GPI reports financial results for 2Q and first 2012 semester

During the second quarter of 2012, the company posted revenues of us$ 13 million and net income of us$ 1.8 million. These results compare to revenues of us$ 14.8 million and net income of us$ 0.9 million for the second quarter of 2011. Gross profit for the second quarter of 2012 was us$ 4.7 million, or 36% of revenues, compared to us$ 4.8 million, or 32% of revenues, for the prior year quarter.

The decrease in revenue for the second quarter of 2012, compared to the same prior year period, was due to a us$ 1.9 million decrease in sales of European-style casino chips for Asian casinos related to significant sales in the second quarter of 2011 to the Galaxy and Sociedade de Jogos de Macau casinos in Macau, a us$ 0.8 million decrease in sales of RFID solutions to casinos in Asia primarily related to the May 2011 Galaxy Macau opening, offset by a us$ 0.6 million increase in sales of American-style chips in the United States, particularly by sales of Paulson chips to casinos opening in New Jersey and Ohio.

The increase in net income for the second quarter of 2012, compared to the same prior year period, is primarily driven by a reduction in general and administrative expenses due to the settlement of certain litigation and a reduction in  income taxes from the utilization of foreign tax credits, offset, in part, by slightly lower gross profit.

During the first six months of 2012, the company posted revenues of us$ 28.5 million and net income of us$ 3.1 million. These results compare to revenues of us$ 32.6 million and net income of us$ 2.6 million for the first six months of 2011. Gross profit for the first six months of 2012 was us$ 10 million, or 35% of revenues, compared to us$ 11.1 million, or 34% of revenues, for the first six months of 2011.

The decrease in revenue for the first six months of 2012, compared to the same prior year period, was due primarily to a us$ 7.8 million decrease in sales of European-style casino chips for Asian casinos related to significant chip and RFID solutions sales in the first six months of 2011 to Macau casinos, offset by a us$ 2.2 million increase in sales of American-style chips in the United States, primarily driven by sales of Paulson chips to casinos opening in New Jersey, Ohio, and Maine, and a us$ 1.4 million increase in sales of furniture, accessories, table layouts, and cards to new and expanding casinos in the United States.

The increase in net income for the first six months of 2012, compared to the same prior year period, is primarily driven by a reduction in general and administrative expenses due to the settlement of certain litigation and a reduction in income taxes from the utilization of foreign tax credits offset, in part, by lower gross profit.

The company ended the quarter with us$ 25.7 million in cash, cash equivalents and marketable securities and no debt.

"As stated above, our net income for the second quarter and first six months of 2012 were higher, compared to 2011, with diluted earnings of us$ 0.22 and us$ 0.38, respectively," commented Greg Gronau, GPIC President and CEO. "While our worldwide sales were down to us$ 28.5 million for the first six months of the year, with our existing backlog of signed replacement and expansion orders and other potential sales, particularly in Asia, we believe that we will have stronger revenue performance in the second half of the year."