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Mikohn posts strong results

Apr 2, 2002 9:48 AM

Mikohn Gaming on Monday reported strong financial results for the fourth quarter and fiscal year ended December 31.

Revenue for the fourth quarter increased 29 percent to $31.3 million compared to the prior year’s fourth quarter, and revenues for fiscal year 2001 grew 10.2 percent to $111.1 million, compared to $100.8 million the previous year.

Adjusted EBITDA (earnings before deductions for interest, taxes, depreciation, amortization, slot rent expense, and unusual items) increased to $7.7 million in the fourth quarter from a negative $504,000 a year earlier, and totaled $30.6 million for fiscal 2001, up 65 percent from $18.6 million in 2000.

Helping to fuel the profit increases were a strong growth in the company’s gaming operations segment, including a 33.3 percent increase in the recurring revenue from their installed base of licensed brand slot games.

“Mikohn’s financial position has improved with strong cash flow from operations, as well as cash and cash equivalent balances exceeding $16 million and an available credit line of $17.5 million to support our growth,” said David Thompson, president and CEO. “In addition, we have lowered corporate expense and labor costs as a result of tight expense control measures put into effect after 9-11. Employee headcount has been reduced by 14 percent from last year at this time. Based on all these factors, we are comfortable at this time with analyst estimates for the current year ending December 31, 2002 in the fifty cent per share range.”

Thompson added that in the fourth quarter, the company placed 120 licensed brand slot games and ended 2001 with an installed base of 2,679 units, an increase of 670 for the year.

In the fourth quarter, slot win per day, net of royalties, was $28, an increase on a year-over-year basis from $25 in the same period a year ago, but lower on a sequential basis than the third quarter’s $32.

“Going forward, we expect that win per day in each of the first three quarters will be higher on a seasonal basis than in the fourth quarter,” Thompson said. He emphasized that Mikohn’s business outlook for the coming year is “very positive” based on several factors, including:

”¡ New slot games based on Clue and Trivial Pursuit, plus refreshed versions of Yahtzee, Battleship and Ripley’s Believe It or Not.

”¡ Expansion of sales opportunities in new jurisdictions.

”¡ A significant increase in MoneyTime slot placements.

”¡ New table game opportunities in Nevada and elsewhere.

”¡ A resurgence of systems business in Canada, Europe and Australia.

”¡ Greatly increased customer interest in TableLink, Mikohn’s table game monitoring system.