MATTHEWS, NC -- (Marketwire) -- 08/08/12 -- PokerTek, Inc. (NASDAQ: PTEK)
Financial Highlights (compared to prior year):
•Operating loss improved 55% •Gross Margin increased to 75% from 71% •Operating Expenses decreased 25%
•262 net gaming positions installed, increases installed base to 2,294 •Operating loss improved 9% •Gross Margin of 71% in both periods •Operating expenses decreased 25%
PokerTek, Inc. (NASDAQ: PTEK) today reported financial results for the period ended June 30, 2012.
"We installed 262 gaming positions at 13 new customer locations, making the second quarter one of the most productive in PokerTek's history," said Mark Roberson, Chief Executive Officer and Chief Financial Officer. "We also continued to realize improved operating results, driven primarily by cost controls and operational efficiency.
"Recently-installed gaming positions will begin contributing to recurring revenue in the third quarter. We have a busy installation schedule planned for the second half, and we expect growth in recurring revenue to drive our financial results in the third and fourth quarters. Our goal is to achieve sustainable EPS profitability by year-end."
Total revenue was $2.7 million for the first half of 2012 compared to $3.5 million in 2011, a reduction of 21.5%. For the second quarter, total revenue was $1.0 million in 2012 compared to $1.5 million in 2011, a reduction of 30.6%.
Revenue from license and service fees decreased $589 thousand for the first half and $316 thousand for the second quarter. License and service fee comparisons for both the three and six month periods were favorably affected by increased revenue from the Canadian and cruise markets. Those increases were offset by decreases from Mexico, where we removed leased product in September 2011 due to regulatory changes; less favorable macroeconomic conditions in Eastern Europe; and the conversion of gaming positions from lease to sale in the United States. License and service fees also follow seasonal trends which mirror the business of our customers, with the second quarter representing the seasonal trough in both 2012 and 2011. Revenues from sales of systems and equipment decreased $157 thousand for the first half and $143 thousand for the second quarter. In the prior year periods, sales of systems and equipment were favorably impacted by system sales in Europe which did not repeat in the current year and higher recognition of deferred revenue.
While growth in gaming positions was robust, the majority of those installations occurred near the end of the period. Accordingly, recurring revenue from those installations are expected to begin contributing more meaningfully in the second half of 2012.
Gross profit was $2.0 million for the first half of 2012 compared to $2.5 million in 2011, a reduction of $0.4 million, or 17.5%. Gross profit was $0.7 million for the second quarter of 2012 compared to $1.1 million in 2011, a reduction of $0.3 million, or 30.8%.
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