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In preparation for WMS's FY Q2 2011 earnings release tomorrow, we've put together some forward-looking commentary from the company's FY Q1 2011 conference call and subsequent conferences.

YOUTUBE

  • “While standing at the threshold of entirely new revenue streams from our suite of Networked Game Enablement Portal applications and online gaming, we still see meaningful opportunities to grow our revenues, earnings and cash flow.”
  • “Our full-year guidance for fiscal 2011… underscores our expectation that we will continue to achieve top and bottom line growth throughout our fiscal year in the face of the continued impact from the slow replacement cycle, consumer uncertainly leading to no real increase in discretionary spending and our current expectation for the delay in the opening of the Illinois VLT market until fiscal ‘12.”
  • “I sense an improving sentiment among gaming operators. We’re seeing continuing willingness by the large multi-site operators to invest in the future and freshen their floors by increasing the size and breadth of their orders with WMS, large orders that would have been fulfilled over several quarters and that cover both new unit sales and recurring revenues in gaming operations.”
  • “In total, Bluebird xD and Bluebird2 cabinets accounted for 90% of our total global unit shipments, with Bluebird xD cabinets totaling almost 1,900 units or a healthy 35% of total global shipments.”
  • “Penn’s new Maryland casino are not in our September quarter shipments, but should be in the December 2010 quarter”
  • “Overall, higher shipments into the international markets we entered in fiscal 2010, Mexico and New South Wales, Australia, more than offset ongoing weakness in Europe.”
  • “We also experienced the meaningful increase in other product sales revenues, up 7 million or 47% from the prior year. The increase was led by significantly higher used gaming machine revenue and higher hardware and software conversion revenues.”
  • “Our daily average revenue per gaming machine was down slightly, both on a year-over-year and quarterly sequential basis, mostly reflecting the impact of lower consumer discretionary spending and the launch of new web products focused primarily at refreshing our footprint not expanding during the September 2010 quarter.”
  • “Our initial Bluebird xD gross margins were lower than the targeted launch goal. We have identified significant opportunities to improve the xD gross margin through cost reductions and supply chain efficiencies and we have a plan in place to accomplish this throughout the balance of fiscal 2011. We expect to reach margin parity between the Bluebird xD and Bluebird2 cabinets in the June 2011 quarter, even as we anticipate raising the bar by improving the margin on the Bluebird2 cabinet during the same period” 
  • “We expect depreciation to increase in total dollar expense over each of the remaining quarters in fiscal 2011, as we invest capital to continue to transition our gaming operations base from Bluebird to Bluebird2 units, place our first units into the new Italian VLT market and selectively invest in other high-return lease opportunities.”
  • Guidance:
    • “Annual… revenues of 830 million to 850 million.”
    • “For the December 2010 quarter, we expect to generate revenues of 198 million to 205 million, which would represent 5% to 9% increase over the prior-year quarter and approximately 23% to 25% of our total expected annual revenues.”
    • “We expect revenues for the first half to be 45% to 47% of our annual revenues, which is consistent with the initial overall revenue guidance that we provided of 44% to 48% of the fiscal year’s revenues being generated in the first half.”
    • “We sold approximately 1,250 gaming machines for new casino openings and expansions in the December quarter last year. In the December quarter this year, there are far fewer expansions and new openings.”
    • “We continue to see an acceleration of revenues in the second half as a result of the commercial launch of our WAGE-NET networked game enablement portal applications and online gaming business in the U.K.; ongoing penetration in the Mexico, New South Wales and Class II markets; market share growth in both domestic and international markets; and our entry into the Italy VLT market.”
    • “We expect to see operating margin improve on a quarterly sequential basis throughout fiscal 2011 and for the December quarter, we expect operating margin to improve over the September quarter to a range of 19% to 19.5%.”
    • “For the year, we are maintaining our operating margin guidance of 22.5% to 23%.”
  • “Upon receiving final regulatory approval by GLI, projected to be later this quarter, we expect to begin earning revenues from this product at the beginning of next quarter. The momentum will continue with the launch of PiggyBankin’, the second theme in the Ultra Hit Progressive portal family, followed by PENG-WINS, the first theme in the second portal family called Winners Share.”
  • “Our fiscal 2011 revenue guidance assumes only very modest revenues from our new online business. And consistent with our prior comments, our margin guidance anticipates running at a small loss”
  • “Recently launched in July, we already have nearly 500 of THE LORD OF THE RINGS games installed in more than 150 casinos”
  • “Near-term, as a result of the already identified cost reductions from proving the Bluebird xD cabinet, we expect to achieve our targeted run rate of a 55% product sales margin beyond the next few quarters, even without the benefit of an improving replacement cycle.”
  • “We’ve got four WAPs coming out in the Q2 and Q3, which will really drive second half revenues for the year.”
  • “The order size is still in the, call it, 15 to 18, Joe; it’s in that ballpark, so the order size hasn’t really by market or by quarter or year-over-year has not changed a whole lot. We’re having to work harder for the same results … Class II is maybe a little bit bigger because it’s a new market for us and we’re entering the floors for the first time, but not significantly bigger than those numbers.”