Shuffle Master falls on disappointing Q3
Shuffle Master, Inc. (Nasdaq: SHFL), a maker of gambling-related products including automatic playing card shufflers and roulette chip sorters, announced after the closing bell that its third-quarter profit dwindled 63% to $2.7 million, or $0.08 a share, below analyst expectations of $0.13 per share and down from $7.3 million, or $0.20 per share, a year earlier.
Las Vegas-based Shuffle Master’s revenue for the three months ended July 31 was $45.1 million, slightly below Wall Street projections of $45.7 million and up more than 10% from $40.7 million in the year-ago period. Higher costs and expenses caused the lower quarterly profits. The company’s total costs and expenses for the quarter were $39 million, up 42% from $27.4 million a year earlier. Lease and royalty costs rose more than 58% to $4.6 million, from $2.9 million during the same three months of 2006.
The firm’s total number of installed shufflers increased 17% year-over-year to 24,572 units, from 21,001 units.
“To that point, we were pleased with our results as they underscored a material shift from selling to leasing in our utility and entertainment segments. We are also pleased to announce the reorganizing of our Las Vegas headquarters, including the formation of a corporate product group,” CEO Mark Yoseloff said in a statement. “This will better position Shuffle Master to centralize the Company’s worldwide product strategy, while fostering the product innovations that have continually transformed the industry.”
In after hours trading, shares of the small cap are nearing a 52-week low, down 10.04%, or $1.54, at $13.80. Over the last 52 weeks, shares have ranged from $13.53 to $32.82.
