Thursday, July 17, 2003 | 10:54 a.m.
SUN STAFF AND WIRE REPORTS
RENO -- International Game Technology today announced another quarter of record earnings, a winning streak company officials said is fueled by demand for replacement machines with cashless technology.
For the third quarter ending June 28, the Reno-based company reported net income of $103.7 million, or 30 cents per share, up from $82.6 million, or 23 cents a share for same quarter last year.
Revenue rose 16 percent over the same quarter in 2002 to $597.5 million.
The latest quarterly report marks the "fourteenth consecutive quarterly period in which earnings have increased over the comparative prior year," Chief Executive Thomas Baker said.
The quarterly earnings beat the expectations of analysts surveyed by Thomson First Call by 3 cents a share.
In early trading on the New York Stock Exchange, IGT stock was at $26.70 a share, up 19 cents.
Third-quarter earnings also reflected a four-for-one stock split announced by the company in June as well as a cash dividend of .075 cents per share that will be paid July 28.
IGT also announced a $130 million merger with Acres Gaming of Las Vegas during the quarter.
"This strategic acquisition reflects our long-term commitment to the systems business and strengthens our capacity to provide innovative and reliable system products to the gaming industry," Baker said.
The merger is awaiting approval from gaming regulators and Acres shareholders and should be completed by the end of the year, Baker said.
Cashless machines issue bar-coded tickets for payoffs that can either be redeemed for money or played in another machine.
Replacement sales were up 68 percent and accounted for 17,500 of the 24,200 machines sold domestically during the quarter, the company said.
For the nine months of the year, domestic replacement shipments totaled 42,500 machines, a 44 percent increase over the previous year. Replacement machines accounted for about two-thirds of total domestic sales for the year so far.
"We see a good amount of business left to go," Baker said of the replacement market.
IGT sells about 70 percent of all slot machines and said demand from Indian casinos and from casinos in Atlantic City was strong.
"They're the leader in cashless, and all the new slot machines going in are cashless," Turner Investment Partners analyst Jason Schrotberger told Bloomberg News.
By the end of the year, IGT said it planned to introduce several new theme games, including UNO, MASH, Magic 8 Ball and Video Sinatra.
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