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US – AGEM posts modest increase in June

By - 18 July 2016

The AGEM Index posted a modest increase in June 2016 after gaining 28.83 points in May 2016.

The composite index stood at 260.01 at the close of the month, which represents an increase of 4.67 points, or 1.83 percent, when compared to May 2016. The AGEM Index reported a year-over-year increase for the eighth consecutive month, rising 67.7 points, or 35.2 percent, when compared to June 2015. During the latest period, 11 of the 14 global gaming equipment manufacturers reported month-to-month drops in stock price, with five down by more than 10 percent. Of the three manufacturers reporting increases in stock price during the month, one was up by more than 10 percent.

The broader stock markets reported mixed results in June 2016 largely due the recent British exit from the European Union, which has rattled international and domestic markets. The S&P 500 reported a month-to-month increase of 0.1 percent, rising to 2,098.96. Additionally, the Dow Jones Industrial Average increased 0.8 percent to 17,929.99. NASDAQ decreased 2.2 percent during the period, falling to 4,827.67.

Aristocrat reported a stock price of AU$13.80 (up 7.3 per cent) and contributed 8.25 points. With a stock price of $0.31 (up 19.2 per cent), Galaxy Gaming contributed 0.03 points.

Gaming Partners International (GPIC) contributed 0.03 points due to a 3.2 per cent increase in stock price to $9.30.

With a stock price of $6.25 (down 21.6 per cent), Daktronics contributed negative 0.47 points. International Gaming Technology (IGT) contributed negative 0.52 points due to a 1.2 per cent decline in stock price to $18.74. Ainsworth Game Technology reported a stock price of AU$2.16 (10 per cent) and contributed negative 0.46.

Gaming Partners International Corporation (GPIC) reported total revenue of $16.1m  in the first quarter of 2016, which represents a decrease of 13.7 percent compared to the same quarter in the previous year. Revenues were softer due to a decline in casino openings and expansions along with manufacturing constraints in GPIC’s playing card operation.

In April of 2016, GPIC wrote a letter of intent to acquire Dolphin Products Limited for an estimated cash price of $5.9m. Dolphin is a manufacturer and distributor of RFID and traditional gaming chips for major casinos in Asia and Australia.

Agilysys (AGYS) reported fiscal year 2016 revenues of $120m, up 16.3 per cent over the prior year. Hardware replacement sales and new logo hardware sales helped drive a 30.1 per cent increase in product revenue. Revenue from support, maintenance and subscription services increased 7.3 per cent while professional services revenue increased 20.2 percent.

Ainsworth Game Technology (AGI) reported revenue for the six months ending December 2015 of AU$141.9m, which represents a gain of 26.8 percent over the same period of the prior year. Ainsworth’s revenue increases were predominantly in the American market, which now represents 58 percent of Ainsworth’s business compared to 39 per cent in the same period of last year. Ainsworth reported 1,445 units under gaming operation in North America with AU$43m in revenue, which represented an increase of 18 per cent and 42 percent, respectively.

Aristocrat (ALL) reported net sales of AU$938.3 million on a constant currency basis in the first half of 2016, which is a 37-percent increase from the first half of 2015. Aristocrat’s installed base of Class III premium games increased 26 percent to 11,613 units, which helped drive revenues in the Americas. Digital revenue doubled in constant currency terms with the continued rise of daily active users on the iPad and Android platforms. In the first half of 2015, digital revenue comprised 8.4 percent of Aristocrat’s total segment revenue. In 2016, digital revenue now compromises 13 per cent of that figure.

In addition to past performances, many gaming equipment suppliers are keeping an eye on the possibility of a ballot initiative in Nebraska to authorize gaming. Recent reports suggest a group, Keep the Money in Nebraska, is obtaining resident signatures within the Cornhusker State to find its way to the ballot.


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