Profits surge for WMS Industries

CHICAGO -- Chicago-based slot machine maker WMS Industries continued its financial comeback Tuesday, saying its earnings jumped 67 percent in the fourth quarter 47 percent for the fiscal year.

The company said it had a 35 percent year-over-year boost in new slot machine shipments, which fueled an increase in both revenues and cash flow.

"With investments in next-generation technologies, a global organization of development studios and financial resources further strengthened by the record fiscal 2007 results, we established a solid base from which we expect to deliver consistent operating execution in fiscal 2008 and beyond," WMS President and CEO Brian Gamache said in a statement.

The gaming equipment provider has re-emerged in the past few years as its earnings sagged.

WMS reported net income of $16.7 million, or 29 cents a share, in the quarter ended June 30, up from $10 million, or 18 cents a share, a year earlier. Analysts polled by Thomson Financial predicted fourth-quarter earnings of 28 cents a share.

For the year, WMS said its net income was $48.9 million or 86 cents per share.

Company revenues were $158 million in the quarter, a 28.8 percent increase compared with $122.7 million in the same quarter a year ago. Twelve-month revenues were $539.8 million, a 19.6 percent increase from $451.2 million in 2006.

WMS said it sold 7,555 slot machines in the quarter and 25,613 in all of fiscal 2007.

The company announced earnings after trading on the New York Stock Exchange ended. Shares in WMS finished down 92 cents or 3.37 percent to close at $26.37. Some analysts thought the price, which was as high as $31 a share in June, could entice investors.

"Shares of WMS, like most of the gaming sector, have seen significant declines in July," Morgan Joseph gaming analyst Adam Steinberg said in a note to investors before earnings were announced. "We believe that a strong quarter, combined with higher guidance, could boost WMS. We view the recent lows as an opportunity for investors to establish a position in one of the leading gaming technology companies."