LV firm posts strong quarter

Thursday, Oct. 11, 2001 | 9:19 a.m.

Alliance Gaming Corp. of Las Vegas reported a 121 percent increase in net income for the quarter ending Sept. 30, despite a slowdown in some of its business lines following the Sept. 11 terrorist attacks.

Alliance posted net income of $7.4 million, or 32 cents per share, compared to earnings of $3.4 million, or 16 cents per share, in the year-ago period. This was in line with analysts' pre-Sept. 11 expectations. Revenues increased 9 percent to $129.8 million, while cash flow rose 15 percent to $22.6 million.

The strongest component of Alliance's business for the quarter was Bally Gaming and Systems, its slot manufacturing arm. Bally reported $11.9 million in cash flow, a 55 percent increase over the year-ago quarter. Sales of both slot machines and software systems improved, and Alliance said more of Bally's business is now concentrated in revenue-participation slot machines, a more profitable business.

Alliance's slot routes in Nevada and Louisiana experienced a dip in business after Sept. 11, but have seen business return to normal, the company said. The slot routes reported cash flow of $6.6 million, up 12 percent.

The company's casinos in Vicksburg, Miss., and Sparks also saw some decline after the attacks, and the Vicksburg casino's results were down from the year-ago quarter. A strong quarter in Sparks offset this somewhat, but casino operation cash flow was still down 4.5 percent to $6.4 million.

Bally Wulff, the company's German amusement machine business, reported negative cash flow of $100,000, compared to $1.9 million in positive cash flow a year ago. Alliance blamed this on customers delaying the purchase of new machines "in the face of impending new regulations."

Alliance stock rose 54 cents this morning to $17.51.