internationalcasinoreview Business NEWS
Record year for Shuffle Master
Shuffle Master’s year was tempered with sadness following the premature death in May of former CEO Tim Parrott: however the company maintained the discipline he helped instil to turn in an excellent set of results that confirms it much surer footing than in previous years.
fittingtribute SHUFFLE MASTER
With a wide range of prod- ucts from the shufflers seen in most modern casinos to proprietary table games that have proven themselves excellent earners for opera- tors and a largely lease-based business model that keeps the revenues rolling in, Shuffle Master hit its stride in FY2010, reporting record revenues and profits. Net revenues in the year to the end of October were up 12.2 per cent on 2009 to $201.3m (E155m). $86.7m (E66.7m) of that was gener- ated by product leases and royalties, ahead by 13.8 per cent, with product sales and service fetching $114.6m (E88.2m), up 11.1 per cent. Margins were also up on
the previous year by 270 basis points to 62 per cent, for which the company credits strong segment per- formance and reduced amortisation. Net profit for the year was $23.1m (E17.8m), up fully 54 per cent on 2009, despite charges relating to its legal settlement with Prime Table Games and financing costs for its previous credit agree- ment.
The company’s net debt position improved dramati- cally in 2010, falling more than a third to $56.3m (E43.3m) - its lowest level since 2003.
David Lopez, interim CEO of Shuffle Master, com- mented: “The continued growth of our recurring revenue stream, as illus- trated by total revenue
iDeal helped Shuffle Master Utility segment to increased profits in the year
exceeding $200m, makes a compelling arguments for our ability to capture and retain business with our powerful IP portfolio.” Shuffle Master’s business
operates in four divisions. The Utility segment, which includes the shufflers and the iDeal system, saw rev- enues up 7.8 per cent to $77.3m (E59.5m) in the year for a gross profit of $47m (E36.2m) up 16 per cent; gross margin was up 430 basis points to 60.8 per cent. Proprietary Table Games brought in $40.4m
(E31.1m), up 4.4 per cent; gross profit was flat at $32.3m (E24.9m), but gross margin softened by 290 basis points to 80 per cent as a result of installation costs of new side bet and progressive units. Place- ments in Australia, Singapore and the US helped Elec- tronic Table Games revenues jump 90.1 per cent to $42.4m (E32.6m) creating gross profit of $21.6m (E16.6m), up 129.8 per cent and a gross margin up 870 basis points to 50.9 per cent. Despite a fall in revenues in
Private equity sniffing round Palms Two private equity companies are reportedly in talks with the owner of the Palms resort in Las Vegas, George Maloof, for a majority share. TPG Capital, one of the groups that owns Caesars Entertainment (formerly Harrah’s), and Leonard Green & Partners, which is buying MGM Resorts half of Borgata in Atlantic City, acquired discounted Palms-backed loans last year.
Slots on a roll in
betterandbetter PENNSYLVANIA
Slot machine gross revenues in Pennsylvania hit $174.8m (E124.6m) in December, almost 13 per cent higher than in the same month in 2009. For just the nine casinos that were operating fully in both months, there was an increase of 6.5 per cent. Kevin O’Toole, executive
director of the Pennsylvania Gaming Control Board (PGCB), which collected the figures, said: “2010 was a another good year of solid growth in slot revenue. For the fourth year in a row, Pennsylvania saw an increase in revenue from legalised casino gaming and with the popularity of table games, tax revenue should continue grow throughout 2011.”
The biggest gainer was
the Electronic Gaming Machine segment of 11.8 per cent to $41.1m (E31.6m), gross profit was more resilient falling 2.5 per cent to $23m (E17.7m), meaning gross margin actu- ally rose 530 basis points to 56 per cent.
Ten per cent drop in 2010 gaming revenues in AC
worseandworse NEW JERSEY
While across the border in Pennsyl- vania, the casinos’ fortunes set fair with rising revenues and new oppor- tunities, in New Jersey the opposite story being told. Casino revenues are on a relentless downward trajec- tory. Atlantic City is still posting higher revenues than its upstart neighbour for the time being however.
Casino revenues in the US’s second gaming city were down 9.6 per cent to $3.56bn (E2.74bn), according to figures released by the New Jersey Casino Control Com- mission (NJCCC). Slot machine rev- enues were down nine per cent to
The casinos of Atlantic City have still not found out how to stop the slide
tinued strength in non-gaming areas but the state of the economy and the increase in competition continued to hurt casino revenue last year. The hotels, the restaurants and the clubs are busy, a clear indication that Atlantic City continues to be a great place to visit. I am confident that as the economy improves, casino rev- enues will rebound.”
All 11 casinos saw a decline in
$2.48bn (E1.91bn), while table game revenues were down 10.9 per cent to $1.09bn (E839.3m).
NJCCC chairwoman Linda Kassekert said: “We have seen con-
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gaming revenues, although of varying amounts. Still by far the dominant venue in Atlantic City is Borgata, which saw GGR of $647.7m (E498.7m) in 2010, down 6.8 per cent on 2009, the second lowest drop recorded. Harrah’s Marina had the third lowest fall of 7.1 per cent to achieve GGR of $453.5m (E349.2m)
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making it the second largest resort by gaming turnover. The Tropicana, sixth in the rankings, saw the small- est fall of 4.2 per cent to post $330.4m (E254.4m).
At the other end of the scale, Resorts saw a 19 per cent fall putting it in tenth place with E155.2m (E119.5m). AC Hilton was down 14.8 per cent for a ninth place E163.6m (E126m). Trump Marina brought in $147.4m, down 9.3 per cent. A little hope shone in December 2010 at the Tropicana and the Trump Marina, however, as each posted an increase in monthly revenues: Trump Marina saw a one per cent up bump, while at Tropicana, the figure was up a full 8.5 per cent on December 2009 at $24.3m (E18.7m).
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the Rivers Casino, which saw slot revenue up 30 per cent to $19.7m (E15.2m) in the month. Parx Casino again saw the highest revenues of $28.7m (E22.1m), up 8.9 per cent on December 2009. December revenues for
table games are not available yet, however, from July when they became legal to Novem- ber GGR reached a total of $168.4m (E129.7m). The PGCB accounting
year runs from July to June, however in 2010 slot machines total revenues of $2.27bn (E1.75bn),
impressive rise of 15.8 per cent on 2009.
an
Pennsylvania
Parx Casino leads the pack in Pennsylvania
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