Shuffle Master reports record revenue but Q4 loss

Jan 20, 2009 5:02 PM
by Ray Poirier | Shuffle Master Inc. (SHFL) reported record revenue for the fourth fiscal quarter of 2008 but because of a goodwill impairment charge showed a diluted loss from continuing operations of $15 million or $0.28 per share.

In the comparable period last year, the company showed a profit of $8.1 million or $0.23 per share.

For the 12 months that ended on Oct. 31, 2008, the company showed a loss of $10.8 million compared to a profit of $16.3 million in 2007. This equated to a per share loss in 2008 of $0.27 per share whereas a year earlier the company reported a profit of $0.46 per share.

Revenues during the fourth quarter totaled $53.6 million, a 4% increase over the prior year and an 8% jump from the prior sequential quarter.

Analysts were looking for a profit of $0.08 per share on sales of $49 million.

Lease and service revenue reached $20.2 million, up 17% from the previous year while EBITDA (earnings before interest, taxes, depreciation and amortization) increased from $12 million to $13.9 million.

Commenting on the report, Coreen Sawdon, acting chief financial officer, said, "Overall, the fundamentals of our business are solid. We begin the new fiscal year with an exceptionally strong balance sheet, healthy cash flow generation, a low leverage ratio, and a continued emphasis on reducing our cost structure."

A pair of analysts expressed their pleasure over the company’s performance.

Steve Wieczinski of Stifel Nicolaus noted to clients that Shuffle Master actually had adjusted earnings of $0.12 per share, which surpassed both analysts’ estimates and his own forecast of $0.09 per share.

And Todd Eilers also expressed satisfaction with the company’s performance and maintained his "hold" rating on the shares.