Former AGA President, CEO Geoff Freeman joins AGS board

Former American Gaming Association President and CEO Geoff Freeman is joining the board of directors of Las Vegas gaming equipment manufacturer AGS.

The company on Friday announced the addition of Freeman, who stepped down from the AGA position in August to become the president and CEO of the Grocery Manufacturers Association, as an independent director.

The appointment was announced the day after AGS reported mixed results in its third-quarter earnings. The company reported record revenue for the quarter, but missed analysts’ earnings expectations.

For the quarter that ended Sept. 30, AGS reported net income of $4.3 million, 12 cents a share, on revenue of $75.5 million — nearly a 34 percent increase over the same quarter a year earlier. That reversed a loss of of $4.1 million, 18 cents a share, on revenue of $56.4 million in 2017.

“The upside to revenue came from record level slot machine sales driven by new markets in Alberta, the new Orion Slant cabinets and a large corporate order,” said Todd Eilers, principal for California-based Eilers & Krejcik.

“The company’s top-line trends remain strong and we anticipate margins to improve in 2019,” Eilers said. “We currently forecast AGS to generate $307 million in revenue and $148 million in cash flow in calendar year 2019.”

AGS sold a company record 1,332 electronic gaming machines, primarily to tribal casino customers in Canada, for the quarter — a 58 percent jump over last year.

Las Vegas-based Union Gaming had only forecast the company to sell 900 machines for the quarter.

“Entering new jurisdictions continues to be a key company-specific catalyst for AGS, with 24 percent of (machines) sold in the quarter going to Canadian provinces,” Union Gaming analyst John DeCree said in a note to investors. “AGS is also reporting double-digit shipshare in many early-entry markets like Mississippi and Louisiana.”

AGS shares fell $2.99, 12.5 percent, to $21.01 a share on trading nearly twice the average daily volume.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.