Acres turns green with orders

November 20, 2001 9:01 AM
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Landing big orders from MGM Mirage and Station Casinos helped Acres Gaming boost its revenues this year. The contracts also helped the Las Vegas-based maker of games and player tracking systems stay on the Nasdaq stock list.

Acres’ roller-coaster year hit a big dip back on Feb. 4 when Nasdaq announced that failure to meet the board’s minimum threshold of $2 million in net tangible assets subjected the company to delisting. Then, just 17 days later, Station signed a $21.8 million order for Acres’ Advantage and Bonusing products for six casinos, including the upcoming Green Valley Station.

That deal, along with a $5.7 million order from MGM Mirage, not only kept Acres on the Nasdaq but sent its stock soaring to 52-week highs. Shares that had fetched just $1.125 in January were priced at $7.25 by May.

Acres’ gain was Casino Data Systems’ loss. Sources say glitches in Station’s CDS cashout system figured into the casino company’s decision to switch vendors.

“The system was taking 24 hours to remove points. And players were figuring that out (and cashing out again),’’ one source said.

MGM Mirage, meantime, was ordering an IGT-Acres slot accounting, player tracking and bonusing system for up to 11 properties.

The new deals revived Acres’ earnings this year. After posting record profits in the January-to-March period, the company’s earnings were up again in the quarter ending Sept. 30. Quarterly net income of $417,000 was a marked improvement over a $1.6 million loss the year before. Net revenue more than doubled to $6.1 million.

Chief executive Bud Glisson said Acres expects to add several new contracts in the coming months. He would not divulge the nature of those contracts, but predicted that earnings in the current fiscal year will be up “20 to 30 percent.’’

Last month, Acres announced a joint venture on a new line of bonus games with Bally Gaming. Acres will furnish game design and engineering and Bally will provide the manufacturing and distribution.

The initial agreement covers three models based on Bally Gaming’s S6000 spinning reel slot machine and Acres Bonusing Technology. The companies will share equally in the resulting profit, and additional models can be added in the future.