International edition
September 19, 2020

For the fiscal year, net income was us$ 342.5 million

IGT reports fourth quarter and fiscal year 2008 results

(US).- International Game Technology announced operating results for the fourth quarter and fiscal year ended September 30, 2008. Net income for the quarter was us$ 52.1 million, inclusive of a non-cash charge of us$ 28.6 million.

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or the fiscal year, net income was us$ 342.5 million compared to us$ 508.2 million in the same period last year. Comparability for the quarter and fiscal year periods is affected by a number of items.

"Our fiscal 2008 results reflect challenging economic operating conditions affecting our customers and in turn our business," said Chairman and CEO TJ Matthews. "Despite these challenges, we remained focused on key business initiatives. During 2008, IGT released several new models on our Advanced Video Platform (AVP) and released close to 700 game titles worldwide across all platforms. We made significant progress in the development of our server-based gaming initiatives and will begin commercially deploying initial versions of this technology in 2009."

Fourth quarter gaming operations revenues and gross profit from gaming operations totaled us$ 331 million and us$ 192.7 million, respectively, compared to us$ 353.3 million and us$ 214.7 million for the same quarter last year. For the year ended September 30, 2008, revenues and gross profit from gaming operations totaled us$ 1.3 billion and us$ 778.1 million, respectively, compared to us$ 1.4 billion and us$ 823 million in the prior year.

For the current quarter and fiscal year, gross margins on gaming operations were 58% compared to 61% and 60%, respectively, in the prior year. The current quarter was primarily affected by lower play levels.

As of September 30, 2008, gaming operations installed base totaled 60,500 units, an increase of 400 units from the immediately preceding quarter and the prior year quarter. Installed base growth in international markets and domestic lottery markets was partially offset by reductions in Florida and California Class II markets as these markets transitioned to Class III for-sale games.

Approximately 74% of the installed base is comprised of variable fee games that earn a percentage of machine play levels rather than a fixed daily fee.

Worldwide product sales generated fourth quarter gross profit of us$ 161.7 million compared to us$ 161 million in the prior year. Non-machine revenues comprised 31% of total product sales versus 38% in the comparable prior year quarter. Domestic shipments increased due to the release of their new AVP models in the fourth quarter. Internationally, lower shipments into Japan compared to the prior year quarter were partially offset by increased shipments into Latin America.

For the fiscal year ended September 30, 2008, worldwide product sales generated gross profit of us$ 641 million versus us$ 657.8 million in the prior year, reflecting a reduction in machine revenues due to continued slow domestic replacement demand and lower Japan sales. Non-machine revenues comprised 33% of total product sales for fiscal 2008 compared to 30% of total product sales in the prior year. The increase in non-machine revenues was driven by increased intellectual property licensing fees and systems sales.

For the fiscal year ended last September 30, IGT generated us$ 516.3 million in cash from operations on net income of us$ 342.5 million compared to us$ 821.5 million on net income of us$ 508.2 million in the prior year period. Besides, working capital increased to us$ 733.4 million at September 30, 2008 compared to us$ 595.5 million at September 30, 2007. Cash equivalents and short-term investments totaled us$ 374.4 million at September 30, 2008 versus us$ 400.7 million at September 30, 2007. Debt totaled us$ 2.3 billion at September 30, 2008 compared to us$ 1.5 billion at September 30, 2007. The available capacity on its us$ 2.5 billion line of credit totaled us$ 1.2 billion as of September 30, 2008.

During the fourth quarter, IGT repurchased 11.6 million shares at an aggregate cost of us$ 268.8 million. For the fiscal year, share repurchases totaled 25.5 million shares at an aggregate cost of us$ 779.7 million. The remaining authorization under the company’s stock repurchase program totaled 7.7 million shares at September 30, 2008.

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