GameTech reports Q4

RENO, Nevada -- (PRESS RELEASE) -- GameTech International, Inc. (Nasdaq: GMTC), a leading designer, developer and marketer of electronic bingo and gaming equipment, systems, and video lottery terminals, today announced financial results for the Company's fourth fiscal quarter and 2007 fiscal year end results. Net income totaled $1.7 million for the quarter, or $0.13 per fully diluted share, which is up from $1.0 million and $0.08 per fully diluted share for the 4th quarter in fiscal 2006. Fiscal year end net income for fiscal 2007 reached $5.0 million, or $0.39 per fully diluted share, compared with $4.4 million or $0.34 per fully diluted share for the comparable period in 2006.

Company Highlights:

-- Net income for the fourth quarter of fiscal 2007 was $1.7 million, compared with $1.0 million for the same period in fiscal 2006, an increase of 59.3%; net income for fiscal year end 2007 was $5.0 million compared with $4.4 million in the same period in fiscal 2006, an increase of 14.3%.

-- Net income per fully diluted share reached $0.13 for the fourth quarter and $0.39 for fiscal year 2007, compared with $0.08 and $0.34 for the same periods in fiscal 2006.

-- Revenue for the fourth quarter of fiscal 2007 was $17.4 million compared with $12.0 million for the same period in fiscal 2006. Revenue for fiscal year end 2007 was $59.5 million compared with $49.3 million for the same period in fiscal 2006.

-- EBITDA for the fourth quarter of fiscal 2007 was $6.2 million compared with $4.3 million for the same period in fiscal 2006. EBITDA for fiscal year end 2007 was $20.9 million compared with $17.3 million for the same period in fiscal 2006.

-- During the quarter the company paid down $9.5 million in debt through cash flow from operations. Another $1.1 million of the term loan debt was repaid on December 28, 2007, resulting in a total of $10.6 million of debt repaid in the first nine-months since the Summit acquisition. The company ended the fiscal year ended October 31, 2007, with $11.4 million in cash and cash equivalents.

-- Subsequent to the close of the fiscal year the company bought back a total of 281,906 shares under the current stock repurchase program. This represents a reduction of 2.2% of the fully diluted shares outstanding as of October 31, 2007.

-- During the quarter, Kevin Peterson was named General Manager of the Summit Gaming division.

Fourth quarter revenue totaled $17.4 million compared with $12.0 million for the comparable quarter during fiscal 2006. Revenue for fiscal year ended October 31, 2007, was $59.5 million compared with $49.3 million for the comparable period in fiscal 2006. The increase in revenue for the three and twelve-month periods ended October 31, 2007 was primarily due to a full two quarters of results from the acquisition of Summit Amusement & Distributing, LTD., a manufacturer of video lottery terminals. While bingo revenue was impacted by some competitive pricing pressure and the loss of certain accounts in the domestic market, they were offset in part by continued increases in other states as well as the rollout of our Traveler (TM) unit in the United Kingdom markets. Additionally, the company sold games on participation in Montana with a route operator at favorable economic terms that resulted in a one-time gain.

Jay Meilstrup, GameTech's President and Chief Executive Officer stated, "In the fourth quarter our domestic bingo business saw continued revenue growth in some of the larger domestic bingo markets, as well as in the United Kingdom, which helped to offset some of the price erosion in some of the more mature domestic bingo markets. Our international expansion efforts continued during the quarter as we placed our Traveler (TM) units in additional bingo halls in the United Kingdom under our contract with MECCA Bingo. Our Summit division's results for the quarter saw the benefits of the one-time sale of games on participation with a route operator in Montana as well as pick up of business in Louisiana that was delayed in the 3rd quarter. Sales for our Summit division will continue to vary from quarter to quarter depending on the timing of orders of customers in our two primary markets, Louisiana and Montana. We anticipate that as we expand into additional gaming markets with our Summit product that the variability in the revenue from our Summit division will become less volatile. We continue on track with our first deployment of our wireless gaming system the GameTech Mini (TM) in 2008 and anticipate revenue contribution to occur from this new technology in the first half of fiscal 2008.

"Finally, we finished the fiscal year in a very strong financial position. Since the Summit acquisition in late March 2007, we have paid down $10.6 million in debt which represents over 25% of the purchase price paid for Summit Gaming. We have also bought just over 280,000 shares of company stock since our stock repurchase agreement was announced in September 2007, and our cash position as of the end of the fiscal year 2007 stood at $11.4 million. We are very excited about the prospects for the company in fiscal 2008. GameTech anticipates completion of testing with the independent labs and California tribal approval for Class III device installation by the end of 2nd quarter fiscal 2008, and approval for field trial of traditional slot devices by the Nevada Gaming Control Board by the end of 4th quarter fiscal 2008. With the acquisition of and integration of Summit Gaming and GameTech's new product development efforts in wireless, server based gaming and lottery areas, GameTech is on track in its goal of diversifying the company to a full-service Class II and Class III systems and product supplier."