Elixir Gaming Technologies Inc (EGT, Financial) filed Quarterly Report for the period ended 2009-06-30.
Vendingdata Corp is a Las Vegas-based developer manufacturer and distributor of products for the gaming industry including the SecureDrop System Deck-Checker and Random Ejection Shuffler line. Their products are currently installed in casinos throughout the United States including Caesars Palace Circus Circus Harrah\'s Entertainment Luxor Oneida Bingo & Casino and the Venetian. International customers include casinos in Argentina China Columbia Korea Malaysia Peru United Kingdom and Uruguay. Elixir Gaming Technologies Inc has a market cap of $25.2 million; its shares were traded at around $0.22 with and P/S ratio of 2.1.
As a result of our efforts, our financial performance has improved materially during the three-month and six-month periods ended June 30, 2009. Our consolidated revenues for the three-month and six-month periods ended June 30, 2009 were $5.8 million and $7.5 million, of which revenue from our gaming machine participation operations, our primary business, comprised 30% and 36%, respectively of our total revenues. This compares to $3.3 million and $5.7 million for the respective periods in 2008, of which revenue from our gaming machine participation operations comprised 23% and 23%, respectively, of our total revenues.
Operating loss from continuing operations declined $7,219,539 to $2,206,216 for the three-month period ended June 30, 2009 compared to an operating loss of $9,425,755 in the same period in the prior year primarily as a result of higher gross profits and significantly reduced operating expenses. Net loss from continuing operations declined $7,707,060 to $1,892,521 compared to a net loss of $9,599,581 for the same period in the prior year due to reductions in the operating loss, a gain resulting from the settlement of the legacy lawsuit, a foreign currency exchange gain compared to a loss in the prior year period, and reduced interest expense, all of which were partly offset by higher income tax expense compared to a benefit in the prior year period and a loss on the disposition of assets compared to no effect from the disposition of assets in the prior year period.
Gross loss increased $215,240 to $1,859,006 for the six-month period ended June 30, 2009 compared to a gross loss of $1,643,766 in the same period the prior year primarily as a result of lower gross margin for our gaming machine participation and non-gaming products operations, partially offset by a higher gross margin for our table game products operations. Table game products gross margin improved primarily due to production efficiencies resulting from a large RFID gaming chip order delivered during the period ended June 30, 2009. Revenues from gaming machine participation increased, but have yet to cover the cost of depreciation during the start up period.
Our gross loss from gaming machine participation operations decreased $584,146 to $856,684 for the three-month period ended June 30, 2009 compared to a gross loss of $1,440,830 for the same period in 2008 as revenue from gaming machine participation increased disproportionately greater than depreciation expenses for our gaming machine participation operations. However, revenues have yet to cover the cost of machine depreciation, which is recorded in cost of operations. Our cost of goods sold for the three-month period ended June 30, 2009 included $2,425,220 depreciation of electronic gaming machines and $174,528 of other expenses.
Our gross loss from gaming machine participation operations increased $710,985 to $3,021,399 for the six-month period ended June 30, 2009 compared to a gross loss of $2,310,414 for the same period in 2008 as cost of goods sold increased at a greater rate than revenues due to higher depreciation expense, higher gaming machine operating costs, and the write-down of gaming assets during the first quarter of 2009. Our cost of goods sold for the six-month period ended June 30, 2009 included $4,815,685 depreciation of electronic gaming machines and $515,532 of other expenses and $378,980 in write-downs of gaming assets.
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Vendingdata Corp is a Las Vegas-based developer manufacturer and distributor of products for the gaming industry including the SecureDrop System Deck-Checker and Random Ejection Shuffler line. Their products are currently installed in casinos throughout the United States including Caesars Palace Circus Circus Harrah\'s Entertainment Luxor Oneida Bingo & Casino and the Venetian. International customers include casinos in Argentina China Columbia Korea Malaysia Peru United Kingdom and Uruguay. Elixir Gaming Technologies Inc has a market cap of $25.2 million; its shares were traded at around $0.22 with and P/S ratio of 2.1.
Highlight of Business Operations:
On March 16, 2009, we entered into a Purchase and Settlement Agreement with Shuffle Master, Inc. (the Purchase and Settlement Agreement) pursuant to which we sold to Shuffle Master our portfolio of automated card verification machines and electronic card shuffling systems, all related intellectual property, and certain inventory of such products and settled all outstanding litigation between Shuffle Master and the Company, which traced back to October 5, 2004. The total consideration paid by Shuffle Master was $2.8 million, of which $2.4 million was received in March 2009 and $400,000 was received in April 2009. In relation to this Purchase and Settlement Agreement, we have terminated a distributorship arrangement of the relevant products with our distributor in Europe. Pursuant to the termination arrangement, we are required to buy back certain inventory of the relevant products kept by the distributor. After taking into account of such buy-back obligation, we recognized a gain relating to the asset disposal of approximately $1.71 million in the second quarter 2009. As a result of the transactions under the Purchase and Settlement Agreement, which were completed in April 2009, the China facility became redundant and, therefore, was closed at the end of April 2009. At March 31, 2009, we incurred a restructuring charge of $29,416 relating to the write-down of the remaining plant equipment. We believe that the above transaction provided significant financial benefits to us as it improved our cash position and frees resources to focus on addressing market opportunities that further our strategy of expanding our core electronic gaming machine participation business.As a result of our efforts, our financial performance has improved materially during the three-month and six-month periods ended June 30, 2009. Our consolidated revenues for the three-month and six-month periods ended June 30, 2009 were $5.8 million and $7.5 million, of which revenue from our gaming machine participation operations, our primary business, comprised 30% and 36%, respectively of our total revenues. This compares to $3.3 million and $5.7 million for the respective periods in 2008, of which revenue from our gaming machine participation operations comprised 23% and 23%, respectively, of our total revenues.
Operating loss from continuing operations declined $7,219,539 to $2,206,216 for the three-month period ended June 30, 2009 compared to an operating loss of $9,425,755 in the same period in the prior year primarily as a result of higher gross profits and significantly reduced operating expenses. Net loss from continuing operations declined $7,707,060 to $1,892,521 compared to a net loss of $9,599,581 for the same period in the prior year due to reductions in the operating loss, a gain resulting from the settlement of the legacy lawsuit, a foreign currency exchange gain compared to a loss in the prior year period, and reduced interest expense, all of which were partly offset by higher income tax expense compared to a benefit in the prior year period and a loss on the disposition of assets compared to no effect from the disposition of assets in the prior year period.
Gross loss increased $215,240 to $1,859,006 for the six-month period ended June 30, 2009 compared to a gross loss of $1,643,766 in the same period the prior year primarily as a result of lower gross margin for our gaming machine participation and non-gaming products operations, partially offset by a higher gross margin for our table game products operations. Table game products gross margin improved primarily due to production efficiencies resulting from a large RFID gaming chip order delivered during the period ended June 30, 2009. Revenues from gaming machine participation increased, but have yet to cover the cost of depreciation during the start up period.
Our gross loss from gaming machine participation operations decreased $584,146 to $856,684 for the three-month period ended June 30, 2009 compared to a gross loss of $1,440,830 for the same period in 2008 as revenue from gaming machine participation increased disproportionately greater than depreciation expenses for our gaming machine participation operations. However, revenues have yet to cover the cost of machine depreciation, which is recorded in cost of operations. Our cost of goods sold for the three-month period ended June 30, 2009 included $2,425,220 depreciation of electronic gaming machines and $174,528 of other expenses.
Our gross loss from gaming machine participation operations increased $710,985 to $3,021,399 for the six-month period ended June 30, 2009 compared to a gross loss of $2,310,414 for the same period in 2008 as cost of goods sold increased at a greater rate than revenues due to higher depreciation expense, higher gaming machine operating costs, and the write-down of gaming assets during the first quarter of 2009. Our cost of goods sold for the six-month period ended June 30, 2009 included $4,815,685 depreciation of electronic gaming machines and $515,532 of other expenses and $378,980 in write-downs of gaming assets.
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