Slot manufacturer reports big loss

Friday, Nov. 23, 2001 | 10:15 a.m.

Innovative Gaming Corp. of America, a small Las Vegas-based slot manufacturer, posted a loss of $10.2 million, or 57 cents per share, for the quarter ending Sept. 30. That compares to net income of $148,000, or 2 cents per share, in the year-ago quarter.

The company reported just $700,000 in revenues for the quarter, down from $2.16 million in the year-ago period. IGCA said sales were hampered by a lack of working capital, which it said prevented the company from filling its orders. However, IGCA said it has secured $13 million in lease and credit financing, which will enable it to fill future orders.

One-time charges took a heavy toll on the company's earnings. The company reported a $5.6 million charge from the write-down of receivables from "two significant customers," but did not elaborate. Nor did IGCA elaborate on a $3.1 million loss taken from "unabsorbed operating expenses."

The company also took $1.5 million charge from losses on an investment in Xertain Inc., a privately held Las Vegas gaming technology company. IGCA announced plans to merge with Xertain in early 2000, but called off this merger last month.

IGCA said it is now focusing its sales efforts on participation slot machines. It said it has submitted three new game titles to gaming regulators for approval, and expects to submit 12 more titles in 2002.