            -
            
            $
            -
            
            $
            3,102
            
            $
            2,648
            
            $
            927**Minority
                interest**
            
            $
            (61
            )
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            22**Interest
                income**
            
            $
            (12
            )
            $
            -
            
            $
            -
            
            $
            (198
            )
            $
            (150
            )
            $
            (189
            )**Interest
                expense**
            
            $
            61
            
            $
            -
            
            $
            -
            
            $
            683
            
            $
            788
            
            $
            929**Early
                debt repayment expense**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            181
            
            $
            -
            
            $
            -**Income
                taxes**
            
            $
            (81
            )
            $
            -
            
            $
            -
            
            $
            1,255
            
            $
            906
            
            $
            487**Depreciation**
            
            $
            3
            
            $
            -
            
            $
            -
            
            $
            1,473
            
            $
            1,343
            
            $
            1,073**Adjusted
                EBITDA**
            
            $
            (166
            )
            $
            -
            
            $
            -
            
            $
            6,496
            
            $
            5,535
            
            $
            3,249




-F34-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








*Amounts
                shown in thousands*
            
            **Cruise
                Ships**
            
            **Corporate
                & Other****As
                of and for the Year Ended December 31,**
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2005**
            
            **2004**
            
            **2003****Property
                and equipment, net**
            
            $
            854
            
            $
            386
            
            $
            327
            
            $
            472
            
            $
            466
            
            $
            1,057**Total
                assets**
            
            $
            1,629
            
            $
            1,028
            
            $
            731
            
            $
            29,763
            
            $
            2,832
            
            $
            2,115**Net
                operating revenue**
            
            $
            3,151
            
            $
            2,769
            
            $
            1,737
            
            $
            105
            
            $
            101
            
            $
            114**Operating
                expenses (excluding depreciation)**
            
            $
            2,142
            
            $
            1,836
            
            $
            1,175
            
            $
            3,741
            
            $
            3,120
            
            $
            2,117**Depreciation**
            
            $
            144
            
            $
            110
            
            $
            74
            
            $
            26
            
            $
            28
            
            $
            172**(Loss)
                earnings from unconsolidated subsidiary**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (109
            )
            $
            55
            
            $
            -**Earnings
                (loss) from operations**
            
            $
            865
            
            $
            823
            
            $
            488
            
            $
            (3,771
            )
            $
            (2,992
            )
            $
            (2,175
            )**Interest
                income**
            
            $
            -
            
            $
            -
            
            $
            1
            
            $
            253
            
            $
            6
            
            $
            2**Interest
                expense, including debt issuance cost, net**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (1,328
            )
            $
            (922
            )
            $
            (1,081
            )**Early
                debt repayment expense**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -**Other
                income (expense), net**
            
            $
            -
            
            $
            -
            
            $
            16
            
            $
            -
            
            $
            -
            
            $
            9**Non-operating
                items from unconsolidated subsidiary**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (4
            )
            $
            (5
            )
            $
            -**Earnings
                (loss) before income taxes and minority interest**
            
            $
            865
            
            $
            823
            
            $
            505
            
            $
            (4,850
            )
            $
            (3,913
            )
            $
            (3,245
            )**Income
                tax expense (benefit)**
            
            $
            26
            
            $
            25
            
            $
            150
            
            $
            (2,655
            )
            $
            (2,131
            )
            $
            (1,273
            )**Minority
                interest**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            (130
            )
            $
            (106
            )
            $
            -**Net
                Earnings (loss)**
            
            $
            839
            
            $
            798
            
            $
            355
            
            $
            (2,325
            )
            $
            (1,888
            )
            $
            (1,972
            )**Reconciliation
                to
                adjusted EBITDA:****Net
                earnings (loss)**
            
            $
            839
            
            $
            798
            
            $
            355
            
            $
            (2,325
            )
            $
            (1,888
            )
            $
            (1,972
            )**Minority
                interest**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            130
            
            $
            106
            
            $
            -**Interest
                income**
            
            $
            -
            
            $
            -
            
            $
            (1
            )
            $
            (253
            )
            $
            (6
            )
            $
            (2
            )**Interest
                expense**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            1,328
            
            $
            922
            
            $
            1,081**Early
                debt repayment expense**
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -**Income
                taxes**
            
            $
            26
            
            $
            25
            
            $
            150
            
            $
            (2,655
            )
            $
            (2,131
            )
            $
            (1,273
            )**Depreciation**
            
            $
            144
            
            $
            110
            
            $
            74
            
            $
            26
            
            $
            28
            
            $
            172**Adjusted
                EBITDA**
            
            $
            1,009
            
            $
            933
            
            $
            578
            
            $
            (3,749
            )
            $
            (2,969
            )
            $
            (1,994
            )




-F35-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS







*Amounts
                shown in thousands*
            
            **Consolidated****As
                of and for the Year Ended December 31,**
            
            **2005**
            
            **2004**
            
            **2003****Property
                and equipment, net**
            
            $
            69,602
            
            $
            48,629
            
            $
            36,796**Total
                assets**
            
            $
            123,563
            
            $
            71,204
            
            $
            54,817**Net
                operating revenue**
            
            $
            37,445
            
            $
            35,765
            
            $
            31,430**Operating
                expenses (excluding depreciation)**
            
            $
            28,142
            
            $
            25,819
            
            $
            21,930**Depreciation**
            
            $
            3,349
            
            $
            2,993
            
            $
            2,668**(Loss)
                earnings from unconsolidated subsidiary**
            
            $
            (109
            )
            $
            55
            
            $
            -**Earnings
                (loss) from operations**
            
            $
            5,845
            
            $
            7,008
            
            $
            6,832**Interest
                income**
            
            $
            476
            
            $
            168
            
            $
            204**Interest
                expense, net, including debt issuance cost**
            
            $
            (2,109
            )
            $
            (1,587
            )
            $
            (2,011
            )**Early
                debt repayment expense**
            
            $
            (181
            )
            $
            -
            
            $
            -**Other
                income (expense), net**
            
            $
            13
            
            $
            1
            
            $
            20**Non-operating
                items from unconsolidated subsidiary**
            
            $
            (4
            )
            $
            (5
            )
            $
            -**Earnings
                (loss) before income taxes and minority interest**
            
            $
            4,040
            
            $
            5,585
            
            $
            5,045**Income
                tax expense**
            
            $
            347
            
            $
            749
            
            $
            1,777**Minority
                interest**
            
            $
            788
            
            $
            (98
            )
            $
            (22
            )**Net
                Earnings (loss)**
            
            $
            4,481
            
            $
            4,738
            
            $
            3,246**Reconciliation
                to adjusted EBITDA:****Net
                earnings (loss)**
            
            $
            4,481
            
            $
            4,738
            
            $
            3,246**Minority
                interest**
            
            $
            (788
            )
            $
            98
            
            $
            22**Interest
                income**
            
            $
            (476
            )
            $
            (168
            )
            $
            (204
            )**Interest
                expense**
            
            $
            2,109
            
            $
            1,587
            
            $
            2,011**Early
                debt repayment expense**
            
            $
            181
            
            $
            -
            
            $
            -**Income
                taxes**
            
            $
            347
            
            $
            749
            
            $
            1,777**Depreciation**
            
            $
            3,349
            
            $
            2,993
            
            $
            2,668**Adjusted
                EBITDA**
            
            $
            9,203
            
            $
            9,997
            
            $
            9,520


-F36-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








**13.**
            **COMMITMENTS,
                CONTINGENCIES AND OTHER MATTERS**





***South
      African Tax Audit*** - The
      Company’s tax return in South Africa for 2000 and 2001 has been
      audited by the South African Revenue Service (“SARS”) and we were assessed
      additional tax and interest of $0.3 million (Rand 1.9 million) which we are
      appealing. We have been notified that our appeal will be heard in May 2006.
      We
      have established a receivable in the amount of approximately $0.3 million (Rand
      1.9 million), of which approximately $0.1 million (Rand 0.5 million) consists
      of
      accrued interest, for the recovery of taxes assessed by SARS and paid by Caledon
      in 2005. Although there can be no assurances, at this time management believes
      that it is probable that Caledon will be successful in its appeal.





***2003
      Tax Audit*** - The
      Company’s 2003 US tax return is currently being audited by the United States
      Internal Revenue Service (“IRS”). As of December 31, 2005, the IRS has not
      issued any assessment. We do not expect any settlement that might result from
      the audit to be materially in excess of amounts accrued.





***South
      Africa - Gauteng*** - During
      September 2001, our subsidiary, Century Casinos Africa entered into an agreement
      to secure a 50% ownership interest in Rhino Resort Ltd (Rhino), a consortium
      which includes Silverstar Development Ltd. (Silverstar). Rhino submitted an
      application for a proposed hotel/casino resort development in a region of the
      greater Johannesburg area of South Africa known as the West Rand at a cost
      of
      approximately 400 million Rand ($59.8 million). In November 2001, Rhino was
      awarded the sixth and final casino license serving the Gauteng province in
      South
      Africa. In February 2002, Tsogo Sun Holdings (Pty) Ltd (Tsogo), a competing
      casino, filed a Review Application seeking to overturn the license award by
      the
      Gauteng Gambling Board (GGB). In September 2002, the High Court of South Africa
      overturned the license award. As a result of these developments, in 2002 the
      Company recorded a $0.4 million write-off for all advances made, and
      pre-construction cost incurred, in conjunction with the Johannesburg project.
      In
      November 2002, and upon the advice of legal counsel, Silverstar, with the
      support and agreement of all other parties to the original two applications
      for
      the West Rand license, including our subsidiary, Century Casinos Africa, made
      representation to the GGB requesting that the sole remaining license for the
      province of Gauteng be awarded to Silverstar pursuant to its original 1997
      application. The GGB in December 2002 denied Silverstar’s request. As a result,
      Silverstar on March 4, 2003 initiated legal action against the GGB in the High
      Court of South Africa seeking, inter alia, that the court compel the authorities
      to award the license to Silverstar. In October 2003 a judgment was handed down
      from the High Court of South Africa compelling the GGB to award a casino license
      to Silverstar for the western periphery of metropolitan Johannesburg upon the
      terms of its original 1997 application. In November 2003 the GGB’s subsequent
      application for leave to appeal the October 2003 judgment was denied by the
      High
      Court. In December 2003, the GGB served notice to petition the South African
      Supreme Court of Appeal requesting a further appeal against the judgment of
      the
      High Court. In February 2004, the Supreme Court of Appeal of South Africa
      granted the GGB’s request for leave to appeal. Silverstar has informed the
      Company that the Supreme Court of Appeal met on February 28, 2005 to review
      Silverstar’s petition against the leave to appeal granted to the GGB, at which
      time the court reserved judgment. On March 29, 2005, Silverstar reported that
      the Supreme Court of Appeal dismissed the appeal of the GGB and upheld the
      earlier High Court decision to award the license to Silverstar.


-F37-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








On
      December 1, 2004, CCI announced it agreed to sell its interest, including the
      call option with Novomatic AG discussed below, in the Gauteng, South Africa
      license application to the Akani Group. The Akani Group has agreed to provide
      the funds necessary for Silverstar to complete the project and to acquire all
      of
      the outstanding shares of Silverstar as well as all assets, rights and
      obligations of CCI in the project.


The
        total
        selling price was approximately $8.5 million, or 50.3 million Rand, of which
        $6.8 million (40.3 million Rand) is contingent upon regulatory and related
        approvals being secured by Silverstar and the Akani group. An initial payment
        of
        approximately $1.7 million, or 10.0 million Rand, was received for both the
        sale
        of 100% of the outstanding common stock of Verkrans Ontwikkelings Maatskappy
        (Pty) Ltd., a wholly owned subsidiary of CCA, whose only asset was land,
        carried
        at 4.4 million Rand, and previously advanced funds to Silverstar. Also in
        conjunction with the agreements, we loaned Silverstar $0.5 million (3.0 million
        Rand), of which the entire amount was fully reserved, repayable in six equal
        annual installments with interest commencing January 1, 2007. We have,
        therefore, only recognized net proceeds of 7.0 million Rand in the transaction.
        The shares were sold for book value, less the cost of disposition. We recognized
        a foreign currency translation gain of $0.4 million on the disposition of
        Verkrans, resulting from the difference between the exchange rate at the
        time of
        purchase in March 2002 and the exchange rate at the time of sale in December
        2004. The foreign currency translation gain, less the cost of disposition,
        or
        $0.4 million is included in other operating revenue for 2004. The excess
        amount
        was first applied to receivables which had not been written off, totaling
        1.6
        million Rand and the remaining 1.0 million Rand or $0.2 million was applied
        to
        advances written off in 2002 and the recovery is reported in general and
        administrative expenses for 2004. The balance of the selling price of
        approximately $6.8 million, or 40.3 million Rand, is contingent on certain
        approvals being secured by Silverstar and the Akani Group and has not been
        recorded by the Company.





In
      January 2000, CCI entered into a brokerage agreement with Novomatic AG in which
      CCI received an option to purchase seven eighths of the shares that Novomatic
      AG
      purchased in Silverstar. The agreement has subsequently been amended two times,
      most recently in October 2004 eliminating the put option held by Novomatic
      AG,
      transferring the rights under the agreement from CCI to our subsidiary, Century
      Resorts Ltd. and amending the call option under which we can require Novomatic
      AG to sell seven eighths of its shares in Silverstar to Century Resorts Ltd.
      The
      call option can be exercised at any time within three years of the amended
      and
      restated agreement. The right to the equity option was transferred to the Akani
      Group in conjunction with the sale in December 2004.





***Employee
      Benefit Plan*** - In
      March 1998, we adopted a 401(k) Savings and Retirement Plan (the “Plan”). The
      Plan allows eligible employees to make tax-deferred contributions that are
      matched by the Company up to a specified level. Participants become fully vested
      in employer contributions over a six-year period. The Company contributed less
      than $0.1 million to the Plan in each of 2005, 2004 and 2003.





***Operating
      Lease Commitments and Purchase Options*** **-** We
      have
      entered into certain noncancelable operating leases for real property and
      equipment. Rental expense was $0.4 million in each of 2005, 2004 and 2003.





In
      June
      1998, we began leasing parking spaces from the City of Cripple Creek under
      a
      five-year agreement. We may purchase the property for $3.3 million, less
      cumulative lease payments ($0.7 million through December 31, 2005), at any
      time
      during the lease term. In February 2000, the agreement was amended to extend
      the
      term to 2010.


-F38-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS








I n
      March 1999, we entered into a purchase option agreement for a property in
      Cripple Creek, Colorado, situated across the street from the Womacks casino
      on
      Bennett Avenue. The agreement, as amended on February 7, 2000, provides for
      an
      option period through March 31, 2004 and an exercise price of $1.5 million,
      less
      50% of cumulative monthly option payments. In January 2004, we sold the option
      to an unrelated party for a sum of $0.2 million.





Following
      is a summary of operating lease commitments as of December 31,
      2005:





*Amounts
      shown in thousands.*


**Year
                ending December 31,**
            
            
            Amount2006
            
            $
            3512007
            
            
            1282008
            
            
            1272009
            
            
            1072010
            
            
            38Total
            
            $
            751





***Stock
      Redemption Requirement*** -
      Colorado gaming regulations require the disqualification of any shareholder
      who
      may be determined by the Colorado Division of Gaming to be unsuitable as an
      owner of a Colorado casino. Unless a sale of such common stock to an acceptable
      party could be arranged, we would repurchase the common stock of any shareholder
      found to be unsuitable under the regulations. We could effect the repurchase
      with cash, Redemption Securities, as such term is defined in our Certificate
      of
      Incorporation and
      having terms and conditions as shall be approved by the Board of
      Directors ,
      or a
      combination thereof.





**14.**
            **UNAUDITED
                SUMMARIZED QUARTERLY DATA**





Summarized
      quarterly financial data for 2005, 2004 and 2003 is as follows:





*Amounts
                shown in thousands except share information:*
            
            1st
                Quarter
            
            2nd
                Quarter
            
            3rd
                Quarter
            
            4th
                QuarterYear
                ended December 31, 2005Net
                operating revenue
            
            $
            9,228
            
            $
            8,908
            
            $
            10,030
            
            $
            9,279Earnings
                from operations
            
            $
            1,558
            
            $
            877
            
            $
            1,945
            
            $
            1,465Net
                earnings
            
            $
            1,007
            
            $
            509
            
            $
            1,281
            
            $
            1,684Basic
                earnings per share (1)
            
            $
            0.07
            
            $
            0.04
            
            $
            0.09
            
            $
            0.08Diluted
                earnings per share (1)
            
            $
            0.06
            
            $
            0.03
            
            $
            0.08
            
            $
            0.07





Year
                ended December 31, 2004Net
                operating revenue (2) (3)
            
            $
            8,164
            
            $
            8,853
            
            $
            9,671
            
            $
            9,077Earnings
                from operations (2) (3)
            
            $
            1,743
            
            $
            1,858
            
            $
            2,102
            
            $
            1,305Net
                earnings (2)
            
            $
            904
            
            $
            1,147
            
            $
            1,233
            
            $
            1,454Basic
                earnings per share (1)
            
            $
            0.07
            
            $
            0.08
            
            $
            0.09
            
            $
            0.11Diluted
                earnings per share (1)
            
            $
            0.06
            
            $
            0.07
            
            $
            0.08
            
            $
            0.09





Year
                ended December 31, 2003Net
                operating revenue
            
            $
            7,381
            
            $
            7,553
            
            $
            8,278
            
            $
            8,190Earnings
                from operations
            
            $
            1,698
            
            $
            1,667
            
            $
            1,776
            
            $
            1,663Net
                earnings
            
            $
            755
            
            $
            751
            
            $
            914
            
            $
            826Basic
                earnings per share (1)
            
            $
            0.06
            
            $
            0.06
            
            $
            0.07
            
            $
            0.06Diluted
                earnings per share (1)
            
            $
            0.05
            
            $
            0.05
            
            $
            0.06
            
            $
            0.06




-F39-
 *Index*


**CENTURY
      CASINOS, INC. AND SUBSIDIARIES**


NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





(1)
              Sum
                  of quarterly results may differ from annual results presented in
                  Note 12,
                  Earnings per Share, to the Consolidated Financial Statements, and
                  the
                  Statement of Earnings because of
                  rounding.
 
 (2)
              In
                  the 4thquarter of 2004 we recognized a $0.4 million gain from the sale
                  of
                  Verkrans, which is reported in net operating revenue. We also recovered
                  approximately $0.2 million in receivables previously written off
                  in 2002,
                  which is reported in earnings from
                  operations.
 
 (3)
              For
                  the 1st,
                  2nd,
                  and 3rdquarter of 2004, certain reclassifications have been made to net
                  operating
                  revenue and earnings from operations to conform to the 4thquarter presentation.
 
 **15.**
              **TRANSACTIONS
                  WITH RELATED PARTIES**
 
 On
        April
        1, 2004, the Company paid $0.4 million to Thomas Graf, a founding stockholder
        of
        the Company for the settlement of an unsecured note payable.
 
 We
        have
        entered into compensation agreements with certain members of the Board of
        Directors. Specifically, we have entered into separate management agreements
        with Flyfish Casino Consulting AG, a management company controlled by Erwin
        Haitzmann and with Focus Casino Consulting AG, a management company controlled
        by Peter Hoetzinger, to secure the services of each director, respectively.
        Included in the consolidated statements of earnings for the years ended December
        31, 2005, 2004 and 2003 are payments to Flyfish Casino Consulting in the
        amounts
        of $0.5 million, $0.5 million and $0.4 million, respectively, and payments
        to
        Focus Casino Consulting in the amounts of $0.5 million, $0.5 million, $0.4
        million, respectively.
 
 Erwin
        Haitzmann, Peter Hoetzinger and their respective family trusts own a minority
        interest in CRL. Collectively they own approximately 3.5% of CRL’s outstanding
        shares of common stock .
 
 During
        2004, James Forbes, a former member of the Company’s Board of Directors and a
        current board member of Century Casinos Caledon Proprietary Limited, loaned
        $0.1
        million to the Company to secure a note to Silverstar. The Company repaid
        the
        loan in December 2004.
 
 There
        have been no transactions with management, except as otherwise disclosed
        herein.
  -F40-