WMS YOUTUBE

In preparation for WMS's F2Q earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.

 

 

YOUTUBE FROM FQ1 CONFERENCE CALL

  • "The VLT market in Illinois opened, and we shipped our first 193 new units in the September quarter, and with the Gaming Control Board continuing to approve additional tavern locations, we expect to continue to ship more units in fiscal 2013 and into fiscal 2014."
  • "I have been to a dozen G2E shows. In all that time I have not observed WMS ever have had more positive customer response to our products than we had this year... The strength that I differentiate to our products and enthusiasm from our customer displayed reminds me of 2006 when we introduced a significant number of new game play technologies that have now become staples on slot floors, such as sound chairs, transmissive real technology and community gaming style games. Or 2008 when we launched the BLUEBIRD 2e cabinet with its, at that time, next generation CPU-NXT2 operating system."
  • "CPU-NXT3 operating system is already approved, and we've already submitted the Gamefield xD cabinet and is approved in some jurisdictions already. And that we expect to submit our exciting new Blade cabinet later this month. We anticipate shipping the first units of both these new unique cabinets which utilizes the CPU-NXT3 platform in the March quarter."
  • "My Poker product, which we expect to expand our footprint to a portion of casino floor that we not previously serviced, were launched this quarter at Station Casino in Las Vegas and in the March quarter, Caesars Entertainment Properties in seven regional markets."
  • "We continue to expect our ship share to new casino openings and the Illinois VLT market to average in the high teens"
  • "We expect the average selling price during fiscal 2013 to be more variable than in the past, and likely lower year-over-year due to the higher mix of lower-priced VLT units, particularly if Illinois VLTs become a greater portion of the unit mix."
  • "The improvement in our gaming content during the past year has resulted in higher than normal conversion kit sales over the last five quarters, and we expect this will continue at least through the launch of the Blade cabinet."
  • "With a total of 17 new participation games expected to launch over the balance of fiscal 2013, including CHEERS, a new Godfather theme and the KISS game in the current quarter, and SPIDER-MAN and WILLY WONKA & THE CHOCOLOTE FACTORY later in the year, coupled with the launch of the Gamefield xD cabinet with new MONOLOPY and WIZARD OF OZ games, and additional new games in both the March and June quarters, we expect our installed footprint will continue to grow throughout fiscal 2013 to drive further revenue growth."
  • "We also expect to see our average daily revenue improve in the second half of our current fiscal year. At the end of September 2012, about 70% of our installed base of gaming machines has been upgraded to new hardware and operating system platforms with just under 35% of the installed base having the latest games that were launched in the last three quarters."
  • "We intend to continue to increase our global staff of engineers, artists and game developers, leading to higher R&D expenses on a quarterly sequential basis. For the year-end total, we expect our R&D expenses to average 15% to 16% of total revenues, higher on a relative basis in the first half of the year, and lower on a relative basis in the back half, as we expect revenues to accelerate."
  • "In fiscal 2013, the total incremental increase in planned R&D, depreciation and amortization and selling and admin expenses for our interactive products and services is anticipated to be in a range of $30 million to $35 million. We expect the non-marketing expense amounts to ramp slightly every quarter throughout the year, largely reflecting additional head count to support additional revenue growth.  We expect marketing costs in the December quarter to increase more significantly on a quarterly sequential basis as we moved past the launch phase Jackpot Party Social Casino, and expect that marketing costs will then level out thereafter at levels more akin to industry standards in a range of 30% to 40% of Jackpot Party Social Casino revenues."
  • "Revenues are expected to grow modestly from the September 2012 quarter to the December 2012 quarter, and to slightly exceed those reported in the December 2011 quarter. However, lower margin VLTs are expected to exceed 25% of new units sold this quarter, resulting in product sales margin declining to a range of 48% to 49%, and operating income is expected to be slightly lower than the September 2012 quarter, reflecting an incremental cost to support interactive products and services."
  • "On an annual basis, benefits from our higher revenues this year will be offset by planned higher spending to support new product flow and the building of a foundation for our interactive products and services."
  • "Our first rollout of a fully managed B2B real money online casino site will be in collaboration with Groupe Partouche in Belgium, utilizing our jackpotparty.com platform and operating infrastructure. We anticipate beginning with a soft launch later this quarter with full go live in January 2013." 
  • "Our B2B managed services provides casino operators with a full suite of products, games and platform and both front end and back office to services, such as marketing, operations, IT and payment services. We'll earn a negotiated revenue share from Groupe Partouche and the other B2B managed services contracts we expect to enter into."
  • "We recently announced deals with two customers Betsson and Unibet that have an aggregate more than 12 million registered players. This is essentially a content licensing revenue model where we earn a revenue share every time an online player uses a WMS or Jadestone game on one of our customer's sites, enabling us to broadly distribute our content and games through leading online operators in Europe.  We expect to go live with the initial WMS games early in calendar 2013. A key milestone will be for us to reach agreements with additional online gaming operators with whom interest has been very high."
  • "Early last month, the Play4Fun Network went live with our first installation for the Meskwaki Bingo Casino in Iowa... We're paid an initial integration fee by our casino operator partners at launch and we also see recurring monthly management fees."
  • "Jackpot Party social casino that we launched on Facebook at the beginning of July.... for the quarter, we averaged just over $55,000 in net daily revenue to WMS, and a monetization level that is better than most of our competitors in this space... today, our daily revenue is tracking more than 50% higher than our first quarter average daily rate."
  • "We currently expect to generate $35 million to $40 million in interactive revenues in fiscal 2013 at attractive gross margins, and as you can see in the September quarter, we generated $9.5 million of revenue."
  • "I think the regional operating budgets...are pretty much flat year-over-year. There might be some little bit of an uptick, maybe I would say 3% to 5%." 
  • "We're going to be putting more WAP product out there and that drives a higher yield"

Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

read more

7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more