GPI reports 2012 fourth-quarter and year results

These results compare to revenues of us$ 14.6 million and net income of us$ 0.6 million, for the fourth quarter of 2011. Gross profit for the quarter was us$ 6.6 million, or 38% of revenues, compared to us$ 4.4 million, or 30% of revenues, in the prior year's fourth quarter.

For the full year 2012, the company recorded revenues of us$ 62.9 million and net income of us$ 6.1 million. These results compare to revenues of us$ 61.1 million and net income of us$ 3.7 million, or us$ 0.45 per basic and diluted share for the year 2011. Gross profit for 2012 was us$ 22.5 million, an increase of us$ 2.1 million, or 10.6%, compared to gross profit of $20.4 million for 2011. As a percentage of revenues, gross profit increased from 33.3% to 35.8%, primarily due to a shift in sales mix toward higher margin Paulson chips in the Americas during 2012, offset by a decrease in sales of European-style casino chips to Asia Pacific casinos in 2012, compared to 2011, which resulted in fixed manufacturing costs being allocated over lower production volumes in these products.

The primary reasons for the increase in revenue in 2012 were an increase of us$ 6.3 million in sales of American-style chips in the United States, primarily driven by sales of Paulson chips to casinos opening in Ohio, New Jersey, and Maine; and a us$ 1.8 million increase in sales of furniture, accessories, table layouts, and cards to new and expanding casinos in the United States. This increase was offset by a us$ 5.9 million decrease in sales of European-style casino chips for Asia Pacific casinos compared to sales in 2011, which were driven primarily by significant sales to the Galaxy Macau and Sociedade de Jogos de Macau casinos in 2011; and a us$ 0.8 million decrease in sales of RFID solutions to casinos in Asia Pacific, primarily related to the May 2011 Galaxy Macau opening.

In December 2012, the company paid a cash dividend of us$ 1.48 million, and at December 31, 2012, had us$ 27.6 million in cash, cash equivalents and marketable securities.

In November 2012, the firm's Board of Directors increased the number of shares authorized under the company's stock repurchase program to 400,000 shares, an increase of 88,561 shares. The company purchased 54,600 shares after the November 30, 2012 authorization, leaving 345,400 shares available for repurchase as of December 31, 2012. Since the inception of the original stock repurchase program on December 1, 2011 and through March 13, 2013, the company has repurchased 240,652 shares at a total cost of us$ 1,726,382.
"We had a strong fourth quarter, with more than us$ 17 million in revenues, driven by sales in both the United States and Asia," commented Greg Gronau, GPIC President and CEO. "For the full year, revenues were up slightly from our successful sales year in 2011, but earnings increased substantially as improvements in gross margin due to cost reductions and reduction in our global effective tax rate drove more of our revenue to the bottom line. We also increased our commitment to and spending for research and development with a focus on meeting customer requirements for increased security options for casino currency and the development of a new chip currency that combines features of our European and American chips into a brand new jeton-like chip. We delivered our first order of this new currency in the first quarter of 2013. This continuing commitment to product development will allow us to keep pace with the changing needs of our customers."