Bally Technologies reported its third quarter results

“We are pleased with our operational and financial positioning for the future,” said Richard M. Haddrill, the Company’s CEO. “While current industry conditions remain challenging, we have a number of opportunities, both domestic and international, that are attractive and exciting for the Company. Additionally, the early acceptance of our new Pro Series cabinets has been excellent, and we continue to be pleased with the strength of our gaming operations business.”

“Since the beginning of fiscal 2011, we purchased over two million of our shares for approximately US$ 76 million,” said Neil Davidson, the Company’s CFO. “On April 6, 2011, the Board approved a share-repurchase program increase to US$ 550 million, less amounts tendered in the recently launched modified ‘Dutch auction’ of up to US$ 400 million. We believe that our financial initiatives positively complement our business operations and further our commitment to creating long-term value for stockholders.”

“We continue to be delighted by the strength in our gaming operations business, with another all-time revenue record set in the third quarter,” said Ramesh Srinivasan, the Company’s President and COO.

“Bally placed more than 550 Vegas Hits games during the quarter, making Vegas Hits second only to Cash Spin as the fastest premium game release in the Company’s history. Our Systems backlog, pipeline, and win-loss ratio levels also remain strong, despite disappointing weakness in year-to-date revenues.

 Our recent Systems Users Conference held last month, where we demonstrated our leading-edge systems products live on a customer’s casino floor, has generated significant interest in our Systems products, especially our iVIEW DM and Elite Bonusing Suite applications.”

Highlights of Certain Results for the Three Months Ended March 31, 2011

•Selling, general and administrative expenses ("SG&A") increased to 30 % of total revenues as compared with 28 % last year, primarily due to increases in payroll, legal, and other expenses to support new markets.

•Research and development expenses ("R&D") increased to 12 % of total revenues as compared with 11 % last year.

•Operating margin increased to 20 % as compared with 18 % last year.

•Adjusted EBITDA from continuing operations (earnings before interest, taxes, depreciation, and amortization, including asset impairment charges and share-based compensation), a non-GAAP financial measure, decreased to US$ 61 million as compared with US$ 67 million last year.

•Diluted EPS from continuing operations increased to US$ 0.43 from US$ 0.36 last year. The prior year included an impairment charge of US$ 0.13 per diluted share related to Alabama charitable bingo assets.

•ASP of new gaming devices increased by 11 % to US$ 15,556 per unit from US$ 13,979 last year, primarily as a result of product mix, including sales of Pro Series cabinets.

•New gaming device sales decreased to 3,417 units as compared with 4,571 units last year due to fewer international units sold during the quarter and a continued sluggish North America replacement market.

•New-unit sales to international customers were 29 % of total new-unit shipments, as compared with 46 % last year.

•Gross margin decreased to 43 % from 51 % last year due to higher costs for the initial production runs of the Pro Series cabinets as well as write-downs related to older technology platforms.

•Revenues increased 15 % to an all-time record US$ 80 million as compared with US$ 70 million last year, driven by placements of new premium games throughout the quarter and the performance of our lottery systems installed base.

•Gross margin increased to 74 % from 72 % in the same period last year primarily due to lower jackpot expenses.

Systems

•Revenues were US$ 47 million, up 2 % compared to second quarter fiscal 2011, and lower when compared with US$ 52 million last year, as a result of fewer large new implementations during the quarter.

•Gross margin increased to 77 % from 75 % in the same period last year primarily as a result of the change in mix of products sold and an increase in maintenance revenues. Specifically, hardware sales were 34 % of Systems revenues, and software and service sales were 31 %, as compared to 36 % for hardware and 35 % for software and services in the same period last year.

•Maintenance revenues increased to a record US$ 16 million as compared with US$ 15 million last year.