EGT swings back to profit in Q3 as revenue surges

Entertainment Gaming Asia swung to a profit in Q3 on higher revenue, as growth in its Cambodian gaming operations and an order from a new casino in Macau helped to offset a weaker performance in the Philippines.

The company reported net income of $1.4 million, or $0.10 per share, on a weighted average diluted share count of 14.5 million shares for the third quarter of 2015. This compared to a net loss of $261,000, or $0.04 per share, on a weighted average diluted share count of 7.5 million shares for the third quarter of 2014.

Revenue was $8.3 million, an increase of 88 percent compared to $4.4 million in the third quarter of 2014 due to increases in both the gaming operations and gaming products business divisions. Analyst estimates weren’t available.

“Our gaming products business benefited from strong sales and production volumes for gaming chips and plaques for both a new casino opening and from existing customers, as well as increased sales of other high-margin third-party gaming products,” chairman and CEO Clarence Chung said. “With an attractive fourth quarter order pipeline, the gaming products division is on target to achieve record performance of over $13 million in revenue for 2015. However, looking further ahead, we expect to experience sales fluctuations due to the natural uneven order flow for this business driven by the timing of orders for new casino openings.”

Gaming operations revenue was $4.5 million for the third quarter of 2015, an increase of 13 percent compared to $4.0 million in the third quarter of 2014. Average consolidated daily net win per unit was $120 for the third quarter of 2015, an increase of 20 percent compared to $100 in the third quarter of 2014.

The daily net win per unit in Cambodia was $152, up 33 percent, helped mainly by greater VIP traffic at NagaWorld.

However, the win in the Philippines was down 18 percent to $59 due to increased competition from new casino openings.

Revenue from gaming products was $3.8 million for the third quarter of 2015 compared to $437,000 in the third quarter of 2014, boosted by a $2.2 million order from a new Macau casino.