Wednesday June 13, 4:00 PM Eastern Time
SOURCE: GameTech International, Inc.
Company Highlights:
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Net income for the second quarter of fiscal 2007 was $1.2 million, compared with $1.2 million for the same period in fiscal 2006; net income for the first half of fiscal 2007 was $2.3 million compared with $2.0 million in the same period in fiscal 2006, an increase of over 12%. |
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Net income per fully diluted share reached $0.09 for the second quarter and $0.17 for six months, compared with $0.09 and $0.16 for the same periods in fiscal 2006. |
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Revenue for the second quarter of fiscal 2007 was $13.4 million compared with $12.5 million for the same period in fiscal 2006. Revenue for the first half of fiscal 2007 was $25.4 million compared with $24.9 million for the same period in fiscal 2006; |
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For the first six months of fiscal 2007 EBITDA approximated $9.2 million, an increase of $1.0 million from 2006. |
RENO, Nev. (June 13, 2007) — GameTech International, Inc. (Nasdaq: GMTC), a leading designer, developer and marketer of computerized bingo and gaming equipment, systems, and services, today announced financial results for the Company’s second fiscal quarter and six-month period ended April 30, 2007. Net income totaled $1.2 million for the quarter, or $0.09 per fully diluted share, which is consistent with $1.2 million and $0.09 per fully diluted share for the second quarter in fiscal 2006. Year-to-date net income for fiscal 2007 reached $2.3 million, or $0.17 per fully diluted share, compared with $2.0 million or $0.16 per fully diluted share for the comparable six-month period in 2006.
Second quarter revenue totaled $13.4 million compared with $12.5 million for the comparable quarter during fiscal 2006. Revenue for the six-month period ended April 30, 2007, was $25.4 million compared with $24.9 million for the comparable period in fiscal 2006. The increase in revenue for the three and six-month periods ended April 30, 2007 was primarily due to the completion of the acquisition of Summit Amusement & Distributing, Ltd., a manufacturer of video lottery terminals and revenue increases in Michigan, Louisiana, Oklahoma and the United Kingdom, partly offset by decreased revenue due to the loss of certain accounts in other domestic markets.
As previously announced, during the quarter, we completed our acquisition of substantially all of the assets of Summit Amusement & Distributing, Ltd.
Also as previously announced, in May 2007 the United States Court of Appeals for the Ninth Circuit issued its ruling in our favor in GameTech International, Inc. v. Trend Gaming Systems, LLC, upholding each of the items we appealed, reversing the trial court’s rulings and remanding the matter back to the trial court for a new trial. As a result of this decision, bonds posted by us in excess of $4.5 million prior to filing the appeal will be available for return to us upon successful petition to the lower court. Currently, there is no set date as to when the matter will be returned to the control of the lower court.
Jay Meilstrup, GameTech’s President and Chief Executive Officer stated, “Our revenue has been strong in Michigan, Louisiana, Oklahoma and in the United Kingdom, as we have emphasized growing our core business and integrating Summit. With the completion of the Summit acquisition in late March, the second fiscal quarter was a transitional quarter. We look forward to capitalizing on Summit’s potential for its products in new markets as well as expanding the sale of our bingo products and services into new domestic and international markets. In addition, GameTech intends to leverage its years of technical capabilities in wireless to expand into the newly developing mobile gaming market. For the remainder of the year, we also anticipate new business from the introduction of new products and we will continue to pursue strategic opportunities if and when they arise.”
About GameTech International, Inc.
GameTech International, Inc. is in the business of designing, manufacturing, and marketing computerized bingo and gaming equipment, systems, and services. Under the GameTech® brand the company provides electronic bingo systems and equipment. Under the Summit Gaming™ brand the company provides video lottery terminals and slot machine gaming devices. GameTech International, Inc. is an innovator in advanced wireless gaming applications and devices as well as software and content for traditional slot machine games. GameTech International, Inc. serves customers in 41 U. S. States, Canada, Japan, Mexico, Norway, Philippines, and the United Kingdom, and Mexico. The company was incorporated in 1994 and is headquartered in Reno, Nevada.
Statements contained in this press release that are not historical facts are intended to be forward-looking statements subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include our potential expansion of business internationally, opportunities created by the Summit acquisition, new product and product feature developments, the success of our strategic opportunities and initiatives, and expectations relating to financial and operating results. GameTech cautions that these statements are subject to risks and uncertainties that could cause actual results to differ materially from those reflected by the forward-looking statements contained herein. Such factors include our ability to successfully integrate, operate and grow Summit’s business, our dependence on the bingo and video lottery terminal businesses, risks associated with rapid technological change, our ability to retain customers and secure new customers, and other factors disclosed in documents filed by the Company with the Securities and Exchange Commission, including the Company’s most recently filed Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date of this release, and we undertake no obligation to update such statements.
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GAMETECH INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
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Three Months Ended April 30, |
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Six Months Ended April 31, |
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2007 |
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2006 |
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2007 |
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2006 |
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(Unaudited) |
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(Unaudited) |
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Net revenue |
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$ |
13,411 |
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$ |
12,533 |
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$ |
25,428 |
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$ |
24,880 |
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Cost of revenue |
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5,946 |
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4,955 |
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10,869 |
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9,607 |
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Gross profit |
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7,465 |
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7,578 |
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14,559 |
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15,273 |
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Operating expenses: |
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General and administrative |
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1,996 |
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2,300 |
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3,968 |
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4,914 |
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Sales and marketing |
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3,022 |
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2,791 |
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5,931 |
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5,511 |
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Research and development |
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785 |
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623 |
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1,387 |
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1,677 |
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Loss contingencies |
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46 |
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33 |
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93 |
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65 |
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Total operating expenses |
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5,849 |
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5,747 |
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11,379 |
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12,167 |
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Income from operations |
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1,616 |
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1,831 |
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3,180 |
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3,106 |
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Interest expense |
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(353 |
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(3 |
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(355 |
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(5 |
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Other income (expense), net |
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166 |
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100 |
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325 |
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202 |
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Income before income taxes |
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1,429 |
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1,928 |
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3,150 |
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3,303 |
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Provision for income taxes |
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483 |
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742 |
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1,132 |
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1,278 |
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Income from operations |
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946 |
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1,186 |
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2,018 |
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$ |
2,025 |
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Cumulative effect of accounting change |
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261 |
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0 |
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261 |
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0 |
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Net income |
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$ |
1,207 |
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$ |
1,186 |
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$ |
2,279 |
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$ |
2,025 |
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Net income per share: |
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Basic |
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Income from operations |
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$ |
0.08 |
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$ |
0.10 |
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$ |
0.16 |
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$ |
0.17 |
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Cumulative effect of accounting change |
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$ |
0.02 |
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$ |
0.00 |
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$ |
0.02 |
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$ |
0.00 |
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Net Income |
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$ |
0.10 |
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$ |
0.10 |
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$ |
0.18 |
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$ |
0.17 |
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Diluted |
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Income from operations |
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$ |
0.07 |
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$ |
0.09 |
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$ |
0.15 |
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$ |
0.16 |
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Cumulative effect of accounting change |
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$ |
0.02 |
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$ |
0.00 |
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$ |
0.02 |
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$ |
0.00 |
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Net Income |
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$ |
0.09 |
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$ |
0.09 |
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$ |
0.17 |
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$ |
0.16 |
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Shares used in calculating net income per share: |
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Basic |
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12,554 |
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12,094 |
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12,538 |
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12,002 |
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Diluted |
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13,099 |
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12,654 |
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13,111 |
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12,540 |
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April 30, |
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October 31, |
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Select Balance Sheet Data: |
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2007 |
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2006 |
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(Unaudited) |
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(Audited) |
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Cash and cash equivalents |
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$ |
5,881 |
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$ |
5,411 |
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Short-term investments |
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4,856 |
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7,408 |
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Restricted short-term investments |
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4,515 |
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4,515 |
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Total current assets |
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31,180 |
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23,984 |
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Total assets |
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$ |
100,353 |
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$ |
59,214 |
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Total current liabilities |
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$ |
10,666 |
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$ |
8,752 |
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Total liabilities |
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48,209 |
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9,380 |
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