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Casino Data Systems Reports Record Quarterly Earnings

For the quarter, the Company posted revenue of $20.6 million, its second highest third quarter total, compared with $20.0 million for the same prior year quarter.

The Company reported quarterly operating income of $4.3 million, the highest ever for a third quarter and the second highest operating income in any quarter in the Company's history. That represents an increase of $1.8 million or 70% compared to the $2.6 million reported in prior year's third quarter.

This increase was primarily driven by increases in the Company's gross margin due to sales mix and design and manufacturing efficiencies in the Company's Games division.

Gross margin percentage for the quarter improved to 59% as compared to 51% reported in prior year's third quarter. Net income increased 70% quarter over quarter from $1.8 million, or $.10 per basic and diluted share, to $3.1 million, or $.17 per basic and $.16 per diluted share.

The Company posted its second highest revenue for a nine-month period ending September 30 at $57.6 million. Revenue for prior year's comparable period of $58.5 million remains the highest ever posted by the Company.

Nine-month operating income was $11.0 million, an increase of 115% over the $5.1 million reported for the first nine months of the prior year. Gross margin percentage for the first nine months of fiscal 2000 increased to 58% from 47% for the prior year period. Nine-month net income of $7.8 million, or $.41 per diluted share, increased 98% from $4.0 million, or $.21 per diluted share, for the prior year period.

The Company also reported the following highlights from its September 30, 2000 balance sheet:

No long term-debt

Unrestricted cash and investments of $18.1 million

Net working capital of $63.3 million

Total assets of $117.6 million

Steve Weiss, Chairman and Chief Executive Officer stated, ``With this quarter, we have completed three of the strongest quarters in our history. Operating and net income for the first nine months of this year have already surpassed any full year's performance. In addition to these financial accomplishments, we have made several significant engineering advancements.

"At the upcoming World Gaming Congress and Exposition trade show, we will unveil our new multimedia gaming device named Q-Slot(TM), the most powerful and secure gaming platform in the industry. Q-Slot utilizes our patented Bandit(TM) technology and will be offered to our customers under revolutionary new business terms that we expect will increase Bandit's market penetration and recurring revenue streams.

"Over that same time, our OASIS(TM) systems business developed and commercialized the most robust feature set offered in any casino management system and became the first to offer a large scale ticket solution on equipment from multiple gaming device manufacturers. These advancements in our games and OASIS systems businesses combined with our robust financial situation, have our Company in its strongest position ever.''

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