Gaming Strategy
Featured Stories
Legal News Financial News Casino Opening and Remodeling News Gaming Industry Executives Search News Subscribe
Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter!
Search Our Archive of Gaming Articles 

Autotote Reports Results for Transition Period

15 February 2001

NEW YORK – (Press Release) -- Feb. 15, 2001 – Autotote Corporation (Amex: TTE) today announced results for the two-month transition (the ``stub'') period from November 1, 2000 to December 31, 2000 in accordance with the company's decision to change its fiscal year to a calendar year from an October 31st year end. The results for the current period include the operations of Scientific Games Holdings Corp. since September 6, 2000, the date it was acquired by Autotote.

Revenues for the transition period in 2000 were $66.6 million compared to $30.2 million in the corresponding two-month period in 1999. EBITDA (earnings before interest, taxes, depreciation and amortization) for the transition period was $11.6 million in the stub period versus $5.1 million in the corresponding period in the previous year.

These results for the stub period include severance reserves of $1.0 million in our pari-mutuel business. The net loss available to common shareholders for the stub period was $6.1 million (after a non-cash charge of $1.1 million of paid-in-kind preferred stock dividends) or $0.15 per share compared to a net loss of $1.1 million or $0.03 per share in the same period of the prior year.

On a pro forma basis, comparing the two months ended December 31, 2000 with the two months ended December 1999, including Scientific Games for the 1999 period, revenues were $66.6 million versus $71.0 million in the same period in the prior year. Services revenue increased to $57.6 million from $54.8 million and sales revenue was $9.0 million compared to $16.2 million.

Sales revenue includes an expected reduction in non-recurring equipment sales from $10.4 million in the same period in the prior year to $1.8 million in the stub period together with an increase in secure telecommunication printed products from $5.6 million to $7.2 million in the stub period. EBITDA was $12.6 million before severance reserves in our pari-mutuel business of $1.0 million in the stub period compared to $13.1 million in the comparable period of the prior year.

The decline in EBITDA is more than accounted for by the anticipated reduction in one-time equipment sales and the temporary reduction in instant ticket production capacity attendant to the closure of the Gilroy, CA printing facility.

Lorne Weil, Chairman and Chief Executive Officer of Autotote, commented, ``Although these transition period results are especially difficult to interpret, they reflect continued growth in our core businesses, excluding non-recurring equipment sales. As we said in our year-end report, the various cost reduction programs we put in place in 2000 will have a very positive impact on our results going forward and we are now beginning to see the benefits. We believe that a number of factors should allow us to attain an EBITDA level of at least $100 million in 2001 and to continue to expand our penetration in the lottery and pari-mutuel businesses.''

``Having improved production at Scientific Games, the business of Scientific Games on a standalone basis went from $5.5 million of EBITDA in the third calendar quarter of 2000 to $13.5 million of EBITDA in the fourth calendar quarter of 2000. The new lottery press is reducing costs in our lottery operations and capacity is returning to the levels we attained before we closed our Gilroy operations.

"Our backlog extends well into our second quarter as retail sales of US instant tickets exceed expectations and we grow internationally. We expect our increased production capacity throughout the year should enable us to take advantage of these and other opportunities, including an opportunity to provide instant tickets in Italy with Lottomatica. Our on-line lottery service business is up due to the New Hampshire and Vermont on-line lotteries installed last July and we are preparing to install the Iowa and Maine on-line lotteries this July.''

``Even though November and December have historically been the seasonally weakest two months of the year, revenues in both our pari-mutuel services and venue management businesses have grown. Revenue is up in our North American pari-mutuel service business, where we have since announced price increases, as well as in our North American simulcasting and in our NASRIN(TM) service businesses.

"In addition, we reduced overhead and headcount in our North American pari-mutuel business and plan to consolidate our European pari-mutuel operations. Our venue management business increased 7% in the stub period compared to the same period in the prior year principally due to growth in handle at our Connecticut OTBs. Recent legislation in the United States may enable inter-state pari-mutuel wagering by electronic means, including the Internet, between jurisdictions in which such wagering is legal. We plan to introduce, our proprietary horseracing information Website, and to introduce an Internet-based wagering product to be used in such jurisdictions.''

``Our United Kingdom-based telecommunications products business grew 28% in the stub period compared on a pro forma basis to the same period in the prior year, despite the strengthened dollar, as we continued to win new customers and unit sales increased from the growth in pre-paid cellular services. Our plant investments last summer significantly increased our capacity and continue to reduce our operating costs.''

< Gaming News