Firm’s sales up, profit declines

Wednesday, May 5, 1999 | 11:28 a.m.

Jackpot Enterprises Inc. reported slightly lower earnings and cash flow on higher sales in the company's third fiscal quarter that ended March 31.

Jackpot's net income declined from $1.9 million in the year-ago quarter to $1.8 million this year. Per-share profits were flat at 21 cents. Earnings before interest, taxes, depreciation and amortization (EBITDA or cash flow) also fell, from $3.9 million in the year-ago quarter to $3.8 million.

Revenues increased from $23.4 million in last year's quarter to $24.6 million.

The company gave no reason for the lower third quarter earnings and cash flows. Over the first nine months of the company's fiscal year, earnings declined due to lower revenues at existing gaming machine route operations, an increase in depreciation expense and lower non-operating income, the company said.

Jackpot operates 4,300 gaming machines on a slot route, and owns two small casinos in Northern Nevada.

Revenues from route operations rose from $22.7 million in the year-ago quarter to $24.1 million this year due to new location openings and an increase in revenues from existing chain store customers.

"This improvement is primarily due to: better revenue performance at existing locations; continued population growth of the Nevada economy, especially Clark County; and our ongoing focus on operating costs," Don Kornstein, Jackpot's president and chief executive, said in a statement.

Jackpot is in an agreement to buy Players International Inc., an Atlantic City-based operator of gaming properties in the Midwest and South, for $424 million in cash, stock and debt. Jackpot bought more than 1 million Players shares in the quarter for $6.1 million.