Shuffle Master’s net income rises 71 percent

Gaming equipment provider Shuffle Master Inc. grew its net income 71 percent in the fourth quarter, thanks partly to increased revenues from leasing casino products and the sale of electronic table games to racetrack casinos in New York.

Shuffle Master, which is based in Las Vegas, on Tuesday reported net income of $9.7 million, or 18 cents per share, in the quarter ended Oct. 31, compared with net income of $5.7 million, or 10 cents per share, a year earlier.

The latest results beat the Capital IQ consensus estimate of 17 cents per share, briefing.com noted.

Revenues increased 12.1 percent to $65.7 million from $58.6 million.

Shuffle Master Chief Executive Officer Gavin Isaacs said every financial metric for the company during the quarter broke a record.

"It's important to view these results not only as a testament to past performance, but also as a benchmark for our future," Isaacs said. "By continuing to raise our expectations and our efforts, we believe we will ensure the best days for this company are the ones that lie ahead."

Lease revenue for the company's automated card shufflers and other casino equipment grew 13 percent during the quarter, while leasing of table games, such as Three Card Poker, grew 12 percent.

Shuffle Master said lease revenues for electronic table games grew 9 percent, predominantly due to new lease placements of it Vegas Star games in New York. Electronic table games are classified as slot machines by New York gaming regulators and can be used inside the state's slot machine-only casinos.

Roth Capital Markets gaming analyst Todd Eilers said Shuffle Master is expected to pick up additional revenues in the coming quarters as casinos nationwide and internationally look to upgrade their automated card shuffling systems.

"We remain positive on Shuffle Master shares ... with the further adoption of electronic table games and pickup in new casino openings in both domestic and international markets," Eilers said.

Shuffle Master said it ended fiscal year 2011 with debt of $17.1 million, the company's lowest figure since 2003, and $39.2 million lower than the end of fiscal year 2010.

Shuffle Master shares rose 4 cents, or 0.37 percent, Tuesday to close at $10.72 on the Nasdaq Global Select Market.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.
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