Interested parties may also access the conference call live on the Internet at http://ir.multimediagames.com/events.cfm. Approximately two hours after the call has concluded, an archived version of the webcast will be available for replay at the same location at http://ir.multimediagames.com/events.cfm.
About Multimedia Games Holding Company, Inc.
Through its wholly owned subsidiaries, Multimedia Games Holding Company, Inc. (“Multimedia Games”) develops and distributes gaming technology. The company is a creator and supplier of comprehensive systems, content and electronic gaming units for Native American gaming markets, as well as for commercial casinos and charity and international bingo markets. Revenue is primarily derived from gaming units in operation domestically and internationally installed on revenue-sharing arrangements. Multimedia Games also supplies the central determinant system for the video lottery terminals (“VLTs”) installed at racetracks in the State of New York. The company is focused on pursuing market expansion and new product development for Class II, Class III and VLT markets. Additional information may be found at www.multimediagames.com.
Cautionary Language
This press release contains forward-looking statements based on Multimedia Games' current expectations and projections, which are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. The words "believe", "will", "expect", "continue", "intend", "plan", "seek", "estimate", project", "may", or the negative or other variations thereof or comparable terminology as they relate to Multimedia Games and its products, plans, and markets are intended to identify such forward-looking statements. All forward-looking statements are based on current expectations and projections of future events.
These forward-looking statements reflect the current views, models, and assumptions of Multimedia Games, and are subject to various risks and uncertainties that cannot be predicted or qualified and could cause actual results in Multimedia Games' performance to differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, the ability of Multimedia Games to maintain strategic alliances, unit placements or installations, grow revenue, garner new market share, secure new licenses in new jurisdictions, successfully develop or place proprietary product, comply with regulations, or have its games approved by relevant jurisdictions. Other important risks and uncertainties that may affect the Company's business are detailed from time to time in the "Certain Risks" and "Risk Factors" sections of Multimedia Games' Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, and elsewhere in Multimedia Games' filings with the Securities and Exchange Commission. All forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. Readers are cautioned that all forward-looking statements speak only to the facts and circumstances present as of the date of this press release. Multimedia Games expressly disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
- financial tables follow -
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CONDENSED CONSOLIDATED BALANCE SHEETS As of December 31, 2011 and September 30, 2011 (In thousands, except share and per-share amounts) (Unaudited) |
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| December 31, | September 30, | |||||||
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ASSETS |
2011 | 2011 | ||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 53,745 | $ | 46,710 | ||||
|
Accounts receivable, net of allowance for doubtful accounts
|
15,360 | 16,004 | ||||||
| Inventory | 8,968 | 7,291 | ||||||
| Prepaid expenses and other | 3,936 | 5,300 | ||||||
| Current portion of notes receivable, net | 14,397 | 14,280 | ||||||
| Federal and state income tax receivable | 1,204 | 142 | ||||||
| Total current assets | 97,610 | 89,727 | ||||||
| Property and equipment and leased gaming equipment, net | 46,313 | 47,399 | ||||||
| Long-term portion of notes receivable, net | 7,885 | 10,449 | ||||||
| Intangible assets, net | 27,006 | 28,395 | ||||||
|
Value added tax receivable, net of allowance of $787 and $817,
|
2,878 | 2,787 | ||||||
| Other assets | 2,398 | 2,471 | ||||||
| Total assets | $ | 184,090 | $ | 181,228 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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| CURRENT LIABILITIES: | ||||||||
| Current portion of long-term debt | $ | 3,700 | $ | 3,700 | ||||
| Accounts payable and accrued liabilities | 22,170 | 25,855 | ||||||
| Deferred revenue | 1,518 | 1,131 | ||||||
| Total current liabilities | 27,388 | 30,686 | ||||||
| Long-term debt, less current portion | 32,375 | 33,300 | ||||||
| Other long-term liabilities | 657 | 679 | ||||||
| Deferred revenue, less current portion | 369 | 661 | ||||||
| Total liabilities | 60,789 | 65,326 | ||||||
| Stockholders’ equity: | ||||||||
| Preferred stock: | ||||||||
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Series A, $0.01 par value, 1,800,000 shares authorized,
|
— | — | ||||||
|
Series B, $0.01 par value, 200,000 shares authorized,
|
— | — | ||||||
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Common stock, $0.01 par value, 75,000,000 shares authorized,
|
352 | 346 | ||||||
| Additional paid-in capital | 98,709 | 95,063 | ||||||
|
Treasury stock, 8,120,278 and 7,727,457 common shares at cost,
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(62,048 | ) | (60,164 | ) | ||||
| Retained earnings | 86,891 | 81,109 | ||||||
| Accumulated other comprehensive loss, net | (603 | ) | (452 | ) | ||||
| Total stockholders’ equity | 123,301 | 115,902 | ||||||
| Total liabilities and stockholders’ equity | $ | 184,090 | $ | 181,228 | ||||
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended December 31, 2011 and 2010 (In thousands, except per-share amounts) (Unaudited) |
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Three Months Ended
December 31, |
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| 2011 | 2010 | |||||||
| REVENUES: | ||||||||
| Gaming operations | $ | 24,901 | $ | 21,995 | ||||
| Gaming equipment and system sales | 9,593 | 6,085 | ||||||
| Other | 301 | 527 | ||||||
| Total revenues | 34,795 | 28,607 | ||||||
| OPERATING COSTS AND EXPENSES: | ||||||||
| Cost of gaming operations revenue (1) | 2,015 | 1,938 | ||||||
| Cost of equipment and system sales | 4,158 | 3,248 | ||||||
| Selling, general and administrative expenses | 11,503 | 11,380 | ||||||
| Research and development | 3,634 | 3,196 | ||||||
| Amortization and depreciation | 9,690 | 9,988 | ||||||
| Total operating costs and expenses | 31,000 | 29,750 | ||||||
| Operating income (loss) | 3,795 | (1,143 | ) | |||||
| OTHER INCOME (EXPENSE): | ||||||||
| Interest income | 453 | 793 | ||||||
| Interest expense | (372 | ) | (835 | ) | ||||
| Other income (expense) | 919 | (89 | ) | |||||
| Income (loss) before income taxes | 4,795 | (1,274 | ) | |||||
| Income tax benefit (expense) | 987 | (100 | ) | |||||
| Net income (loss) | $ | 5,782 | $ | (1,374 | ) | |||
| Basic earnings (loss) per common share | $ | 0.21 | $ | (0.05 | ) | |||
| Diluted earnings (loss) per common share | $ | 0.21 | $ | (0.05 | ) | |||
| Shares used in earnings (loss) per common share: | ||||||||
| Basic | 27,265,844 | 27,649,184 | ||||||
| Diluted | 28,108,576 | 27,649,184 | ||||||
|
(1) |
Cost of revenues exclude depreciation and amortization of gaming equipment, content license rights and other depreciable assets, which are included separately in the amortization and depreciation line item. |
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Three Months Ended December 31, 2011 and 2010 |
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| 2011 | 2010 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | (In thousands) | |||||||
| Net income (loss) | $ | 5,782 | $ | (1,374 | ) | |||
|
Adjustments to reconcile net income (loss) to cash
|
||||||||
| Amortization and depreciation | 9,690 | 9,988 | ||||||
| Accretion of contract rights | 1,896 | 1,740 | ||||||
| Share-based compensation | 554 | 489 | ||||||
| Other non-cash items | 447 | 41 | ||||||
| Interest income from imputed interest | (418 | ) | (686 | ) | ||||
| Changes in operating assets and liabilities | (4,028 | ) | 2,575 | |||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 13,923 | 12,773 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
|
Acquisitions of property and equipment
|
(9,189 | ) | (9,264 | ) | ||||
| Transfer of leased gaming equipment to inventory | 1,177 | 122 | ||||||
| Acquisition of intangible assets | (1,404 | ) | (789 | ) | ||||
| Repayments under development agreements | 2,361 | 3,542 | ||||||
| NET CASH USED IN INVESTING ACTIVITIES | (7,055 | ) | (6,389 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
|
Proceeds from exercise of stock options,
|
3,098 | 575 | ||||||
| Principal payments of long-term debt | (925 | ) | (187 | ) | ||||
| Purchase of treasury stock | (1,884 | ) | (2,030 | ) | ||||
|
NET CASH PROVIDED BY (USED IN) FINANCING
|
289 | (1,642 | ) | |||||
|
EFFECT OF EXCHANGE RATES ON CASH AND
|
(122 | ) | (338 | ) | ||||
| Net increase in cash and cash equivalents | 7,035 | 4,404 | ||||||
| Cash and cash equivalents, beginning of period | 46,710 | 21,792 | ||||||
| Cash and cash equivalents, end of period | $ | 53,745 | $ | 26,196 | ||||
