Participation was up and sales were down at WMS Industries last quarter. The Waukegan, Ill., game maker enjoyed a 30 percent increase in leasing but that was swamped by a $13.5 million reduction in sales revenue.
Proceeds from sales decreased 48 percent as unit sales fell to 2,050 units for the quarter ending Sept. 30, a period the company said is historically its weakest. Net income was $5.8 million (18 cents per diluted share), compared with $9.5 million (30 cents per diluted share) a year ago.
“Notwithstanding the first quarter financial results, we recently participated in two trade shows in Las Vegas which were met with strong responses from industry sources,” stated Brian Gamache, WMS president and CEO.
To bolster the bottom line, WMS announced it secured the exclusive worldwide rights from NBC and Groucho Marx Productions to develop, manufacture and market games based on the TV game show “You Bet Your Life.” WMS also obtained licensing rights from Universal Studios to develop slot machines based on director Alfred Hitchcock and his feature films, “The Birds,” “Saboteur,” “Vertigo” and “Psycho.”
Gamache said lower-than-normal results were a carryover from “software anomalies” in the previous quarter. He said WMS experienced no cancellations or holds placed on sales orders as a result of the Sept. 11 attacks. The average sales price for gaming devices was $8,352, slightly above year-ago levels.
The average daily revenue per machine decreased to $40.18 from $45.38 a year ago. The decrease primarily reflects the incremental expansion of games, lower play levels, as well as lower daily revenues on participation games in Nevada and other jurisdictions after Terror Tuesday.
“Nevada-based casino operators are re-assessing their capital spending and leasing plans” in the wake of the 9-11 attacks, Gamache said. “This reassessment may continue to impact game sales volume and participation revenues, although only 13 percent of WMS’ game unit sales and 21 percent of total participation revenues in fiscal 2001 were from casinos in Nevada.”
WMS and its marketing partner, Harrah’s Entertainment, delayed the launch of the new “Hollywood Squares” participation game in Nevada from September until December when weekly casino patronage is expected to be higher.
WMS also recently received Nevada approval for “Party Train,” the ninth game in the Monopoly series, and began placements in casinos this month. The current backlog of customer requests for participation gaming devices is over 500 units and the company expects that number to grow even further now that it is taking orders for “Survivor” and “Hollywood Squares.”