Bally Technologies Profit Tops Estimates - Update

(RTTNews) - Gaming company Bally Technologies Inc. (BYI), Thursday reported a better-than-expected increase in fourth-quarter profit, helped by an eight percent growth in revenues and improved gross margins. The company reiterated its guidance for fiscal year 2014, indicating growth prospects to be bright.

Bally makes video machines and provides casino management, interactive applications, and server-based systems for the gaming industry.

The Las Vegas, Nevada-based company posted a fourth-quarter net profit of $37 million or $0.95 per share, compared with $26.5 million or $0.61 per share last year.

Results for the prior-year quarter included loss contingency accrual, net of tax , of $0.17 per share, excluding which, earnings would have been $0.78 per share.

On average, 15 analysts polled by Thomson Reuters expected the company to earn $0.94 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the fourth quarter grew to $264 million from $246 in the prior year. Analysts expected revenues of $256.36 million for the quarter.

Gaming operations revenue climbed 10 percent year-over-year, and systems revenue was up 32 percent. Gaming equipment revenue slid 8 percent, with average selling price of new gaming devices down 6 percent.

The fiscal year 2013 was a momentous period for the company, with robust growth in gaming operations revenue, success in new markets like Canada, Illinois, and South Africa, said CEO Ramesh Srinivasan.

Srinivasan said that the planned $1.3 billion acquisition of SHFL entertainment will posit the company in the end-to-end gaming solutions space.

Results for the quarter were also helped by gross margin that improved to 65 percent from 62 percent last year, and operating margin to 24 percent from 20 percent.

For fiscal 2014, Bally continues to expect earnings of $3.70 to $4.05 per share, while analysts expect $3.43 per share.

In July, Bally agreed to acquire gambling equipment maker SHFL Entertainment Inc. (SHFL) for about $1.3 billion. The deal is to be accretive to Bally's earnings per share in the first year after completion.

The company's stock closed Thursday at $73.19, down $1.43 or 1.92%, on a volume of 566 thousand shares on the NYSE.