Gaming supply company Shuffle Master, Inc. (SHFL) said Wednesday after the markets closed that its third quarter profit rose 87% from last year, as lower costs and expenses more than offset a 9% revenue drop.
The Las Vegas, Nevada-based company reported net income for the third quarter of $5.6 million or $0.10 per share, compared to $3.0 million or $0.08 per share for the year-ago quarter.
The number of weighted average diluted shares outstanding during the third quarter was 53.58 million, compared to 35.95 million in the third quarter of last year.
On average, 7 analysts polled by Thomson Reuters expected the company to earn $0.07 per share for the third quarter. Analysts' estimates typically exclude special items.
Operating income for the third quarter increased 24% to $8.7 million from $7.0 million a year earlier.
Total costs and expenses for the quarter fell 14% to $36.4 million from $42.5 million last year. Selling, general and administrative expenses decreased 19% year-over-year to $14.2 million.
Interest expenses for the quarter declined 37% to $1.04 million from $1.64 million in the prior year quarter.
Total revenue for the third quarter fell 9% to $45.07 million from $49.49 million in the same quarter last year. Six analysts had a consensus revenue estimate of $45.15 million for the third quarter.
However, total lease, royalty and service revenue for the quarter rose 4% from last year to a record $21.0 million and comprised 47% of total revenue.
Tim Parrott, Shuffle Master's Chief Executive Officer, said, "We are continuing to see the real impact on our bottom line of specific cost containment measures initiated earlier this year and are confident that regional expansions, new openings in Asia, increased momentum in the shuffler replacement cycle and the i-Table rollout this fall are all milestones on the path toward future top line improvements as well."
The company appointed Linster Fox as its chief financial officer, effective August 1. He most recently served as CFO of Cherokee International LLC.
For the first nine months of its fiscal year, the company reported net income of $9.2 million or $0.17 per share, compared to $4.2 million or $0.12 per share for the same period last year.
Total revenue for the nine-month period fell 8% to $124.86 million from $136.39 million in the prior year period.
Among others in the industry, International Game Technology (IGT) in July reported a 39% drop in its third quarter profit, reflecting the on-going effects of difficult global economic conditions that have impacted both gaming operators and casino patrons.
Shuffle Master shares, which have traded in a range of $1.97 to $7.85 over the past year, closed Wednesday's regular trading session at $7.69, up 16 cents or 2.12%. The stock is currently gaining 30 cents or 3.90% in after hours trading.
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