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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q

|  |  |                                                                                  
|- |  | ---------------------------------------------------------------------------------
|x |  | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|  |  |                                                                                  
|  |  | For the quarterly period ended March 31, 2003                                    

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 333-0214

HORSESHOE GAMING HOLDING CORP.

(Exact name of registrant as specified in its charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 88-0425131                          
|                                                               |  |                                     
|(State or other jurisdiction
of incorporation or organization) |  | (I.R.S. Employer Identification No.)

|                                              |  |  |  |           
|--------------------------------------------- |  |  |  | ----------
|18454 South West Creek Drive, Tinley Park, IL |  |  |  | 60477     
|                                              |  |  |  |           
|(Address of principal executive office)       |  |  |  | (ZIP CODE)

(708) 429-8300

(Registrants telephone number, including area code)




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


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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.).

Yes    o    No    x

As of May 9, 2003, the registrant had 13,298 shares of Class A Common Stock and
9,779 of Class B Common Stock outstanding.





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TABLE OF CONTENTS



|                                                                                              |                                                      |  |  |  |  |  |  | 
|--------------------------------------------------------------------------------------------- | ---------------------------------------------------- |  |  |  |  |  |  | 
|PART I FINANCIAL INFORMATION                                                                 
|Item 1. FINANCIAL STATEMENTS                                                                 
|                                                                                              | CONSOLIDATED CONDENSED BALANCE SHEETS               
|                                                                                              | CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS     
|                                                                                              | CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS     
|                                                                                              | NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
|Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|Item 3. Quantitative and Qualitative Disclosure About Market Risk                            
|Item 4. Controls and Procedures                                                              
|PART II OTHER INFORMATION                                                                    
|Item 6. EXHIBITS AND REPORTS ON FORM 8-K                                                     
|SIGNATURE                                                                                    
|CERTIFICATION                                                                                
|EXHIBIT INDEX                                                                                
|EXHIBIT 99.1                                                                                 
|EXHIBIT 99.2                                                                                 



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##### Table of Contents



HORSESHOE GAMING HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

|                                                                                                      |                                                                                                    |  |    |   | 
|----------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------- |  | -- | - | 
|PART I        FINANCIAL INFORMATION                                                                  
|Item 1.         Financial Statements                                                                  |                                                                                                    |  |    |  
|                                                                                                      | Consolidated Condensed Balance Sheets as of
March 31, 2003 and December 31, 2002                   |  |    | 3 | 
|                                                                                                      | Consolidated Condensed Statements of Operations for the
three months ended March 31, 2003 and 2002 |  |    | 4 | 
|                                                                                                      | Consolidated Condensed Statements of Cash Flows for the
three months ended March 31, 2003 and 2002 |  |    | 5 | 
|                                                                                                      | Notes to Consolidated Condensed Financial Statements                                               |  |    | 6 | 
|Item 2.         Managements Discussion and Analysis of Financial Condition
and Results of Operations |                                                                                                    |  | 8  |  
|Item 3.        Quantitative and Qualitative Disclosures About Market Risk                             |                                                                                                    |  | 12 |  
|Item 4.        Controls and Procedures                                                                |                                                                                                    |  | 12 |  
|PART II      OTHER INFORMATION                                                                        |                                                                                                    |  |    |  
|Item 6.        Exhibits and Reports on Form 8-K                                                       |                                                                                                    |  | 13 |  
|SIGNATURE                                                                                             |                                                                                                    |  | 14 |  
|Certification  Kirk C. Saylor, Chief Financial Officer                                               |                                                                                                    |  | 15 |  
|Certification  Jack B. Binion, Chief Executive Officer                                               |                                                                                                    |  | 16 |  

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##### Table of Contents






PART I                     FINANCIAL INFORMATION




Item 1.                     FINANCIAL STATEMENTS





HORSESHOE GAMING HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(unaudited)
(in thousands, except for share data)

|                              |                                                                                                         |                             |                                      |         |         |           |         |              |         |  |  | 
|----------------------------- | ------------------------------------------------------------------------------------------------------- | --------------------------- | ------------------------------------ | ------- | ------- | --------- | ------- | ------------ | ------- |  |  | 
|                              |                                                                                                         |                             |                                      |         |         | March 31, |         | December 31,
|                              |                                                                                                         |                             |                                      |         |         | 2003      |         | 2002        
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         |                             |                                      | ASSETS  |         |           |         |              |         |  |  | 
|Current assets                |                                                                                                         |                             |                                      |         |         |           |         |             
|                              | Cash and cash equivalents                                                                               |                             | $                                    | 85,119  |         |           | $       | 87,373       |        
|                              | Restricted cash                                                                                         |                             |                                      | 14,319  |         |           |         | 14,286       |        
|                              | Accounts receivable, net of allowance for doubtful
accounts of $6,738 and $6,779, respectively          |                             |                                      | 13,027  |         |           |         | 12,555       |        
|                              | Inventories                                                                                             |                             |                                      | 5,041   |         |           |         | 5,418        |        
|                              | Prepaid expenses and other                                                                              |                             |                                      | 13,224  |         |           |         | 7,825        |        
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | Total current assets        |                                      |         | 130,730 |           |         |              | 127,457 | 
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|Property and equipment, net   |                                                                                                         |                             | 467,501                              |         |         |           | 471,003 |             
|Goodwill                      |                                                                                                         |                             | 252,242                              |         |         |           | 252,242 |             
|Intangibles, net              |                                                                                                         |                             | 11,710                               |         |         |           | 12,970  |             
|Other, net                    |                                                                                                         |                             | 37,357                               |         |         |           | 37,887  |             
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | $                           | 899,540                              |         |         | $         | 901,559 |             
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         |                             | LIABILITIES AND STOCKHOLDERS EQUITY |         |         |           |         |              |         |  | 
|Current liabilities           |                                                                                                         |                             |                                      |         |         |           |         |             
|                              | Accounts payable                                                                                        |                             | $                                    | 10,487  |         |           | $       | 8,860        |        
|                              | Accrued expenses and other                                                                              |                             |                                      | 94,957  |         |           |         | 99,492       |        
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | Total current liabilities   |                                      |         | 105,444 |           |         |              | 108,352 | 
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|Long-term liabilities         |                                                                                                         |                             |                                      |         |         |           |         |             
|                              | Long-term debt                                                                                          |                             |                                      | 543,822 |         |           |         | 556,773      |        
|                              | Other long-term liabilities                                                                             |                             |                                      | 6,682   |         |           |         | 6,923        |        
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | Total long-term liabilities |                                      |         | 550,504 |           |         |              | 563,696 | 
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|Commitments and contingencies |                                                                                                         |                             |                                      |         |         |           |         |             
|Stockholders equity          |                                                                                                         |                             |                                      |         |         |           |         |             
|                              | Common stock, $.01 par value, 50,000 shares authorized, 25,000
shares issued, 23,077 shares outstanding |                             |                                      |        |         |           |         |             |        
|                              | Additional paid-in capital                                                                              |                             |                                      | 59,808  |         |           |         | 59,808       |        
|                              | Retained earnings                                                                                       |                             |                                      | 239,082 |         |           |         | 225,001      |        
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         |                             | 298,890                              |         |         |           | 284,809 |             
|                              | Treasury stock, at cost, 1,923 shares                                                                   |                             |                                      | (55,298 | )       |           |         | (55,298      | )      
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | Total stockholders equity  |                                      |         | 243,592 |           |         |              | 229,511 | 
|                              |                                                                                                         |                             |                                      |         |         |           |         |             
|                              |                                                                                                         | $                           | 899,540                              |         |         | $         | 901,559 |             
|                              |                                                                                                         |                             |                                      |         |         |           |         |             

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

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HORSESHOE GAMING HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31
(unaudited)
(in thousands)

|                       |                                  |                              |         |         |         |      |         |         |         |  
|---------------------- | -------------------------------- | ---------------------------- | ------- | ------- | ------- | ---- | ------- | ------- | ------- | -
|                       |                                  |                              |         | 2003    |         | 2002
|                       |                                  |                              |         |         |         |     
|Revenues               |                                  |                              |         |         |         |      |         |        
|                       | Casino                           |                              | $       | 215,221 |         |      | $       | 207,933 |        
|                       | Food and beverage                |                              |         | 20,427  |         |      |         | 20,530  |        
|                       | Hotel                            |                              |         | 7,420   |         |      |         | 7,136   |        
|                       | Retail and other                 |                              |         | 4,290   |         |      |         | 4,764   |        
|                       |                                  |                              |         |         |         |      |         |        
|                       |                                  |                              | 247,358 |         |         |      | 240,363 |        
|                       | Promotional allowances and other |                              |         | (37,257 | )       |      |         | (35,419 | )      
|                       |                                  |                              |         |         |         |      |         |        
|                       |                                  | Net revenues                 |         |         | 210,101 |      |         |         | 204,944 |  
|                       |                                  |                              |         |         |         |      |         |        
|Expenses               |                                  |                              |         |         |         |      |         |        
|                       | Casino                           |                              |         | 119,228 |         |      |         | 103,567 |        
|                       | Food and beverage                |                              |         | 6,261   |         |      |         | 5,902   |        
|                       | Hotel                            |                              |         | 495     |         |      |         | 621     |        
|                       | Retail and other                 |                              |         | 1,245   |         |      |         | 1,862   |        
|                       | General and administrative       |                              |         | 28,287  |         |      |         | 26,319  |        
|                       | Corporate expenses               |                              |         | 5,498   |         |      |         | 4,855   |        
|                       | Deferred compensation            |                              |         | (199    | )       |      |         | 3,116   |        
|                       | Net loss on disposal of assets   |                              |         | 71      |         |      |         | 1,294   |        
|                       | Depreciation and amortization    |                              |         | 13,379  |         |      |         | 13,893  |        
|                       |                                  |                              |         |         |         |      |         |        
|                       |                                  | Total expenses               |         |         | 174,265 |      |         |         | 161,429 |  
|                       |                                  |                              |         |         |         |      |         |        
|Operating income       |                                  |                              | 35,836  |         |         |      | 43,515  |        
|Other income (expense) |                                  |                              |         |         |         |      |         |        
|                       | Interest expense                 |                              |         | (12,748 | )       |      |         | (17,679 | )      
|                       | Interest income                  |                              |         | 178     |         |      |         | 927     |        
|                       | Other, net                       |                              |         |        |         |      |         | (615    | )      
|                       |                                  |                              |         |         |         |      |         |        
|                       |                                  | Total other income (expense) |         |         | (12,570 | )    |         |         | (17,367 | )
|                       |                                  |                              |         |         |         |      |         |        
|Net income             |                                  | $                            | 23,266  |         |         | $    | 26,148  |        
|                       |                                  |                              |         |         |         |      |         |        

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

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HORSESHOE GAMING HOLDING CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31
(unaudited)
(in thousands)

|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |         |   |        |         |  
|---------------------------------------------- | --------------------------------------------------------------------------------- | - | ------------------------------------------------------------------ | ----------------------------------------- | - | ------ | ------- | ------- | - | ------ | ------- | -
|                                               |                                                                                   |   |                                                                    |                                           |   | 2003   |         | 2002   
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Cash flows from operating activities           |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               | Net income                                                                        |   | $                                                                  | 23,266                                    |   |        | $       | 26,148  |  
|                                               | Adjustments to reconcile net income to
net cash provided by operating activities: |   |                                                                    |                                           |   |        |         |         |  
|                                               |                                                                                   |   | Depreciation and amortization                                      |                                           |   | 13,379 |         |         |   | 13,893 |        
|                                               |                                                                                   |   | Net loss on disposal of assets                                     |                                           |   | 71     |         |         |   | 1,294  |        
|                                               |                                                                                   |   | Amortization of debt discounts,
deferred finance charges and other |                                           |   | 678    |         |         |   | 789    |        
|                                               |                                                                                   |   | Provision for doubtful accounts                                    |                                           |   | 598    |         |         |   | 825    |        
|                                               |                                                                                   |   | Deferred compensation                                              |                                           |   | (199   | )       |         |   | 3,116  |        
|                                               |                                                                                   |   | Increase in restricted cash                                        |                                           |   | (33    | )       |         |   |       |        
|                                               |                                                                                   |   | Net change in current assets and current liabilities               |                                           |   | (5,893 | )       |         |   | (527   | )      
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               |                                                                                   |   |                                                                    | Net cash provided by operating activities |   |        | 31,867  |         |   |        | 45,538  |  
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Cash flows from investing activities           |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               | Purchases of property and equipment                                               |   |                                                                    | (8,760                                    | ) |        |         | (10,369 | )
|                                               | Proceeds from sale of property and equipment                                      |   |                                                                    | 101                                       |   |        |         | 90      |  
|                                               | Net increase in other assets                                                      |   |                                                                    | 53                                        |   |        |         | (1,011  | )
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               |                                                                                   |   |                                                                    | Net cash used in investing activities     |   |        | (8,606  | )       |   |        | (11,290 | )
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Cash flows from financing activities           |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               | Repayments on long-term debt                                                      |   |                                                                    | (13,000                                   | ) |        |         | (2,608  | )
|                                               | Capital dividends                                                                 |   |                                                                    | (12,515                                   | ) |        |         |        |  
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               |                                                                                   |   |                                                                    | Net cash used in financing activities     |   |        | (25,515 | )       |   |        | (2,608  | )
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Net change in cash and cash equivalents        |                                                                                   |   | (2,254                                                             | )                                         |   |        | 31,640  |        
|Cash and cash equivalents, beginning of period |                                                                                   |   | 87,373                                                             |                                           |   |        | 220,817 |        
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Cash and cash equivalents, end of period       |                                                                                   | $ | 85,119                                                             |                                           |   | $      | 252,457 |        
|                                               |                                                                                   |   |                                                                    |                                           |   |        |         |        
|Supplemental cash flow disclosure              |                                                                                   |   |                                                                    |                                           |   |        |         |        
|                                               | Interest paid                                                                     |   | $                                                                  | 851                                       |   |        | $       | 735     |  
|                                               | Accrued capital dividends                                                         |   | $                                                                  | 9,185                                     |   |        | $       | 11,811  |  

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

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HORSESHOE GAMING HOLDING CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)

Note 1  Basis of Presentation

The accompanying unaudited consolidated condensed financial statements of
Horseshoe Gaming Holding Corp., a Delaware corporation, and its subsidiaries
(the Company) have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and note disclosures
normally included in annual financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to those rules and regulations. It is suggested that these
consolidated condensed financial statements be read in conjunction with the
financial statements and the notes thereto included in the Companys Form 10-K
for the year ended December 31, 2002. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary to present
fairly the financial position, results of operations and cash flows of all
periods presented have been made. The results of operations for the three
months ended March 31, 2003, are not necessarily indicative of the operating
results for the full year. Certain reclassifications have been made to the
financial statements as previously presented to conform to current
classifications.

Note 2  Recently Issued Accounting Pronouncements

In June 2001, the FASB issued SFAS No. 143 Accounting for Asset
Retirement Obligations (SFAS 143). SFAS 143 requires the recognition of
legal obligations associated with the retirement of long-lived assets that
result from the acquisition, construction, development and/or the normal
operation of the long-lived asset, as well as the disclosure of certain
information related to asset retirement obligations. The Company adopted SFAS
143 in the first quarter of 2003. Adoption of SFAS 143 did not have a material
impact on the Companys results of operations or financial position.

In April 2002, the FASB issued SFAS No. 145 Rescission of FASB Statements
No. 4, 44, and 64, Amendments of FASB Statement No. 13, and Technical
Corrections (SFAS 145). SFAS 145 rescinds SFAS No. 4, Reporting Gains and
Losses from Extinguishment of Debt, and an amendment of that statement, SFAS
No. 64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements.
SFAS 145 also rescinds SFAS No. 44, Accounting for Intangible Assets of Motor
Carriers. SFAS 145 amends SFAS No. 13, Accounting for Leases, to eliminate
an inconsistency between the required accounting for sale-leaseback
transactions and the required accounting for certain lease modifications that
have economic effects that are similar to sale-leaseback transactions. SFAS
145 also amends other existing authoritative pronouncements to make various
technical corrections, clarify meanings, or describe their applicability under
changed conditions. The provisions of this statement related to the
rescission of SFAS No. 4 are effective for fiscal years beginning after May 15,
2002. Any extraordinary losses recognized by the Company will be reclassified
within income from operations to conform to the provisions of SFAS No. 145.
The provisions of this statement related to SFAS No. 13 are effective for
financial statements issued on or after May 15, 2002. The implementation of
these remaining provisions did not have a material effect on the Companys
results of operations or financial position.

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In June 2002, the FASB issued SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities (SFAS 146). SFAS 146 generally
requires companies to recognize costs associated with exit or disposal
activities when they are incurred rather than at the date of a commitment to an
exit or disposal plan, as previously required under EITF Issue 94-3. Examples
of costs covered by the standard include lease termination costs and certain
employee severance costs that are associated with a restructuring, discontinued
operation, plant closing, or other exit or disposal activity. SFAS 146 is to
be applied prospectively to exit or disposal activities initiated after
December 31, 2002. The Company adopted SFAS 146 in the first quarter of 2003.
Adoption of SFAS 146 did not have a material impact on the Companys results of
operations or financial position.

Note 3  Deferred Compensation

The Company recorded deferred compensation of $(0.2) million and $3.1
million for the three months ended March 31, 2003 and 2002, respectively,
related to the (depreciation)/appreciation of vested stock appreciation rights
in the Horseshoe Gaming Holding Corp. Equity Incentive Plan.

Note 4  Intangible Assets, Net

As of March 31, 2003, the Company had the following intangible assets
recorded on its balance sheet (in thousands):

|                        |  |          |        |              |  |         |        |  |  |   |        | 
|----------------------- |  | -------- | ------ | ------------ |  | ------- | ------ |  |  | - | ------ | 
|                        |  | Gross    |        |              |  |         |        |  |  |  
|                        |  | Carrying |        | Accumulated  |  |         |        | 
|                        |  | Amount   |        | Amortization |  | Balance
|                        |  |          |        |              |  |        
|Deferred licensing fees |  | $        | 11,131 |              |  | $       | 3,229  |  |  | $ | 7,902  | 
|Covenant not to compete |  |          | 7,959  |              |  |         | 7,323  |  |  |   | 636    | 
|Other                   |  |          | 5,967  |              |  |         | 2,795  |  |  |   | 3,172  | 
|                        |  |          |        |              |  |         |        |  |  |   |        | 
|                        |  | $        | 25,057 |              |  | $       | 13,347 |  |  | $ | 11,710 | 
|                        |  |          |        |              |  |         |        |  |  |   |        | 

All of the Companys intangible assets are being amortized under the
provisions of SFAS No. 142, Goodwill and Other Intangible Assets.
Amortization expense on intangible assets for the three months ended March 31,
2003 was $1.3 million. Estimated annual amortization expense on intangible
assets for the years ending December 31, 2003, 2004, 2005, 2006 and 2007 is
$2.8 million, $1.2 million, $0.7 million, $0.7 million and $0.7 million,
respectively.

Note 5  Contingencies

The Company and its subsidiaries are from time to time, party to legal
proceedings arising in the ordinary course of business. Except as discussed in
the Companys Form 10-K for the year ended December 31, 2002, the Company is
unaware of any legal proceedings which, even if the outcome were unfavorable to
the Company, would have a material adverse impact on either its financial
condition or results of operations.

Note 6  Subsequent Events

In May 2003, the Governor of Indiana signed into law a bill requiring
Indiana casino operators to pay gaming taxes at the higher graduated rates
related to dockside gaming effective as of July 1, 2002 and not at the time of
start up of dockside operations in August 2002. The bill also allows 24 hour
gaming at the Indiana casinos, an increase from 21 hours. The Company will
record approximately $3.2 million in additional gaming tax expense in the
second quarter of 2003. This additional tax is payable over two years.

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Item 2.                
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS
OF                             OPERATIONS

The following discussion and analysis provides information which
management believes is relevant to an assessment and understanding of the
consolidated financial condition and results of operations of Horseshoe Gaming
Holding Corp. (the Company) and its subsidiaries. References to Bossier
City, Tunica, and Hammond (or Horseshoe Hammond) refer to the Companys wholly
owned subsidiaries in Bossier City, Louisiana; Tunica, Mississippi; and
Hammond, Indiana, respectively. This discussion should be read in conjunction
with the Companys consolidated condensed financial statements and notes
thereto.

This Quarterly Report on Form 10-Q contains certain forward looking
statements, express or implied, which are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995 and, as
such, speak only as of the date made. The Company undertakes no obligation to
publicly update any forward-looking statements, whether as a result of new
information, future events or otherwise. These forward-looking statements
generally can be identified by phrases such as the Company or its management
believes, anticipates, expects, forecasts, estimates, foresees, or
the negative or other variations thereof or comparable terminology. In
particular, they include statements relating to, among other things, future
actions, new projects, strategies, future performance, the outcome of
contingencies such as legal proceedings and future financial results. These
forward-looking statements are based on the beliefs of management, as well as
assumptions made based on information currently available to management. The
reader is cautioned that forward-looking statements involve risks and
uncertainties, which could cause actual results or events to differ materially
from those expressed or implied therein, including, but not limited to risks
associated with substantial indebtedness, debt service and liquidity;
construction delays or disruption; risks of competition in the Companys
existing and future markets; failure to obtain or retain licenses or regulatory
approvals; and changes in gaming laws and regulations. Further information on
these and other applicable risks are included in the Companys filings with the
Securities and Exchange Commission.

On March 18, 2003, the Louisiana Gaming Control Board renewed the casino
license for Bossier City through November 2004. For further discussion, please
refer to the Companys Form 10-K for the year ended December 31, 2002.

8



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##### Table of Contents



Results of OperationsFinancial Highlights

|                                                   |                       |   |                              |        |                       |   |               |        |   |  |          |     |  
|-------------------------------------------------- | --------------------- | - | ---------------------------- | ------ | --------------------- | - | ------------- | ------ | - |  | -------- | --- | -
|                                                   |                       |   | Three Months ended March 31, |        | % Increase/(Decrease)
|                                                   |                       |   |                              |        |                      
|                                                   |                       |   | 2003                         |        | 2002                  |   | 2003 vs. 2002
|                                                   |                       |   |                              |        |                       |   |              
|                                                   |                       |   | (dollars in thousands)       |        |                       |   |              
|Casino revenues                                    |                       |   |                              |        |                       |   |               |        |   |  |          |    
|                                                   | Bossier City          |   | $                            | 63,574 |                       |   | $             | 64,107 |   |  |          | -1  | %
|                                                   | Tunica                |   |                              | 64,154 |                       |   |               | 69,503 |   |  |          | -8  | %
|                                                   | Hammond               |   |                              | 87,493 |                       |   |               | 74,323 |   |  |          | 18  | %
|                                                   |                       |   |                              |        |                       |   |              
|                                                   |                       | $ | 215,221                      |        |                       | $ | 207,933       |        |   |  | 4        | %  
|                                                   |                       |   |                              |        |                       |   |              
|Net revenues                                       |                       |   |                              |        |                       |   |               |        |   |  |          |    
|                                                   | Bossier City          |   | $                            | 63,498 |                       |   | $             | 64,380 |   |  |          | -1  | %
|                                                   | Tunica                |   |                              | 61,449 |                       |   |               | 67,377 |   |  |          | -9  | %
|                                                   | Hammond               |   |                              | 85,154 |                       |   |               | 73,187 |   |  |          | 16  | %
|                                                   |                       |   |                              |        |                       |   |              
|                                                   |                       | $ | 210,101                      |        |                       | $ | 204,944       |        |   |  | 3        | %  
|                                                   |                       |   |                              |        |                       |   |              
|Operating income (loss)                            |                       |   |                              |        |                       |   |               |        |   |  |          |    
|                                                   | Bossier City (a)      |   | $                            | 10,617 |                       |   | $             | 10,970 |   |  |          | -3  | %
|                                                   | Tunica (a)            |   |                              | 15,278 |                       |   |               | 23,493 |   |  |          | -35 | %
|                                                   | Hammond (a)           |   |                              | 15,184 |                       |   |               | 16,784 |   |  |          | -10 | %
|                                                   | Corporate expenses    |   |                              | (5,498 | )                     |   |               | (4,855 | ) |  |          | 13  | %
|                                                   | Deferred compensation |   |                              | 199    |                       |   |               | (3,116 | ) |  |          | (b  | )
|                                                   | Other                 |   |                              | 56     |                       |   |               | 239    |   |  |          | -77 | %
|                                                   |                       |   |                              |        |                       |   |              
|                                                   |                       | $ | 35,836                       |        |                       | $ | 43,515        |        |   |  | -18      | %  
|                                                   |                       |   |                              |        |                       |   |              
|Other information                                  |                       |   |                              |        |                       |   |               |        |   |  |          |    
|                                                   | Interest expense, net |   | $                            | 12,570 |                       |   | $             | 16,752 |   |  |          | -25 | %
|                                                   | Net income            |   | $                            | 23,266 |                       |   | $             | 26,148 |   |  |          | -11 | %
|                                                  
|Operating margin (operating income/net revenue)(c) |                       |   |                              |        |                       |   |               |        |   |  |          |    
|                                                   | Bossier City (a)      |   |                              | 17     | %                     |   |               | 17     | % |  | 0 pts.  
|                                                   | Tunica (a)            |   |                              | 25     | %                     |   |               | 35     | % |  | -10 pts.
|                                                   | Hammond (a)           |   |                              | 18     | %                     |   |               | 23     | % |  | -5 pts. 
|                                                   | Consolidated          |   |                              | 17     | %                     |   |               | 21     | % |  | -4 pts. 



---

|(a) |  | Before corporate allocations and deferred compensation.                                                                                 
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) |  | Not meaningful.                                                                                                                         
|   
|(c) |  | The % Increase/(Decrease) for operating margin represents the absolute
difference in percentage points (pts.) between the two periods.

9



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##### Table of Contents



Three months ended March 31, 2003 and 2002

Consolidated net revenues for the quarter ended March 31, 2003 increased
3% over the prior year period. This increase was attributable to strong
revenue improvements in Hammond as the result of the conversion to dockside
gaming in August 2002, significantly offset by year-over-year revenue decreases
experienced in both Bossier City and Tunica. The revenue weaknesses in Bossier
City and Tunica, coupled with the tax increases in Bossier City and Hammond,
were the primary reasons each of the three properties experienced decreases in
operating income in the first quarter of 2003.

Casino revenues in Bossier City decreased 1% in the first quarter of 2003
as compared to the prior year period while the Shreveport/Bossier City market
decreased approximately 3% in the same period. Bossier City benefited from
improved hold percentages in the 2003 quarter, however, such improvements were
more than offset by decreases in slot and table volumes. Impacting operating
income and margins was an additional 1% increase in gaming tax over the prior
year. The gaming tax in Louisiana increased from 19.5% to 20.5% in April 2002
and is scheduled to increase to 21.5% in April 2003. No further increases in
tax rates are currently scheduled to occur after April 2003.

Results in Tunica were disappointing in the first quarter of 2003.
Marketing wars in that market have intensified, requiring Tunica to respond by
spending additional marketing dollars to remain competitive. Decreases in
volume coupled with lower hold percentages in both slots and table games
attributed to the revenue decline. Contributing to the decrease in first
quarter 2003 operating income and margins as compared to the comparable period
in the prior year was the $1.9 million positive adjustment, recorded in the
prior year, related to favorable resolutions on various tax matters.

Casino revenues in Hammond increased 18% in the first quarter of 2003 as
compared to the same period in the prior year as a result of the August 2002
conversion to dockside gaming. While Hammond has experienced significant
revenue increases as a result of dockside gaming, operating income and margins
still fell significantly short of prior year due to the increase in state
gaming taxes. For the quarter ended March 2003, Hammonds state gaming tax
rate was approximately 30.5% as compared to 20.0% in the prior year quarter.

Corporate expenses increased 13% in the first quarter of 2003, partially
due to an increase in legal fees and to an increase in estimated franchise
taxes.

Deferred compensation decreased $3.3 million in the first quarter of 2003
as compared to the prior year period due to a reduction in the valuation used
to calculate the value of vested stock appreciation rights.

Interest expense, net decreased 25% in the first quarter of 2003 as
compared to the prior year period due to lower outstanding debt balances during
the 2003 quarter.

Liquidity and Capital Resources

As of March 31, 2003, the Company had cash and cash equivalents of $85.1
million. During the first quarter of 2003, cash provided by operating
activities was $31.9 million, net cash used in investing activities was $8.6
million and net cash used in financing activities was $25.5 million.

10



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##### Table of Contents



As of May 1, 2003, there was $10.0 million outstanding on the Companys
$150.0 million Credit Facility. The Credit Facility is permanently reduced by
$28.1 million on December 31, 2003 and $40.6 million per quarter beginning
March 31, 2004. The Company is currently evaluating its alternatives regarding
the Credit Facility and its other outstanding debt. The Company has no off
balance sheet financing.

Capital expenditures in Hammond during the next twelve months include a
$50.0 million parking garage plus a $15.7 million interim expansion. The
interim expansion includes riverboat and pavilion renovations plus the addition
of approximately 450 slot machines. The parking garage is expected to be
completed in early 2004 while the interim expansion is expected to be completed
in the third quarter of 2003. No material capital expenditures are currently
planned in Bossier City or Tunica during the next twelve months.

The Company believes that the Companys cash and cash equivalents on hand,
cash flow from operations and available borrowing capacity will be adequate to
meet the Companys existing debt service obligations and capital expenditure
commitments for the next twelve months.

Subsequent Events

In May 2003, the Governor of Indiana signed into law a bill requiring
Indiana casino operators to pay gaming taxes at the higher graduated rates
related to dockside gaming effective as of July 1, 2002 and not at the time of
start up of dockside operations in August 2002. The bill also allows 24 hour
gaming at the Indiana casinos, an increase from 21 hours. The Company will
record approximately $3.2 million in additional gaming tax expense in the
second quarter of 2003. This additional tax is payable over two years.

Recently Issued Accounting Pronouncements

In June 2001, the FASB issued SFAS No. 143 Accounting for Asset
Retirement Obligations (SFAS 143). SFAS 143 requires the recognition of
legal obligations associated with the retirement of long-lived assets that
result from the acquisition, construction, development and/or the normal
operation of the long-lived asset, as well as the disclosure of certain
information related to asset retirement obligations. The Company adopted SFAS
143 in the first quarter of 2003. Adoption of SFAS 143 did not have a material
impact on the Companys results of operations or financial position.

In April 2002, the FASB issued SFAS No. 145 Rescission of FASB Statements
No. 4, 44, and 64, Amendments of FASB Statement No. 13, and Technical
Corrections (SFAS 145). SFAS 145 rescinds SFAS No. 4, Reporting Gains and
Losses from Extinguishment of Debt, and an amendment of that statement, SFAS
No. 64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements.
SFAS 145 also rescinds SFAS No. 44, Accounting for Intangible Assets of Motor
Carriers. SFAS 145 amends SFAS No. 13, Accounting for Leases, to eliminate
an inconsistency between the required accounting for sale-leaseback
transactions and the required accounting for certain lease modifications that
have economic effects that are similar to sale-leaseback transactions. SFAS
145 also amends other existing authoritative pronouncements to make various
technical corrections, clarify meanings, or describe their applicability under
changed conditions. The provisions of this statement related to the
rescission of SFAS No. 4 are effective for fiscal years beginning after May 15,
2002. Any extraordinary losses recognized by the Company will be reclassified
within income from operations to conform to the provisions of SFAS No. 145.
The provisions of this statement related to SFAS No. 13 are effective for
financial statements issued on or after May 15, 2002. The implementation of
these remaining provisions did not have a material effect on the Companys
results of operations or financial position.

11



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##### Table of Contents



In June 2002, the FASB issued SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities (SFAS 146). SFAS 146 generally
requires companies to recognize costs associated with exit or disposal
activities when they are incurred rather than at the date of a commitment to an
exit or disposal plan, as previously required under EITF Issue 94-3. Examples
of costs covered by the standard include lease termination costs and certain
employee severance costs that are associated with a restructuring, discontinued
operation, plant closing, or other exit or disposal activity. SFAS 146 is to
be applied prospectively to exit or disposal activities initiated after
December 31, 2002. The Company adopted SFAS 146 in the first quarter of 2003.
Adoption of SFAS 146 did not have a material impact on the Companys results of
operations or financial position.




Item 3.                     Quantitative and Qualitative Disclosure About Market Risk

As of March 31, 2003 there were no material changes to the information
incorporated by reference in Item 7A of the Companys Annual Report on Form
10-K for the fiscal year ended December 31, 2002.




Item 4.                     Controls and Procedures

The Company maintains disclosure controls and procedures that are designed
to ensure that information required to be disclosed in the Companys Exchange
Act reports is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commissions rules and forms,
and that such information is accumulated and communicated to the Companys
management, including its Chief Executive Officer and Chief Financial Officer,
as appropriate, to allow timely decisions regarding required disclosure. In
designing and evaluating the disclosure controls and procedures, management
recognized that any controls and procedures, no matter how well designed and
operated, can provide only reasonable assurance of achieving the desired
control objectives, and management necessarily was required to apply its
judgement in evaluating the cost-benefit relationship of possible controls and
procedures.

Within 90 days prior to the date of this report, the Company carried out
an evaluation, under the supervision and with the participation of the
Companys management, including the Companys Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the Companys disclosure controls
and procedures. Based on the foregoing, the Companys Chief Executive Officer
and Chief Financial Officer concluded that the Companys disclosure controls
and procedures were effective.

There have been no significant changes in the Companys internal controls
or in other factors that could significantly affect the internal controls
subsequent to the date the Company completed its evaluation.

12



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##### Table of Contents









PART II                    OTHER INFORMATION

Item 6.                     EXHIBITS AND REPORTS ON FORM 8-K

|         |  |                                                                                                                        
|-------- |  | -----------------------------------------------------------------------------------------------------------------------
|Exhibit  |  |                                                                                                                        
|Number   |  | Description                                                                                                            
|         |  |                                                                                                                        
|3.1 (a)  |  | Certificate of Incorporation of Horseshoe Gaming Holding Corp.                                                         
|3.2 (a)  |  | By-laws of Horseshoe Gaming Holding Corp.                                                                              
|99.1 (b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|99.2 (b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|         |  |                                                                                                                        
|(a)      |  | Filed as an Exhibit to Horseshoe Gaming Holding Corp.s Form
S-4 Registration Statement filed on June 15, 1999.        
|(b)      |  | Included herein.                                                                                                       

Reports on Form 8-K filed during the quarter:

None.

13



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##### Table of Contents






SIGNATURE

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.

|                  |  |                                                       |  |                                                                                                                      
|----------------- |  | ----------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------
|                  |  | HORSESHOE GAMING HOLDING CORP.
a Delaware corporation
|                  |  |                                                       |  |                                                                                                                      
|Date: May 9, 2003 |  | By:                                                   |  | /s/ Kirk C. Saylor

Kirk C. Saylor
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)

14



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##### Table of Contents






CERTIFICATION

I, Kirk C. Saylor, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of Horseshoe Gaming
Holding Corp.;                                                                                                                                                                                                                                         
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                   
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     



| | (a) |  | Designed such disclosure controls and procedures
to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly
during the period in which this quarterly report is being
prepared;
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | Evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | (c) |  | Presented in this quarterly report our
conclusions about the effectiveness of the disclosure controls
and procedures based on our evaluation as of the Evaluation
Date;                                                                                                                        



|5. |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (a) |  | All significant deficiencies in the design or
operation of internal controls which could adversely affect
the registrants ability to record, process, summarize and
report financial data and have identified for the registrants
auditors any material weaknesses in internal controls; and
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | Any fraud, whether or not material, that involves
management or other employees who have a significant role in
the registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                  |  |                                                           
|----------------- |  | ----------------------------------------------------------
|Date: May 9, 2003 |  | /s/ Kirk C. Saylor

Kirk C. Saylor
Chief Financial Officer

15



---



##### Table of Contents



CERTIFICATION

I, Jack B. Binion, certify that:



|1) |  | I have reviewed this quarterly report on Form 10-Q of Horseshoe Gaming
Holding Corp.;                                                                                                                                                                                                                                         
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2) |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3) |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                   
|  
|4) |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     



| | (a) |  | Designed such disclosure controls and procedures
to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly
during the period in which this quarterly report is being
prepared;
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | Evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | (c) |  | Presented in this quarterly report our
conclusions about the effectiveness of the disclosure controls
and procedures based on our evaluation as of the Evaluation
Date;                                                                                                                        



|5) |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (a) |  | All significant deficiencies in the design or
operation of internal controls which could adversely affect
the registrants ability to record, process, summarize and
report financial data and have identified for the registrants
auditors any material weaknesses in internal controls; and
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | Any fraud, whether or not material, that involves
management or other employees who have a significant role in
the registrants internal controls; and                                                                                                                                        



|6) |  | The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                  |  |                                                           
|----------------- |  | ----------------------------------------------------------
|Date: May 9, 2003 |  | /s/ Jack B. Binion

Jack B. Binion
Chief Executive Officer

16



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##### Table of Contents






EXHIBIT INDEX

|         |  |                                                                                                                        
|-------- |  | -----------------------------------------------------------------------------------------------------------------------
|Exhibit  |  |                                                                                                                        
|Number   |  | Description                                                                                                            
|         |  |                                                                                                                        
|3.1 (a)  |  | Certificate of Incorporation of Horseshoe Gaming Holding Corp.                                                         
|3.2 (a)  |  | By-laws of Horseshoe Gaming Holding Corp.                                                                              
|99.1 (b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|99.2 (b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|         | 
|(a)      |  | Filed as an Exhibit to Horseshoe Gaming Holding Corp.s Form
S-4 Registration Statement filed on June 15, 1999.        
|(b)      |  | Included herein.