Las Vegas-based American Wagering narrows its loss

Tuesday, May 4, 1999 | 10:54 a.m.

American Wagering Inc. reported a significant reduction in its losses on modest revenue increases in the year that ended Jan. 31.

The company's losses declined from $8.8 million last year, or $1.13 per share, to $1.6 million this year, or 21 cents per share. Revenues grew from $9.3 million last year to $9.9 million this year.

American Wagering said its revenues grew across the board. The company said the growth was due to increases in sports book handle -- the total amount wagered at company sports books -- while there was relatively no change in win percentage.

Handle grew to $108.4 million in the year, up from $93.6 million last year. American Wagering said the growth in handle was due to the net increase of five sports book locations.

American Wagering owns and operates 48 Leroy's Horse and Sports Place race and sports book locations in Nevada. The company also owns CBS, a race and sports book equipment and software supplier and the owner of MegaSports, a 150-room hotel-casino in Las Vegas and an Australian subsidiary that offers race and sports book wagering over the Internet.

The company said revenues from CBS systems increased $196,00 in the year, and casino revenues increased $72,000.

Earnings before interest, taxes, depreciation and amortization (EBITDA) increased to $173,000 for the year from negative EBITDA of $687,000 last year. The EBITDA increases were due to higher sports book revenues, lower sports book costs, and increases in casino and systems operations. EBITDA was negatively impacted by start-up costs of $318,000 related to American Wagering's Keno and Australian Internet operations.

"The recently completed year was a transition year for the company," said Victor Salerno, American Wagering's chief executive, in a statement. "We had a significant decrease in operating costs and expenses while still continuing our plans for growth."

Salerno said the Keno and Internet operations will be significant revenue sources for the company in the future.

American Wagering shares were down 13 cents to $5.50 in early afternoon trading.