Casino Data posts a profit, higher revenue

John Wilen

Tuesday, Oct. 20, 1998 | 12:28 p.m.

Casino Data Systems turned a loss into a profit and reported improved sales in the quarter ending Sept. 30.

The Las Vegas maker of casino management systems, games and meters, multi-site progressive systems and casino signs today reported profits of $48,000, or less than 1 cent per share, on revenues of $15 million. In the year-ago quarter, Casino Data Systems lost $2.3 million, or 13 cents per share, on revenues of $10.5 million.

The improved earnings came despite a $1 million payment to settle a shareholder lawsuit.

"We are particularly pleased that we achieved profitability despite the $1 million shareholder litigation settlement," said Howard Yenke, Casino Data System's chief executive officer.

The company's sales reflect a significant change in business mix from progressive systems to system and product sales. One year ago, Casino Data Systems generated $5.3 million in revenues from progressive systems and $5.2 million from sales of systems and products. In this year's quarter, progressive revenues dropped to $2.3 million while system and product sales jumped to $12.7 million.

The company attributed the higher system and product sales to upgrades of existing systems and sales of new product lines. Progressive revenues declined due to the termination of Casino Data Systems' Caribbean Stud Video Poker link and its Nevada and Mississippi Cool Millions links. The declines were partially offset by revenues from the company's new Extreme progressive link.

Casino Data Systems attributed its profits to greater cost controls. Selling, general and administrative expenses declined 8 percent from last year's quarter due to staff reductions, decreases in consulting and professional fees, a reduction in bad debt expense, and reduced advertising.

A company restructuring at the end of last year combined with fewer progressive and operational units to reduce depreciation and amortization expenses by $603,000.

"We have seen positive results from the emphasis on cost control in all aspects of our operation over the last year," said Lee Lemas, Casino Data Systems' chief financial officer.