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Autotote Reports 1st Quarter 2001 Results

23 April 2001

NEW YORK -- April 23, 2001 – (Press Release) -- AUTOTOTE CORPORATION (Amex: TTE) today announced results for the first quarter ended March 31, 2001 that exceeded expectations.

In addition, Autotote announced that it would change its corporate name to Scientific Games Corporation and its stock exchange symbol to SGM (Amex: SGM ) effective April 27, 2001.

Revenues for the first quarter of 2001 were $112.1 million compared to $45.6 million for the comparable period in fiscal 2000. EBITDA (earnings before interest, taxes, depreciation and amortization) was $24.7 million in the first quarter of 2001 versus $10.5 million for the comparable period in 2000. The net loss before non-cash preferred stock dividends was $2.4 million or $0.06 per share compared to net income of $0.8 million or $0.02 per share in the first quarter of 2000.

On a pro forma basis to reflect the September 2000 acquisition of Scientific Games, first quarter revenue was $112.1 million compared to $104.7 million for the comparable period in 2000, an increase of 7.1%. EBITDA increased by 15.4% to $24.7 million from $21.4 million. Pro forma net income before the non-cash preferred stock dividends and amortization of goodwill and other acquisition-related intangible assets was $1.2 million in the first quarter of 2001 or $0.03 per fully diluted share.

Lorne Weil, Chairman and CEO of Autotote, commented, ``Our change of name from Autotote Corporation to Scientific Games Corporation reflects our feeling that the latter more accurately and completely describes the breadth of products and services we offer to the global gaming industry. At the same time we will continue to operate in the worldwide pari-mutuel industry under the Autotote name.''

Mr. Weil continued, ``I am pleased to report that our first quarter was a very strong one, as expected, across all our businesses. Since we acquired Scientific Games, we have indicated that the process of combining and integrating Autotote and Scientific Games in the latter part of 2000 would obscure the true financial potential of the company. We forecasted that the underlying earnings power of the combined businesses would begin to become clear in the first calendar quarter of 2001. We are pleased that this has indeed come to pass. With revenue of $112.1 million and EBITDA of $24.7 million in the quarter, we believe we are on track to deliver an excellent year, in line with our expectations at the time of the acquisition.''

``Pari-mutuel, venue management and lottery systems all contributed to the improvement. On-line lottery sales and EBITDA approximately doubled reflecting the continued expansion of this line of business. Printed products revenues were still slightly below our longer-term target but the Alpharetta facility was up to 3.3 billion tickets in the first quarter, from 2.9 billion in the fourth quarter of 2000. Revenue and earnings in prepaid cellular phone cards continue to expand and we have great expectations for this early stage business.''

``We believe that our two core marketplaces -- lottery and pari-mutuel wagering -- will continue to be resistant to economic downturns as they have consistently demonstrated in the past. US instant lottery retail sales were $16.2 billion in 2000, an increase of approximately 10%, on-line lottery sales were $19.1 billion in 2000 and thoroughbred racing handle, about $15 billion last year, continues to grow about 6% annually, with ''remote`` wagering growing at roughly double that rate. So our primary markets are in excellent shape overall and we intend to continue to pursue strategies intended to enlarge both the size of the markets themselves as well as our roles within them.''

"Among important first quarter details were the following:

-- As mentioned previously, on-line lottery sales in the first quarter were nearly twice last year's level reflecting the addition of both New Hampshire and Vermont in 2000. Later this year we can look forward to adding two more lotteries in Maine and Iowa, as well as the Jamaica Lottery Corp, with whom we recently signed a sales and facilities management contract.

-- Instant ticket shipments have grown steadily in line with increasing production levels, and we anticipate these trends to continue in coming quarters. At the same time we are seeing especially strong demand in our instant ticket Cooperative Services group, reflecting the overall strength in the ticket market as well as the effectiveness of our own service offering.

-- In addition to revenue growth, our pari-mutuel group is experiencing significant benefit from cost reduction programs initiated in 2000; the latter impact has been particularly pronounced in the communications business where our move to 8 to 1 compression has doubled its EBITDA.

-- By means of a facilities management revenue sharing arrangement, the Fair Grounds' Race Course in New Orleans launched its Internet wagering site using the Company's TrackPlay wagering platform, and acceptance by the players has been very strong. To the extent more enabling legislation is passed in the US and abroad, we expect to apply this business model widely throughout our customer base."


Autotote noted that it continues to expect strong double-digit growth in its on-line lottery group as two new systems come on line in Maine and Iowa and business remains strong in its other states. Printed products income should grow modestly as the new press approaches maximum run rates that will continue to lower production costs. The company also expects somewhat higher but single-digit revenue growth in the pari-mutuel and venue management segments in the second and third quarters - the height of the racing season. Prepaid cellular phone cards, which are approximately 10% of total revenues, are expected to continue to gain ground as cellular phone use climbs. For 2001, Autotote confirmed that it looks forward to revenues of approximately $400-450 million and EBITDA of $100-105 million. The company also stated that it expects to have pro forma net income before non-cash preferred stock dividends and excluding amortization of goodwill and other acquisition-related intangible assets in each of the next three quarters.

About Autotote

AUTOTOTE CORPORATION is the leading integrated supplier of instant tickets, systems and services to lotteries, and the leading supplier of wagering systems and services to pari-mutuel operators. It is also a licensed pari-mutuel gaming operator in Connecticut, Holland and Germany and a major supplier of prepaid cellular phone cards to telephone companies. Autotote's customers are in the United States and more than 60 other countries.

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