Galaxy Gaming joined its casino-industry peers in basking in the post-COVID-shutdown rebound, posting second-quarter earnings that reversed a year-earlier loss and a jump in revenue and cash flow.
In a statement Monday, the Las Vegas casino table-games and systems developer, manufacturer, and distributor said its second-quarter net income was $550,000, or 3 cents per diluted share, for the three months ended June 30, reversing a year-earlier loss of $2.2 million, or 12 cents per diluted share.
Adjusted earnings before interest, taxes, depreciation and amortization, a cash-flow measure that excludes one-time costs, surged to a positive $2.1 million from a negative $1.4 million a year earlier. The latest adjusted EBITDA figure includes $80,000 in expenses related to continuing litigation with Triangulum Partners LLC. A year earlier, Triangulum lawsuit expenses totaled $480,085.
On May 7, 2019, Galaxy redeemed all 23.3 million shares of common stock held by Triangulum Partners, a company controlled by founder and former CEO Robert Saucier. Before the redemption, Saucier was Galaxy’s majority shareholder. Saucier, who founded Galaxy in 2000, left the company in November 2018 without explanation.
Galaxy Gaming’s second-quarter revenue rose 73% to $4.7 million from $664,000.
Galaxy said it cut its gross debt 2% to $50.8 million from $51.9 million.
In the statement, Galaxy Gaming Chief Executive Officer Todd Cravens said his company achieved the improved second-quarter numbers, even with United Kingdom casinos closed until mid-May. He added that Galaxy expects online-revenue growth to accelerate in this year’s second half.
On Aug. 4, Galaxy bought the rights to High Variance Games LLC’s game portfolio, which includes Super Blackjack, Super Texas Hold ’em, Super Pai Gow, Three-Card Stud Triple Draw, and Super Omaha Poker. Financial terms weren’t disclosed.
“Galaxy Gaming has the distribution network I was looking for in a partner and an impressive, forward-thinking, management team,” High Variance Games CEO Jeff Hwang said when the deal was announced. “I see an organization with a ton of upside.”
In May, Galaxy announced two deals: secured rights to provide a Perfect Pairs live gaming progressive jackpot on land-based table games in the United Kingdom and a deal to deploy Galaxy’s table-game content on Reno-based Spin Games LLC’s remote gaming server platform in North America. No financial terms were disclosed for either deal.
In a 10-Q statement filed Friday with the Securities and Exchange Commission, Galaxy Gaming said it continues to apply for new or enhanced licenses in several jurisdictions, although it didn’t name any. Galaxy added that these applications may result in “significant future legal and regulatory expenses” that might force the company to postpone investing in personnel, inventory, and product research and development.
Galaxy Gaming shares fell 23 cents, or 5.1 percent, Tuesday to close at $4.36 on the Over-the-Counter Bulletin Board. The share price has more than doubled in 2021.
Follow Matthew Crowley on Twitter @copyjockey.
