AGEM releases May 2013 Index

Compared to a year ago, the AGEM Index is up by 49.12 points, or 41.5 %. In May, 10 of the global gaming equipment manufacturers reported increases in stock price when compared to the prior month, with all but two up by more than 5.0 %. Of the seven companies that witnessed declines, just three were down by more than 5.0 %.

The AGEM Index outperformed the broader stock markets in May. The Dow Jones Industrial Average ended the month at 15,115.57, representing a 1.9-% increase when compared to the prior month. The S&P 500 reported a slightly better performance, increasing 2.1 % month-to-month to 1,630.74. Meanwhile, NASDAQ witnessed the greatest increase of the three, rising 3.8 % to 3,455.91.

Selected positive contributors to the May 2013 AGEM Index included the following:

- Lottomatica (LTO) reported a stock price of EUR 20.79, up 7.4 %, and contributed 1.91 points.

- Konami (KNM) contributed 1.82 points due to a 7.8-% increase in stock price to us$24.47.

- With a stock price of us$ 17.88 (up 5.5 %) International Game Technology (IGT) contributed 1.69 points to the overall index.

Selected negative contributors included the following:

- Ainsworth Game Technology (AGI) reported a stock price of AUus$3.70, down 2.9 %, and diluted the index by 0.74 points.

- Global Cash Access (GCA) contributed negative 0.22 points, due to a 7.4-% decline in stock price to us$ 6.60 per share.

A number of the gaming equipment manufacturers reported top-line revenue growth in the three months ending March 31, 2013, suggesting continued expansion in the sector. Results for selected companies are noted below.

Bally Technologies (BYI) reported net revenues of us$ 259.1 million during the company's fiscal third quarter of 2013, up 13.3 % from the prior year period. Each of the major sources of revenue reported year-over-year increases. Gaming equipment revenues increased 8.2 % to us$85.8 million, due to an increase in domestic replacement sales. The average selling price of new gaming devices declined 6.0 % to us$16,051 during the quarter, but new-unit sales increased 18.7 % to 4,923. Gaming operations revenues increased 10.3 % year-over-year while systems revenues reported the greatest year-over-year increase, rising 25.5 % to us$71.3 million.

Net revenues for International Game Technology (IGT) were us$600.0 million during the company's fiscal second quarter of 2013, up 10.9 % compared to the second quarter of 2012. Although gaming operations revenues reported a year-over-year decline during the period (-4.4 %), strong increases in product sales and interactive revenues drove overall growth. Product sales revenues increased 15.9 % to us$279.0 million as a result of a 24.8-% increase in revenues in North America. Units shipped increased 36.2 % to 14,300, largely attributable to a 58.8-% increase in North American new units and a 68.0-% increase in North American replacement units. Average machine selling price declined 10.8 % to us$14,100, primarily due to increased promotional activity. Social gaming revenues increased 31.0 % quarter-to-quarter to us$54.3 million.

Multimedia Games (MGAM) reported net revenues of us$46.6 million during its fiscal second quarter of 2013, up 17.8 % from a year ago. Gaming operations revenues increased 15.0 % to us$33.4 million, while gaming equipment and system sales revenue increased 26.4 % to us$12.8 million. The latest performance is partially attributable to the sale of 580 new units during the period, up 22.9 % from a year ago. In addition, the company deployed over 1,000 new revenue units for the third consecutive quarter. The domestic participation installed base increased 18.4 % year-over-year to 11,712.

Net revenues for Wells-Gardner Electronics (WGA) increased 46.1 % during the company's fiscal first quarter of 2013 to us$18.0 million. The latest performance is attributable to an increase in VGT sales in Illinois, which resulted in a 55-% increase in sales to the gaming industry.