Las Vegas gaming technology provider lowers financial guidance projections and plans to cut expenses by one-quarter
gaming technology provider Progressive Gaming International appointed Terrance
W. Oliver as the company's interim president and CEO. Oliver replaces
Russel H. McMeekin, who recently stepped down to pursue other opportunities.
The personnel change accompanied Progressive’s announcement
that it would fall short of its previously projected 2008 financial guidance
for revenues, slot and table management systems installed base, adjusted earnings
before interest, taxes, depreciation and amortization (EBITDA) and gross
margins. As a result, Progressive also said it has taken action to reduce
expenses, including annual aggregate selling, general and administrative,
research and development and operating expenses, by $13 to $15 million, or
approximately 25 to 29 percent.
As part of the expense reduction, the company said it has
streamlined certain sales, marketing and service functions by leveraging
distribution channels and through the planned consolidation of regional
offices. Additionally, the company will not participate in trade shows and
instead will focus on direct customer meetings and focus groups. The company's
executive management has agreed to a reduction of their salaries along with
foregoing other fringe benefits.
“The $13 to $15 million reduction in annual operating
expenses positions the company to achieve improving EBITDA and cash flows at a
time when worldwide economic challenges have slowed the adoption rate for
gaming industry system placements. Accordingly, while we believe our cost
reductions and continued focus on sales addresses this near-term uncertainty,
we have, as disclosed last week, suspended our full-year guidance for revenue
and systems installed base metrics and EBITDA,” Oliver said.
Oliver has been a director of the company since 1988, and
served as chairman of the board of directors from 1988 to 1993. He currently
serves on the board of managers of Peninsula Gaming Partners LLC, which
operates the Diamond Jo Casino in Iowa and the
Evangeline Downs Racino in Louisiana.
No statement was announced regarding a permanent CEO at this time.
Progressive Gaming Announces Interim CEO, Expense Reductions
October 2, 2008