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Gaming Guru

Howard Stutz

Progressive Gaming profits slump

9 August 2007

LAS VEGAS, Nevada -- Progressive Gaming International has experienced a few road bumps while moving from a gambling device provider to a pure casino technology company.

Second-quarter earnings, reported Wednesday, were one of those challenges.

Las Vegas-based Progressive said its net loss for the period ended June 30 was $4.9 million, or 14 cents per share, which was an improvement over the company's net loss of $13.6 million, or 40 cents per share, a year ago.

The company is selling its table games division to Shuffle Master in a deal that's expected to close at the end of the month. Progressive classified the table games division and its remaining slot machine assets as discontinued operations. If those operations had been factored into the earnings, the company would have incurred an additional loss of $29.3 million, or 84 cents per share.

On the positive side, Progressive Gaming said its revenues from its systems division were $18.8 million, up 59.3 percent from with $11.8 million a year ago.

The company announced earnings after trading closed on the Nasdaq National Market. Progressive Gaming planned a conference call with analysts and investors for this morning. Progressive shares rose 71 cents, or 14.17 percent, Wednesday to close at $5.72.

Progressive CEO Russel McMeekin said the revenue rise reflected a positive movement in repositioning the company as a gaming systems supplier.

"Our ongoing progress in expanding our systems business is evidenced by the installed base growth of our products," McMeekin said.

Progressive reported a 5 percent quarter-over-quarter increase in a casino management system sales that was due to jump in interest from Asia and in European markets, including in the United Kingdom and Central Europe. The company said sales of its table game management product also grew during the same period, by almost 9 percent.

McMeekin said the sale of the table games division, which includes the Caribbean Stud game, will help reposition the company. No purchase price has been disclosed.