July 29, 2014 - 3:58 pm
Slot machine maker International Game Technology said Tuesday it grew profits in the third quarter despite a double-digit decline in revenue.
The Las Vegas-based manufacturing giant is being sold to lottery provider GTECH Holdings for $6.4 billion. Because of the pending transaction, which is expected to close next year, IGT did not hold a conference call to discuss the results for the quarter that ended June 30.
During the quarter, IGT collected $467.6 million in revenue, a 19 percent decrease from the same quarter of the 2013.
Net income, however, grew 10 percent to $72.1 million, which translated into earnings of 29 cents per share. A year ago, IGT had net income of $65.7 million and earnings of 25 cents per share.
In a statement, IGT CEO Patti Hart said the profit increases were the result of “effective cost management” that “improved efficiencies in a challenging industry environment and has positioned us for future market opportunities.”
IGT collected $218 million in revenue from gaming operations — the slot machine division in which the company shares in the money produced with casinos — a 12 percent decrease over the same quarter last year. In slot machine sales, IGT saw a 36 percent decrease to $167 million.
But IGT’s interactive gaming division increased revenue 15 percent to $83.1 million, primarily because of DoubleDown Casino, a social gaming website that also operates through Facebook.
IGT said the company’s social gaming arm boosted revenue 31 percent to $205 million in the first nine months of the fiscal year.
Nearly a month after all but announcing it was up for sale, IGT was bought by GTECH for $4.7 billion in cash and stock, and assumption of $1.7 billion in debt.
GTECH shareholders will own 80 percent of the new company, which will be listed on New York Stock Exchange when the deal closes next year. The De Agostini Group, which owns 59 percent of GTECH, will have 47 percent of the new company.
“As we have stated before, we believe the sale to GTECH is the correct move for IGT and shareholders we believe the company got a fair price considering the market environment and competitive dynamics,” Eilers Research founder Todd Eilers told investors.
Shares of IGT closed at $17.11 on the New York Stock Exchange, down 5 cents or 0.29 percent.
Contact reporter Howard Stutz at firstname.lastname@example.org or 702-477-3871. Follow @howardstutz on Twitter.