In preparation for BYI's FQ4 2013 earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.
(see our SHFL/BYI CONF CALL NOTES on 07/16/2013)
GAMING OPERATIONS
- "The margin on Gaming Operations was 71%, within our expected range of 68% to 73%."
WAP
- "All things considered, we expect to see the rate of WAP unit increases to pick up during the upcoming quarters...We expect the flow of WAP and premium game titles to continue in a steady well-planned and controlled fashion."
SHARE BUYBACK/ASR
- "Just the subject alone that since November 2007, including the ASR we're doing now, we bought back $1 billion. No change in our capital allocation strategy. We think that using an ASR to basically pull in about 7.5% of our total market cap is a pretty efficient means to do that. We do have some additional powder available even during the period of the ASR, should we choose to put that to work."
NORTH AMERICAN REPLACEMENT VOLUME
- "When I think about average order size, it's gone up a touch. I would say that's more a result of some corporate buying."
INTERNATIONAL GAME SALES
- "Because regardless of whether their replacement numbers increase or not, one thing is certain, we are very under-represented in those floors. So we have a lot of market share growth opportunities there, even if the overall replacement trends don't pick up. So we have a long way to go before we are worried about the overall macro (international) trends."
- "Some of the new game content we've been working on for the past year specifically targeted towards various international regions will be released soon and should help grow this portion of our business during fiscal 2014 and beyond."
SYSTEMS
- "We are heading towards fiscal 2013 being a record Systems revenue year for us, beating the previous record of $218 million established in fiscal 2010 by a fair amount. We have every reason to believe fiscal 2014 will be even better."
- [Software/hardware split] "I believe it was somewhere around 36% hardware, so not too dramatically different from the prior quarter and from the year-ago quarter. Looking into Q4, hardware might be a lower, slightly lower percentage of the overall total revenue; software might be a little bit higher...And that is reflected in the normal expectation of gross margin that we say, in the 70%s is the range our gross margin will normally be, give or take a couple of percentage points here and there."
I-GAMING
- "We also made very good progress on the remote gaming server front, going live with eight Bally titles on multiple European portals this past week. We expect over a dozen such portals to launch Bally's world-class game content by the end of this fiscal year."
NASCAR
- "And in terms of our expectations of NASCAR, yes, it is along the lines of Michael Jackson and GREASE, if not better."
ASP
- "If you remove the VGTs and the VLTs our pricing is along the same lines as it has been for the last couple of quarters. In fact, pretty close to the highest levels it's been. We remain very disciplined with pricing."
CANADA & SOUTH AFRICA
- "Canada and South Africa, I mean, it's a 2014 story. It's a 2015 story. It could even beyond 2015 be a story. There's still more to come on Canada, more jurisdictions that I think ultimately will come to market."
OTHER
- "We expect that our income tax rate for the fourth quarter will approximate 36.5%."
- "From a bad debt perspective, we've been relatively consistent."
