Slot-machine sales, social gaming boost IGT earnings

IGT - International Game Technology, a slot machine manufacturer and social gaming company, reported a modest increase in profit for its second quarter, helped significantly by growth in machine sales and social gaming.

The company Thursday posted second quarter earnings of $78.2 million, or 29 cents per share, up from $61.9 million, or 21 cents per share, in the same period last year.

Revenues were $600 million, up 11 percent year-over-year from $541.2 million.

Analysts polled by Yahoo Finance expected IGT to earn 29 cents per share on revenue of $571.6 million.

“We are very pleased with our momentum through the second quarter, demonstrating the strength of our comprehensive strategy — leveraging our core business, broadening the distribution of our premier content and generating shareholder returns,” said Patti Hart, CEO of IGT.

In its earnings report, the company’s gaming operations declined slightly to $254.3 million, from $266.1 million, primarily because of lower Mega Jackpots revenue. Gross margins improved to 62 percent from 61 percent last year.

Average revenue per unit per day was down 6 percent to $49.26, from $52.34 in the second quarter of last year because of lower play.

Revenues from product sales rose 16 percent year-over-year to $279 million, from $240.8 million. The company said machines in use increased 40 percent to 14,300 in the second quarter from increased sales to Canada and new casino openings.

IGT said revenues from its social gaming franchises, including DoubleDown Casino, increased 94 percent in the second quarter to $66.7 million from $34.3 million last year. The increase in revenue was helped by a 25 percent jump in daily active users of DoubleDown Casino to $1.69 million.

Hart expected fiscal 2013 to be the company’s “fourth consecutive year of double digit growth in adjusted earnings per share from continuing operations.”

Looking ahead, IGT expects fiscal year 2013 earnings per share of between $1.26 and $1.32, versus the consensus of $1.26.

IGT reported second-quarter earnings Thursday after the markets closed.

Shares of IGT gained 59 cents, or 3.53 percent, to close at $17.30 on the New York Stock Exchange. In after hours trading, IGT shares rose 45 cents, or 2.60 percent, to $17.75.