IGT reports second-quarter results
April 23, 2009
International Game Technology (NYSE:
IGT) reported financial results for the second quarter ended March 31,
2009.
Net income for the quarter was $38.3 million
or $0.13 per diluted share compared to $68.4 million
or $0.22 per diluted share in the same quarter last year. For
the six month period ended March 31, 2009, net income was $104.0
million or $0.35 per diluted share compared to $182.1
million or $0.57 per diluted share in the same period
last year. Both the current and prior year three and six month periods were
unfavorably impacted by a number of significant items.
"Our second quarter saw continued difficult
economic conditions worldwide impacting our financial results, but in a number
of jurisdictions we are beginning to see stability in play levels," said
CEO Patti Hart. "While the environment has been
challenging, the success of our innovative new products and business efficiency
initiatives give us confidence in our future prospects. In my first month as
CEO, I have seen the determination of our employees to capitalize on our
industry leadership, and I am confident the results of our efforts will allow
IGT to emerge a stronger company once we experience a period of sustained
economic stabilization."
Gaming operations quarterly revenues and gross profit
declined 14% and 6%, respectively, over the prior year quarter. Declines were
the result of lower play levels as well as growth in the mix of stand alone and
lease operations games in our installed base. Gross margin was 59% in the
quarter compared to 54% in the prior year quarter. The prior year margin was
negatively impacted by additional jackpot expense associated with a sharp
decline in interest rates and charges for technological obsolescence during
that quarter.
IGT’s installed base of recurring revenue games increased to 61,300 units, up 1,700 units or 3% from the prior year and up 400 units from the previous sequential quarter. The increase over the prior year was driven by growth in international placements partially offset by a reduction in domestic CDS/Class II and Class III markets.
Product sales
revenues and gross profit in the second quarter declined 22% and 31%,
respectively, while units shipped worldwide increased 4% over the prior year
period. On a regional basis for the quarter, North
America revenues decreased 14% driven by a decline in
replacement sales partially offset by increased sales of new/expansion units.
International revenues declined 35% for the quarter as a result of a less
favorable geographic mix of sales, with fewer shipments into casino markets
partially offset by increased shipments into Japan and the UK. Total
consolidated gross margin on product sales for the quarter was 48% compared to
55% in the prior year quarter, primarily due to a greater proportion of lower
margin sales in Japan
and the UK
and lower levels of non-machines revenues.
See IGT’s full 2Q
statement
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