GTECH has blow out quarter

Sep 17, 2002 6:45 AM

Shares in lottery giant GTECH Holdings Corp. (GTK) rose nearly 20% Friday following a teleconference during which the company reported a huge jump in net income for the second quarter ended on Aug. 24.

Net income was nearly $18.2 million compared to last year’s $16.6 million. On a per share basis, this year’s net amounted to $0.66 per share compared to 2001’s $0.30 per diluted share.

The company’s second quarter earnings easily beat a Thomson-First Call consensus estimate of $0.47, as well as the company’s earlier projections of $0.46 to $0.50 a share.

Reporting for the company, newly-named CEO, Bruce Turner, credited the income increases with a 56% jump in product margins and a 57% decline in interest expense.

As for the remainder of the fiscal year that ends on Feb. 22, 2003, Turner said the service revenue should grow at about twice the rate previously predicted in June. The company now expects full year earnings to be between $2.10 and $2.20. And product sales for next year should be between $90 million and $110 million, he said.

Following the announcement, GTECH Holdings shares were near record level on the trading floor of the N.Y. Stock Exchange with 4.7 million shares changing hands. The closing price was $24.02, up $3.76 for the day.