SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)

|(X)                                                                                                                                                                                                                                                                                                                                                                |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------------------------------------------------------------------------------------
|For the quarterly period ended September 27, 2001
                               OR                                                                                                                                                                                                                                                                               
|( )                                                                                                                                                                                                                                                                                                                                                                |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|For the transition period from   to                                                                                                                                                                                                                                                                                                                               
|Commission file number  1-5440                                                                                                                                                                                                                                                                                                                                    
|AZTAR CORPORATION            (Exact name of registrant as specified in its charter)                                                                                                                                                                                                                                                                               
|Delaware
(State or other jurisdiction of
 incorporation or organization)                                                                                                                                                                                                                                                                                           |  | 86-0636534
       (I.R.S. Employer 
        Identification No.)                         
|2390 East Camelback Road, Suite 400, Phoenix, Arizona            85016
(Address of principal executive offices)                      (Zip Code)                                                                                                                                                                                                                   
|Registrant¢
s telephone number, including area code (602) 381-4100                                                                                                                                                                                                                                                                                                
|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
|At October 25, 2001, the registrant had outstanding 36,555,764 shares of its common stock, $.01 par value.                                                                                                                                                                                                                                                        



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AZTAR CORPORATION AND SUBSIDIARIES
FORM 10-Q
INDEX

|         |                                                                                                                         |          
|-------- | ----------------------------------------------------------------------------------------------------------------------- | ---------
|PART I.  | FINANCIAL INFORMATION                                                                                                   | PAGE
----
|Item 1.  | Financial Statements                                                                                                    |          
|         | Consolidated Balance Sheets at September 27, 2001 and
December 28, 2000                                                 | 3        
|         | Consolidated Statements of Operations for the quarters and 
nine months ended September 27, 2001 and September 28, 2000 | 5        
|         | Consolidated Statements of Cash Flows for the nine months 
ended September 27, 2001 and September 28, 2000              | 6        
|         | Consolidated Statements of Shareholders' Equity for the 
nine months ended September 27, 2001 and September 28, 2000    | 8        
|         | Notes to Consolidated Financial Statements                                                                              | 9        
|Item 2.  | Management's Discussion and Analysis of Financial
Condition and Results of Operations                                   | 13       
|Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                                                              | 19       
|PART II. | OTHER INFORMATION                                                                                                       |          
|Item 1.  | Legal Proceedings                                                                                                       | 19       
|Item 6.  | Exhibits and Reports on Form 8-K                                                                                        | 19       

2

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AZTAR CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS (unaudited) (in thousands, except share data)

|Assets
Current assets:
  Cash and cash equivalents
  Accounts receivable, net
  Inventories
  Prepaid expenses
  Deferred income taxes, net
    Total current assets
Investments in and advances to unconsolidated
  partnership
Other investments
Property and equipment:
  Buildings, riverboats and equipment, net
  Land
  Construction in progress
  Leased under capital leases, net
Deferred charges and other assets | September 27,2001
$   81,650  
21,619  
8,082  
10,148  17,599  
139,098  
6,566  
23,124  
713,654  
104,957  
27,733  715  
847,059  36,288  
$1,052,135  
========== | December 28,2000
$   48,080  
21,769  
8,446  
9,987  18,938  
107,220  
7,007  
21,523  
727,164  
104,957  
6,090  1,390  
839,601  36,345  
$1,011,696  
==========
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------



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

3

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AZTAR CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS (unaudited)(continued)
 (in thousands, except share data)



|Liabilities and Shareholders' Equity
Current liabilities:
  Accounts payable and accruals
  Accrued payroll and employee benefits
  Accrued interest payable
  Income taxes payable
  Current portion of long-term debt
  Current portion of other long-term liabilities
    Total current liabilities
Long-term debt
Other long-term liabilities
Deferred income taxes
Contingencies and commitments
Series B ESOP convertible preferred stock
   (redemption value $8,862 and $11,905)
Shareholders' equity:
  Common stock, $.01 par value (36,843,131 and
    38,696,672 shares outstanding)
  Paid-in capital
  Retained earnings
  Less: Treasury stock
    Total shareholders' equity | September 27,2001
$   60,540  
26,894  
11,095  
4,737  
1,353  1,498  
106,117  
459,042  
20,031  
16,518  
6,070  
516  
430,268  
160,834  (147,261) 444,357  
$1,052,135  
========== | December 28,2000
$   53,356  
27,377  
5,470  
4,764  
1,608  1,544  
 
94,119  
463,011  
20,307  
5,153  
6,400  
515  
428,537  
116,194  (122,540) 422,706  
$1,011,696  
==========
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

4

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AZTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)For the periods ended September 27, 2001 and September 28, 2000
 (in thousands, except per share data)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Third Quarter                                                                                                                                                                                                                                   | Nine Months                                                                                                                                                                                                                                         
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues
  Casino
  Rooms
  Food and beverage
  Other
Costs and expenses
  Casino
  Rooms
  Food and beverage
  Other
  Marketing
  General and administrative
  Utilities
  Repairs and maintenance
  Provision for doubtful accounts
  Property taxes and insurance
  Rent
  Depreciation and amortization
Operating income
  Interest income
  Interest expense
  Equity in unconsolidated
    partnership's loss
Income before income taxes
  Income taxes
Net income
Net income per common share
Net income per common share 
  assuming dilution
Weighted-average common shares
  applicable to:
  Net income per common share
  Net income per common share
    assuming dilution | 2001 
$175,014 
19,434 
13,769 9,896 
218,113 
72,063 
10,189 
13,596 
8,206 
21,752 
19,156 
5,088 
6,103 
1,092 
6,358 
4,306 12,861 180,770 
37,343 
392 
(9,529)(845)
27,361 (9,536)
$ 17,825 
======== 
$    .47 
$    .46 
37,223 
38,879 | 2000 
 
$177,389 
19,270 
14,672 10,874 
222,205 
77,367 
10,292 
14,558 
8,922 
22,174 
19,696 
4,730 
6,094 
540 
6,079 
4,478 13,478 188,408 
33,797 
313 
 (10,407)(1,081)
22,622 (8,070)
$ 14,552 
======== 
$    .35 
$    .34 
40,428 
42,397

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

5

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AZTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)For the periods ended September 27, 2001 and September 28, 2000(in thousands)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | Nine Months                                                                                                                                                                                                                    
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities
Net income
Adjustments to reconcile net income to net cash
  provided by (used in) operating activities:
    Depreciation and amortization
    Provision for losses on accounts receivable
    Loss on reinvestment obligation
    Rent expense
    Distribution in excess of equity in income
      of partnership
    Deferred income taxes
    Change in assets and liabilities:
      (Increase) decrease in accounts receivable
      (Increase) decrease in refundable income taxes
      (Increase) decrease in inventories and 
        prepaid expenses
      Increase (decrease) in accounts payable,
        accrued expenses and income taxes payable
      Other items, net
  Net cash provided by (used in) operating activities
Cash Flows from Investing Activities
Reduction in other investments
Purchases of property and equipment
Additions to other long-term assets
  Net cash provided by (used in) investing activities
Cash Flows from Financing Activities
Proceeds from issuance of long-term debt
Proceeds from issuance of common stock
Principal payments on long-term debt
Principal payments on other long-term liabilities
Debt issuance costs
Repurchase of common stock
Preferred stock dividend
Redemption of preferred stock
  Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
    Cash and cash equivalents at end of period | 2001 
$ 45,228 
39,723 
2,936 
964 
(753)
441 
12,704 
(2,786)
-- 
203 
12,799 273 111,732 
1,380 
(41,805)(4,303)(44,728)
305,100 
1,350 
(309,369)
(26)
(4,732)
(24,708)
(499)(550)(33,434)
33,570 48,080 
$ 81,650 
========

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

6

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AZTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)(continued)For the periods ended September 27, 2001 and September 28, 2000
(in thousands)



|                                                                                                                                                                                                                                                                                                                                                                                                   | Nine Months                         
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------
|Supplemental Cash Flow Disclosures
Summary of non-cash investing and financing activities:
  Exchange of common stock in lieu of cash payments in 
    connection with the exercise of stock options
  Other long-term liabilities reduced for deferred charges
    and other assets
Cash flow during the period for the following:
  Interest paid, net of amount capitalized
  Income taxes paid | 2001 
$     13 
50 
$ 22,130 
12,426

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

7

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AZTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (unaudited)For the periods ended September 27, 2001 and September 28, 2000
 (in thousands, except number of shares)



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Nine Months                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------
|Common stock:
  Beginning balance
  Stock options exercised for 178,334 and 723,523 shares
    Ending balance
Paid-in capital:
  Beginning balance
  Stock options exercised
  Tax benefit from stock options exercised
    Ending balance
Retained earnings:
  Beginning balance
  Preferred stock dividend and losses on redemption
  Net income
    Ending balance
Treasury stock:
  Beginning balance
  Repurchase of 2,031,000 and 3,753,800 shares of common
    stock at cost
  Repurchase of 1,081 and 95,543 shares of common stock,
    at cost, in connection with stock options exercised
    Ending balance | 2001 
$    515 1 516 
428,537 
1,362 369 430,268 
116,194 
(588)45,228 160,834 
(122,540)
(24,708)(13)(147,261)
$444,357 
========

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

8

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AZTAR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Note 1:  General
The consolidated financial statements reflect all adjustments, such adjustments being normal recurring accruals, which are necessary, in the opinion of management, for the fair presentation of the results of the interim periods; interim results, however, may not be indicative of the results for the full year.
The notes to the interim consolidated financial statements are presented to enhance the understanding of the financial statements and do not necessarily represent complete disclosures required by generally accepted accounting principles.  Other revenue consists of revenue from many various sources such as entertainment, retail outlets including gift shops, telephone, commissions and surcharges, hotel services and admissions to our riverboats.  These revenues are recognized as earned which generally coincides with payment in cash or by credit card.  The interest that was capitalized during the third quarter and nine months ended 2001 was $357,000 and $835,000, respectively.  There was no interest capitalized during the third quarter or nine months ended 2000.  Capitalized costs related to various development projects, included in deferred charges and other assets, were $5,691,000 and $7,358,000 at September 27, 2001 and December 28, 2000, respectively.  For additional information regarding significant accounting policies, Las Vegas Tropicana redevelopment, long-term debt, lease obligations, and other matters applicable to the Company, reference should be made to the Company's Annual Report to Shareholders for the year ended December 28, 2000.

Note 2: Investments in and Advances to Unconsolidated Partnership
Following are summarized operating results for the Company¢
s unconsolidated partnership, accounted for using the equity method for the periods ended September 27, 2001 and September 28, 2000 (in thousands):

|                                                                             | Third Quarter                                       | Nine Months                                          
|---------------------------------------------------------------------------- | --------------------------------------------------- | -----------------------------------------------------
|Revenues
Operating expenses
Operating income
Interest expense
    Net income | 2001 
$  4,111 (684)
3,427 (737)
$  2,690 
======== | 2000 
$  4,514 (684)
3,830 (1,199)
$  2,631 
========

The Company's share of the above operating results, after intercompany eliminations, is as follows (in thousands):

|                                               | Third Quarter   | Nine Months    
|---------------------------------------------- | --------------- | ---------------
|Equity in unconsolidated 
  partnership's loss | 2001 
$   (845) | 2000 
$ (1,081)

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AZTAR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

Note 3:  Long-term Debt
Long-term debt consists of the following (in thousands):

|8 7/8% Senior Subordinated Notes Due 2007
9% Senior Subordinated Notes Due 2011
Revolving credit facility ("Revolver");
    floating rate; matures June 30, 2005
Term loan ("Term Loan"); floating rate,
    6.2% at September 27, 2001; matures
    June 30, 2005
Other notes payable; 14.6%; maturities
    to 2002
Obligations under capital leases
Less current portion | September 27,2001
$235,000   
175,000   
--   
49,000   
217   1,178   
460,395   (1,353)  
$ 459,042   
========= | December 28,2000
$235,000  
--  
178,000  
49,375  
422  1,822  
464,619  (1,608) 
$463,011  
========
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------

On June 29, 2001, the Company amended its Revolver to, among other things, extend the maturity to June 30, 2005 from June 30, 2003.  In addition, the amendment revised the reduction rate so that the maximum amount available under the Revolver decreases by $12 million on March 31, 2004, and quarterly thereafter.  The amount available under this facility at September 27, 2001 was $264 million.
On July 27, 2001, the Company issued $175 million principal amount of 9% Senior Subordinated Notes due August 15, 2011 ("9% Notes"). Interest is payable on February 15 and August 15, beginning on February 15, 2002.  The net proceeds from the issuance of the 9% Notes, after payment of the fees and expenses of the issuance, were approximately $171.2 million.  The balance of the net proceeds of the 9% Notes was used to repay the outstanding borrowings under the Revolver and for general corporate purposes.
At any time prior to August 15, 2006, the 9% Notes are redeemable at the option of the Company, in whole or in part, at a price of 100% of the principal amount plus a redemption premium plus accrued and unpaid interest.  The redemption premium will be equal to the greater of (1) 1% of the principal amount or (2) the excess of (A) the sum of the present values of (i) 104.5% of the principal amount and (ii) all required interest payments through August 15, 2006, excluding accrued but unpaid interest, computed in each case using a discount rate equal to the treasury rate at the time of redemption plus 50 basis points over (B) the principal amount.  On or after August 15, 2006, the 9% Notes are redeemable at the option of the Company, in whole or in part, at prices from 104.5% of the principal amount plus interest declining to 100% of the principal amount plus interest beginning August 15, 2009.
The 9% Notes, ranked pari passu with the 8 7/8% Notes, are general unsecured obligations of the Company and are subordinated in right of payment to all present and future senior indebtedness (as defined) of the Company.  Upon change of control of the Company, the holders of the 9% Notes would have the right to require repurchase of the notes at 101% of the principal amount plus accrued and unpaid interest.  Certain covenants in the 9% Notes limit the ability of the Company to incur indebtedness or engage in mergers, consolidations or sales of assets.

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AZTAR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

Note 4:  Other Long-term Liabilities
Other long-term liabilities consist of the following (in thousands):

|Deferred compensation and retirement plans
Accrued rent expense
Obligation to City of Evansville and other
    civic and community organizations
Las Vegas Boulevard beautification
    assessment
Less current portion | September 27,2001
$ 13,239   
7,915   
--   375   
21,529   (1,498)  
$ 20,031   
======== | December 28,2000
$ 12,732  
8,668  
50  401  
21,851  (1,544) 
$ 20,307  
========
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------

Note 5:  Income Taxes
The Company is responsible, with certain exceptions, for the taxes of Ramada Inc. ("Ramada") through December 20, 1989.  In connection with Internal Revenue Service ("IRS") examinations of the income tax returns for the years 1989 through 1996, an issue was resolved, which was the last remaining issue for the years 1989 through 1991, that resulted in an income tax benefit of approximately $7,500,000 in the 2000 second quarter.  The issue related to the deductibility of the cost of meals served to certain employees on the Company's premises.  The IRS maintained that the Tax Reform Act of 1986 reduced this deduction.  We recorded provisions in prior years based on the IRS position; however, we believed that these employee meals were fully deductible.  The United States Tax Court decided in favor of the IRS in a case involving Boyd Gaming Corporation ("Boyd Gaming Case").  In 1999, the Boyd Gaming Case was overturned in the United States Court of Appeals.  This issue, as it pertained to us, was resolved with the IRS during the 2000 second quarter.
The Internal Revenue Service is currently examining the income tax returns for the years 1992 through 1999.  The New Jersey Division of Taxation is examining the New Jersey income tax returns for the years 1995 through 1998.  Management believes that adequate provision for income taxes and interest has been made in the financial statements.
The Indiana Department of Revenue ("IDR") is currently examining the income tax returns for the years 1998 through 2000.  The Company has received proposed assessments from the IDR in connection with the examination of the Company's Indiana income tax returns for the years 1996 and 1997.  Those assessments are based on the IDR's position that the Company's gaming taxes that are based on gaming revenue are not deductible for Indiana income tax purposes.  The Company believes that it has meritorious legal defense to those assessments and has not recorded an accrual for payment.  The amount involved, including the Company's estimate of interest, net of a federal income tax benefit assuming continuation through September 27, 2001, was approximately $7,400,000 at September 27, 2001.

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AZTAR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

Note 6:  Earnings Per Share
Net income per common share excludes dilution and is computed by dividing income applicable to common shareholders by the weighted-average number of common shares outstanding.  Net income per common share, assuming dilution, is computed based on the weighted-average number of common shares outstanding after consideration of the dilutive effect of stock options and the assumed conversion of the preferred stock at the stated rate.  
The computations of net income per common share and net income per common share, assuming dilution, for the periods ended September 27, 2001 and September 28, 2000, are as follows (in thousands, except per share data):

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | Third Quarter                                                                                                                           | Nine Months                                                                                                                           
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------
|Net income 
Less: preferred stock dividends
  and losses on redemption 
Income available to common 
  shareholders
Plus: income impact of assumed
  conversion of dilutive preferred
  stock
Income available to common
  shareholders plus dilutive
  potential common shares
Weighted-average common shares
  applicable to net income per
  common share
Effect of dilutive securities:
  Stock option incremental shares
  Assumed conversion of preferred
  stock
Dilutive potential common shares
Weighted-average common shares
  applicable to net income per
  common share assuming dilution
Net income per common share
Net income per common share
  assuming dilution | 2001 
$ 17,825 (191)
 17,634 121 
$ 17,755 
======== 
37,223 
1,014 642 1,656 
38,879 
======== 
$    .47 
======== 
$    .46 
======== | 2000 
$ 14,552 (200)
 14,352 -- 
$ 14,352 
======== 
40,428 
1,266 703 1,969 
42,397 
======== 
$    .35 
======== 
$    .34 
========

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AZTAR CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

Note 7:  Contingencies and Commitments
The Company agreed to indemnify Ramada against all monetary judgments in lawsuits pending against Ramada and its subsidiaries as of the conclusion of the restructuring of Ramada (the "Restructuring") on December 20, 1989, as well as all related attorneys' fees and expenses not paid at that time, except for any judgments, fees or expenses accrued on the hotel business balance sheet and except for any unaccrued and unreserved aggregate amount up to $5,000,000 of judgments, fees or expenses related exclusively to the hotel business.  Aztar is entitled to the benefit of any crossclaims or counterclaims related to such lawsuits and of any insurance proceeds received.  In addition, the Company agreed to indemnify Ramada for various lease guarantees made by Ramada relating to the restaurant business.  In connection with these matters, the Company's accrued liability was $3,833,000 at both September 27, 2001 and December 28, 2000.
The Company is a party to various other claims, legal actions and complaints arising in the ordinary course of business or asserted by way of defense or counterclaim in actions filed by the Company.  Management believes that its defenses are substantial in each of these matters and that the Company's legal posture can be successfully defended without material adverse effect on its consolidated financial position, results of operations or cash flows.
The Tropicana Las Vegas lease agreement contains a provision that requires the Company to maintain an additional security deposit with the lessor of $21,996,000 in cash or a letter of credit if the Tropicana Las Vegas operation fails to meet certain financial tests.  The Company has a 50% partnership interest in the lessor.
The Company has severance agreements with certain of its senior executives. Severance benefits range from a lump-sum cash payment equal to three times the sum of the executive's annual base salary and the average of the executive's annual bonuses awarded in the preceding three years plus payment of the value in the executive's outstanding stock options and vesting and distribution of any restricted stock to a lump-sum cash payment equal to the executive's annual base salary.  In certain agreements, the termination must be as a result of a change in control of the Company.  Based upon salary levels and stock options at September 27, 2001, the aggregate commitment under the severance agreements should all these executives be terminated was approximately $24,000,000 at September 27, 2001.
Item 2. Management's Discussion and Analysis
Financial Condition
On June 29, 2001, we amended our Revolver to extend the maturity to June 30, 2005 from June 30, 2003.  In addition, the amendment revised the reduction rate so that the maximum amount available under the Revolver decreases by $12 million on March 31, 2004, and quarterly thereafter.  The amount available under this facility at September 27, 2001 was $264 million.
On June 29, 2001, the maturity date of a $52 million term loan among Tropicana Enterprises and a group of banks was extended to June 30, 2005 from June 30, 2003.  At September 27, 2001, the balance of this term loan was $51 million.  We have a noncontrolling partnership interest of 50% in Tropicana Enterprises, a Nevada general partnership that owns the real property and certain personal property that we lease in the operation of the Tropicana Las Vegas.

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AZTAR CORPORATION AND SUBSIDIARIES

On July 27, 2001, we issued $175 million principal amount of 9% Senior Subordinated Notes due August 15, 2011 ("9% Notes").  Interest is payable on February 15 and August 15, beginning on February 15, 2002.  The net proceeds from the issuance of the 9% Notes, after payment of the fees and expenses of the issuance, were approximately $171.2 million.  The balance of the net proceeds of the 9% Notes was used to repay the outstanding borrowings under the Revolver and for general corporate purposes.
During the 2001 nine-month period, we repurchased 2,031,000 shares of common stock at prices ranging from $9.00 per share to $16.10 per share and at an average price of $12.13 per share.  Subsequent to the end of the third quarter, we also repurchased 303,700 shares, which was the balance remaining to be repurchased under a program authorized by our Board of Directors.  From the beginning of the share repurchase program in May 1999 through its completion, we repurchased 11.0 million shares at prices ranging from $6.69 per share to $16.10 per share and at an average price of $11.64 per share.  Purchases under our stock repurchase program were made from time to time in the open market or privately negotiated transactions, depending on market prices and other business factors.
We are working on a plan to expand our Atlantic City Tropicana.  We expect to commence construction in May 2002, with opening contemplated for March 2004. We are targeting a project cost for the expansion of $225 million, against which we hope to realize third-party contributions, public sector subsidies, tax rebates and other credits, the present value of which could reduce the cost by up to $50 million.
Results of Operations
Nine Months Ended September 27, 2001 Compared to Nine Months Ended September 27, 2000
Our consolidated revenues in the 2001 nine-month period were $637.3 million, a 3% decrease over $654.7 million in the 2000 nine-month period.  The decrease in revenues was primarily related to a $16.8 million or 3% decrease in casino revenue, with a substantial portion of the decrease coming from Tropicana Atlantic City and Casino Aztar Evansville.  Consolidated rooms revenue was $2.5 million or 4% higher in the 2001 versus 2000 nine-month period, reflecting increases at all hotel properties except for Casino Aztar Evansville, which had a slight decrease. Consolidated other revenue consists of entertainment, retail and other revenue and was $29.4 million in the 2001 nine-month period compared with $31.2 million in the 2000 nine-month period.  The related direct costs were $24.5 million in the 2001 nine-month period versus $25.6 million in the 2000 nine-month period.  Consolidated operating income was $101.1 million in the 2001 nine-month period, a 5% improvement over $96.6 million in the 2000 nine-month period.  Consistent with the decrease in consolidated casino revenue, consolidated casino costs were $12.5 million or 6% lower in the 2001 versus 2000 nine-month period, largely due to a decrease in casino costs at Tropicana Atlantic City and Casino Aztar Evansville.  Consolidated marketing costs were $7.4 million or 11% lower in the 2001 versus 2000 nine-month period primarily due to reduced spending on promotional programs, advertising and contract entertainment at Tropicana Atlantic City, combined with decreased spending on promotional programs and advertising at Casino Aztar Evansville.  Consolidated utilities expense was $1.8 million or 16% higher in the 2001 nine-month period compared to the 2000 nine-month period primarily due to rising energy prices affecting all properties. Consolidated rent expense was $1.2 million or 9% higher in the 2001 versus 2000 nine-month period primarily due to increased rent to the City of Evansville relating to our riverboat landing lease.  A scheduled change in the formula used in calculating the rent came into effect in December 2000.
Consolidated interest expense was 9% or $3.0 million lower in the 2001 versus 2000 nine-month period primarily as a result of lower levels of debt outstanding combined with lower interest rates.  In addition, capitalized interest relating to the Tropicana Atlantic City expansion for the 2001 nine-month period reduced consolidated interest expense by $0.8 million.  There was no capitalized interest for the 2000 nine-month period.

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AZTAR CORPORATION AND SUBSIDIARIES

The Company is responsible, with certain exceptions, for the taxes of Ramada through December 20, 1989.  In connection with IRS examinations of the income tax returns for the years 1989 through 1996, an issue was resolved, which was the last remaining issue for the years 1989 through 1991, that resulted in an income tax benefit of approximately $7.5 million in the 2000 second quarter.  The issue related to the deductibility of the cost of meals served to certain employees on the Company's premises.  The IRS maintained that the Tax Reform Act of 1986 reduced this deduction.  We recorded provisions in prior years based on the IRS position; however, we believed that these employee meals were fully deductible.  The United States Tax Court decided in favor of the IRS in a case involving Boyd Gaming Corporation.  In 1999, the Boyd Gaming case was overturned in the United States Court of Appeals.  This issue, as it pertained to us, was resolved with the IRS during the 2000 second quarter.
The Indiana Department of Revenue is currently examining the income tax returns for the years 1998 through 2000.  The Company has received proposed assessments from the IDR in connection with the examination of the Company's Indiana income tax returns for the years 1996 and 1997.  Those assessments are based on the IDR's position that the Company's gaming taxes that are based on gaming revenue are not deductible for Indiana income tax purposes.  The Company believes that it has meritorious legal defense to those assessments and has not recorded an accrual for payment.  The amount involved, including the Company's estimate of interest, net of a federal income tax benefit assuming continuation through September 27, 2001, was approximately $7,400,000 at September 27, 2001.
TROPICANA ATLANTIC CITY  Total revenues at Tropicana Atlantic City were $348.8 million in the 2001 nine-month period, down 3% from $358.6 million in the 2000 nine-month period. Decreased spending on promotional giveaways as well as harsh winter weather during our 2001 first quarter, particularly a major storm over the New Year's Eve weekend which fell in our fiscal first quarter, contributed to the decline in Tropicana Atlantic City's revenues for the nine months ended 2001.  Casino revenue was 3% lower in the 2001 versus 2000 nine-month period, primarily reflecting a 3% decrease in games revenue combined with a 3% decrease in slots revenue.  The decline in games revenue was a result of a decrease in the volume of play.  Rooms revenue was $1.3 million or 8% higher in the 2001 versus 2000 nine-month period, primarily as a result of an increase in the average daily rates and an increase in the rooms occupied on a noncomplimentary basis.  
Tropicana Atlantic City had operating income of $73.2 million in the 2001 nine-month period, a 7% improvement over $68.3 million in the 2000 nine-month period. Consistent with the decrease in casino revenue, casino costs were 7% lower in the 2001 versus 2000 nine-month period.  Contributing to the decline in casino costs was a 22% reduction in coin offers to slot players in the 2001 versus 2000 nine-month period.  Marketing costs were 9% lower in the 2001 versus 2000 nine-month period primarily due to reduced spending on promotional programs, advertising and contract entertainment. Operating income is after rent and depreciation and amortization expenses.  Rent expense was $1.9 million in the 2001 nine-month period compared to $1.8 million in the 2000 nine-month period.  Depreciation and amortization was $19.7 million in the nine months ended 2001 compared to $19.5 million in the nine months ended 2000.
TROPICANA LAS VEGAS  At Tropicana Las Vegas, total revenues were $118.5 million in the 2001 nine-month period, a slight increase from $117.3 million in the 2000 nine-month period.  Tropicana Las Vegas had operating income of $8.3 million in the 2001 nine-month period, a 20% improvement over $6.9 million in the 2000 nine-month period. Utilities expense was 43% higher in the 2001 versus 2000 nine-month period primarily due to rising energy prices.  Operating income is after rent and depreciation and amortization expenses.  Rent expense was $7.1 million in the 2001 nine-month period compared to $7.6 million in the 2000 nine-month period. Depreciation and amortization was $5.8 million in the 2001 nine-month period compared to $7.2 million in the 2000 nine-month period.

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RAMADA EXPRESS  At Ramada Express, total revenues were $72.2 million in the 2001 nine-month period, down 4% from $75.3 million in the 2000 nine-month period.  Utilities expense was 36% higher in the 2001 versus 2000 nine-month period primarily due to rising energy prices.  Operating income was $13.4 million in the 2001 nine-month period compared to $13.6 million in the 2000 nine-month period. Operating income is after rent and depreciation and amortization expenses.  Rent expense was $0.3 million in the nine months ended 2001 compared to $0.5 million in the nine months ended 2000.  Depreciation and amortization was $4.3 million in the 2001 nine-month period compared to $4.0 million in the 2000 nine-month period.
CASINO AZTAR EVANSVILLE  Total revenues at Casino Aztar Evansville were $78.8 million in the 2001 nine-month period, down 7% from $84.5 million in the 2000 nine-month period. Casino revenue was 6% lower in the 2001 versus 2000 nine-month period, primarily reflecting a 12% decrease in games revenue combined with a 5% decrease in slot revenue.  The decrease in games revenue was a result of a decrease in the volume of play.  Consistent with the decrease in casino revenue, casino costs were 8% lower in the 2001 versus 2000 nine-month period.  Casino costs were lower due to a lower wagering tax that is based on revenue and reduced costs of complimentaries. Marketing costs were 21% lower in the 2001 versus 2000 nine-month period due to decreased spending on promotional programs and advertising.  Operating income was $14.8 million in the 2001 nine-month period, an 11% decrease from $16.7 million in the 2000 nine-month period. Operating income is after rent and depreciation and amortization expenses.  Rent expense was $4.4 million in the 2001 nine-month period compared to $2.6 million in the 2000 nine-month period.  Rent expense increased in the 2001 versus 2000 nine-month period primarily due to increased rent to the City of Evansville relating to our riverboat landing lease.  A scheduled change in the formula used in calculating the rent came into effect in December 2000.  Depreciation and amortization was $6.8 million in the 2001 nine-month period compared to $7.6 million in the 2000 nine-month period.
CASINO AZTAR CARUTHERSVILLE   Total revenues at Casino Aztar Caruthersville were $19.0 million in both periods.  Casino Aztar Caruthersville had operating income of $1.1 million in the 2001 nine-month period, an improvement over $0.3 million in the 2000 nine-month period.  Operating income is after depreciation and amortization of $2.2 million in the nine months ended 2001 compared to $2.3 million in the nine months ended 2000. 
Quarter Ended September 27, 2001 Compared to Quarter Ended September 28, 2000
Our consolidated revenues in the 2001 third quarter were $218.1 million, a 2% decrease over $222.2 million in the 2000 third quarter.  The decrease in revenues was primarily related to a decrease in casino revenue, with a substantial portion of the decrease coming from Casino Aztar Evansville.  Consolidated operating income was $37.3 million in the third quarter of 2001, a 10% improvement over $33.8 million in the third quarter of 2000.  Consolidated casino costs decreased by $5.3 million or 7% in the 2001 versus 2000 third quarter.  Contributing to the decrease in casino costs was a reduction in coin offers to slot players at Tropicana Atlantic City.  In addition, casino costs were lower at Casino Aztar Evansville consistent with the decrease in casino revenue.
TROPICANA ATLANTIC CITY  Total revenues at Tropicana Atlantic City were $125.9 million in the 2001 third quarter, down slightly from $126.6 million in the 2000 third quarter. Casino revenue was $112.4 million for both periods.  In the 2001 versus 2000 third quarter, slot revenue decreased by 4% while games revenue increased by 11%.  Games revenue increased as a result of a higher hold percentage. The table games hold percentage was 17.6% in the 2001 third quarter compared with 14.7% in the 2000 third quarter.

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Tropicana Atlantic City had operating income of $31.3 million in the 2001 third quarter, a 15% improvement over $27.2 million in the 2000 third quarter.  Casino costs were 10% lower in the 2001 versus 2000 third quarter.  Contributing to the decrease in casino costs was a 33% reduction in coin offers to slot players in the 2001 versus 2000 third quarter.  Operating income is after rent and depreciation and amortization expenses.  Rent expense was $0.6 million in the 2001 third quarter compared to $0.7 million in the 2000 third quarter.  Depreciation and amortization was $6.6 million in the third quarter of 2001 compared to $6.4 million in the third quarter of last year.
TROPICANA LAS VEGAS  At Tropicana Las Vegas, total revenues were $37.8 million in the 2001 third quarter, down slightly from $38.3 million in the 2000 third quarter. Utilities expense was 22% higher in the 2001 versus 2000 third quarter, primarily due to rising energy prices.  Operating income was $1.4 million in the third quarter of 2001 compared to $2.1 million in the third quarter of 2000. Operating income is after rent and depreciation and amortization expenses.  Rent expense was $2.3 million in the 2001 third quarter compared to $2.5 million in the 2000 third quarter. Depreciation and amortization was $1.9 million in the third quarter of 2001 compared to $2.4 million in the third quarter of 2000.
RAMADA EXPRESS  At Ramada Express, total revenues were $21.7 million in the 2001 third quarter, down 3% from $22.4 million in the 2000 third quarter.  Utilities expense was 24% higher in the 2001 versus 2000 third quarter primarily due to rising energy prices.  Operating income was $2.3 million in both periods.  Operating income is after rent and depreciation and amortization expenses.  Rent expense was $0.1 million in both periods.  Depreciation and amortization was $1.4 million in both periods.
CASINO AZTAR EVANSVILLE  Total revenues at Casino Aztar Evansville were $26.5 million in the 2001 third quarter, down 8% from $28.8 million in the 2000 third quarter. Casino revenue was 7% lower in the 2001 versus 2000 third quarter, primarily reflecting a 12% decrease in games revenue combined with a 6% decrease in slot revenue.  The decrease in games revenue was primarily a result of a decrease in the volume of play.  Operating income was $4.9 million in the 2001 third quarter, an 8% decrease from $5.3 million in the 2000 third quarter. Consistent with the decrease in casino revenue, casino costs were 7% lower in the 2001 versus 2000 third quarter.  Operating income is after rent and depreciation and amortization expenses. Rent expense was $1.2 million in the 2001 third quarter compared to $1.1 million in the 2000 third quarter.  Rent expense increased in the 2001 versus 2000 third quarter primarily due to increased rent to the City of Evansville relating to our riverboat landing lease.  A scheduled change in the formula used in calculating the rent came into effect in December 2000.  Casino revenue is a component used in the calculation of rent expense.  During the 2001 third quarter, as a result of lower than anticipated casino revenue since December 2000, we revised our estimate of rent expense and recorded a $0.3 million reduction in rent.  Depreciation and amortization was $2.3 million in the 2001 third quarter compared to $2.6 million in last year's third quarter.
CASINO AZTAR CARUTHERSVILLE   Total revenues at Casino Aztar Caruthersville were $6.2 million in the 2001 third quarter, a 2% increase from $6.1 million in the 2000 third quarter.  Casino Aztar Caruthersville had operating income of $0.3 million in the third quarter of 2001 compared to an operating income that was at break-even for the third quarter of 2000.  Operating income is after depreciation and amortization of $0.7 million in both periods.

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Impact of Recent Events
The September terrorist attacks as well as the ensuing economic conditions have resulted in an increased level of uncertainty with regard to our near term operating results.  Since the end of our third quarter through the end of our fiscal month of October, these developments have had a modest impact on our consolidated operating and financial results.  We are unable to predict any future effects.
Recent Accounting Pronouncements
In July 2001, the Financial Accounting Standards Board issued Statement No. 141, "Business Combinations" and Statement No. 142, "Goodwill and Other Intangible Assets."  SFAS 141 is effective as follows: (a) use of the pooling-of-interests method is prohibited for business combinations initiated after June 30, 2001; and (b) the provisions of SFAS 141 also apply to all business combinations accounted for by the purchase method that are completed after June 30, 2001.  There are also transition provisions that apply to business combinations completed before July 1, 2001 that were accounted for by the purchase method.  SFAS 142 is effective for fiscal years beginning after December 15, 2001 and applies to all goodwill and other intangible assets recognized in an entity's statement of financial position at that date, regardless of when those assets were initially recognized.
In August 2001, the Financial Accounting Standards Board issued Statement No. 143, "Accounting for Obligations Associated with the Retirement of Long-Lived Assets."  The objectives of SFAS 143 are to establish accounting standards for the recognition and measurement of an asset retirement obligation and its associated asset retirement cost.  SFAS 143 is effective for fiscal years beginning after June 15, 2002.
In October 2001, the Financial Accounting Standards Board issued statement No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets."  SFAS 144 addresses financial accounting and reporting for the impairment or disposal of long-lived assets.  SFAS 144 is effective for fiscal years beginning after December 15, 2001 and, generally, is to be applied prospectively.
The Company is currently evaluating the provisions of SFAS 141, SFAS 142, SFAS 143 and SFAS 144 and has not yet determined the effects of these changes on the Company's financial position or results of operations.
Private Securities Litigation Reform Act
Certain information included in Aztar's Form 10-K for the year ended December 28, 2000, this Form 10-Q and other materials filed or to be filed by us with the Securities and Exchange Commission (as well as information included in oral statements or other written statements made or to be made by us including those made in Aztar's 2000 annual report) contains statements that are forward-looking.  These include forward-looking statements relating to the following activities, among others: operation and expansion of existing properties, including future performance; redevelopment of the Las Vegas Tropicana and financing and/or concluding an arrangement with a partner for such redevelopment; other business development activities; uses of free cash flow; stock repurchases; debt repayments; and use of derivatives.  These forward-looking statements generally can be identified by phrases such as we "believe," "expect," "anticipate," "foresee," "forecast," "estimate," "target," or other words or phrases of similar import.  Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals are also forward-looking statements. Such forward-looking information involves important risks and uncertainties that could significantly affect results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by us or on our behalf. These risks and uncertainties include, but are not limited to, the following factors as well as other factors described from time to time in Aztar's reports filed with

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the SEC: those factors relating to terrorist activities, construction and development factors, including zoning issues, environmental restrictions, soil conditions, weather and other hazards, site access matters and building permit issues; factors affecting leverage and debt service, including sensitivity to fluctuation in interest rates; access to available and feasible financing; regulatory and licensing matters; third-party consents, approvals and representations, and relations with partners, owners, suppliers and other third parties; reliance on key personnel; business and economic conditions; the cyclical nature of the hotel business and the gaming business; the effects of weather; market prices of our common stock; litigation, judicial actions and political uncertainties, including gaming legislation and taxation; and the effects of competition, including locations of competitors and operating and marketing competition.  Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
For a discussion of information that affects information incorporated by reference in Item 7A of the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 2000, see "Note 3: Long-term Debt" of the Notes to Consolidated Financial Statements included in this Form 10-Q under Item 1.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

|(a) | In connection with Case No. CV-S-94-1126-DAE(RJJ)-BASE FILE (the "Poulos/Ahearn Case"), Case No. CV-S-95-00923-DWH(RJJ) (the "Schreier Case") and Case No. CV-S-95-936-LDG(RLH) (the "Cruise Ship Case"), (collectively, the "Consolidated Cases"), as reported under Part I, Item 3 of the Company's Form 10-K for the year ended December 28, 2000, the defendants have filed a supplement to their memorandum in opposition to class certification and the plaintiffs have filed their reply.  The hearing on the motion for class certification has been scheduled for November 15, 2001.
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Item 6. Exhibits and Reports on Form 8-K

|(a) | Exhibits           
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|(b) | Reports on Form 8-K
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AZTAR CORPORATION AND SUBSIDIARIES
SIGNATURES

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



|Date November 8, 2001 | AZTAR CORPORATION
          (Registrant)          
By ROBERT M. HADDOCK
    Robert M. Haddock
    Executive Vice President and
    Chief Financial Officer
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