Intuitively, this makes sense. When business is bad, cash flows decline, liquidity is a more pressing need, and suppliers cut back on slot capex. Operators do not immediately cut back on slot capex when their business turns down, nor do they immediately communicate to the suppliers that they are cutting back. Hence, the lag.
This relationship could be tested in the coming quarters. As discussed in my post “CAPEX, COVENANTS, AND CORPORATE CONTROL”, I expect corporate managements of the operators to direct slot capex lower in the first half of 2009 due to liquidity issues. Even if gaming trends improve sequentially, I anticipate slot purchases to be pushed back into the second half of the year.