You implied in your earlier post that EGT paind a guarentee and never recovered that money and that is not true.
To my knowledge the only customer that has forced a Guarentee is NAGA. Even so, we recovered the money in a matter of months and NAGA remains THE most profitable customer in EGT's stable. I cannot think of another customer offhand that has required a guarentee other than NAGA. Can you? Bokor...I don't think so, but I could be mistaken?
Several correction to CNO's comments. The revenue sharing model is a common business practice in the industry. Large EGM manufacturers DO lease machines on a participation basis. CNO is knowledgable but his comparisons are largely negative and 'colorful'.
The payment made 'up front' to the customer is part of the bidding process and all bidders make some type of offer that is a combination of guarentee money and WUD split. The winner of the contract pays the up fron fee but in turn collects 100% of the WUD until that up front fee is recovered by the contract winner. After that point the WUD is split with teh casino owner based upon the terms of the contract (example 70%/30% where the casino owner gets 70% ).
You can see pictures of EGTs Boutique casinos at nthe company website. The casinos are more like the size of a VIP room in a large casino (but without the VIP clientelle). Some of our locations are annexes to existing large Casinos and are MUCH larger, with hundreds of EGMs.
Unfortunately EGT doe not breakout earnings metrics like larger casinos do. EGT consolidates table earnings with EGM earnings across an entire market as opposed to separate EGM/Table earnings by Venue.
Most of the significant profits made on this stock in teh past were generated when hypesters and bashers used inflated claims to move the PPS because no real data was available. That is not the case as we have several boutique casinos and a history of earnings.
The BEST place for factual information is in the historical 10Ks and 10Qs where you will see actual examples of the contract details I have described above.
Looks like my previous reply did not save.
-- EGT has 565 EGMs in the PI according to the last 10Q. You reported that none were damaged, but I have to say that the players were. 5000+ dead. Everyone in that country is still reeling from this storm - physically or financially or emotionally.. Electricity is still out in some areas and hospitals are understaffed and undersupplied to take on an event of this size. Police and First responders are being overwhelmed. Some roads were severly damaged. The international airport just repoened.
So....Locals have not come back into balance for their new post-storm "normal". Local gamers will be lower than last Q.
Airport was shut down for a week. From a travel perspective, the PI is no longer "destination location" for visitors and vacationers and it will remain that way for a while....the only visitors that can be counted on are members of one of the ongoing international relief organizations ....and I do not think that they flew here to gamble. Tourist trade will be down.
The PI operations accounted for 20% of EGT total revenue last Q. I expect that % to be much lower in Q4.
With the weather problems in the PI (affecting 565 out of 1698 total EGT EGMs), reduced revenue from Dolphin (due to the sale of non-gaming production..which I thought was a good move) and soft NAGA returns in Q3, I do not expect EGT to pull out a profitable year for 2013.
The only reason that iHub was able to get the price hyped up several years ago is because of unrealistic expectations of the revenue generated from our Dreamworld casinos. Investors can now use historical performance instead of pipe dreams to project revenue performance. Even with table games added to the WUD to inflate the number (instead of breaking out table games and slots as separate line items as most casinos do), those locations combined cannot match (and probably will NEVER match) NAGA's EGM revenue because of differences in location and exclusivity.
No new projects have been announced.
The current PPS reflects all of the above.
Just my two cents...but that just happens to be THREE cents higher than the current YTD EPS (through 3Q2013)
ALL of the FACTS related to EGTare all available in Egdar. Those 10Q/10K numbers represent the facts. Company announcements are availble on Egdar too as 8K. Analyze those documents and you will know as much or more than most of the people the people on this MB. Very few FACTS are discusssed on this MB any longer.
The only information you would lack is a multi-year historical perspective (which may not be very valuable at this point in the company's evolution), but if you are interested, those facts are available on Egdar too - you just have to dig for them and read between the lines.
If we drop below the 1.15 resistance level (low for Oct2013) we could be in for some pain. If your EGT shares are on margin, then you may want to seriously reconsider your strategy. Just a friendly suggestion.
Long term , we will see how/if EGT Management is able to build traffic in the Cambodian casinos to offset reduced revenue as the PI digs out from the devastating Super Typhoon Haiyan. As JS pointed out, even though the EGT venues themselves sustained minimal damage, the effects of the storm on infrastructure will affect both tourist trade and locals with disposable income. Roads communication, public services including fresh water and electricity, police/fire/hospitals etc. are all affected.
Been there, seen that after Katrina.
Good luck to all those folks, they are going to need it because the P.I. government does not have a well funded FEMA equivalent to pump Billion$ into infrastructure reconstruction like we have here in the US.
Congratulations. Risen, you still have a perfect prediction record for 2013....You have been wrong 100% of the time.
Statistically that is hard to do, but you make it seem SO easy.
(CNN) -- Super Typhoon Haiyan -- perhaps the strongest storm ever -- plowed across the central Philippines on Friday, leaving widespread devastation across an archipelago whose residents have endured more than their share of natural disasters......
With sustained winds of 315 kph (195 mph) and gusts as strong as 380 kph (235 mph), Haiyan may be the strongest tropical cyclone to hit land anywhere in recorded history. It will take further analysis after the storm passes to establish whether it is a record.
Any more stock preditions? or are you still bitter about being fired from MDAS and just want to complain about things you cannot prove?
Feb 28...March 1 ...3 days apart (2016 is a leap year) BTW 2/28/2016 is a Sunday :-)
My dates are correct.
If you go to EGT's website and look at the May 26, 2010 news release with heading, "Elixir Gaming Technologies Announces Expansion of Gaming Machines on Participation with NagaWorld", you will find the following:
"...All the terms regarding operations and revenue sharing under the December 2009 Machine Operation Participation Consolidation Agreement with NagaWorld will apply to the Additional Machines. For example, Elixir Gaming and NagaWorld will have joint control over the operation of all the Additional Machines, including floor staff and respective audit rights. Elixir Gaming and NagaWorld will share the revenue and certain operating costs, such as marketing and floor staff, at a 25% / 75% split, respectively, and Elixir Gaming will receive on a daily basis its portion of the daily win in cash. The contract duration is six years and expires on February 28, 2016.
In consideration for the Agreement, Elixir Gaming shall pay to NagaWorld an upfront commitment fee of $1.0 million for the Additional Machines. The commitment fee will be paid in mid June 2010....."
I would post the link for you as validation, but Yahoo MBs are no longer link-friendly.
So if that commitment fee math holds (and does not increase), they are going to want ~ $22M+ for us to keep our 670 machines in place for another 6 years.
Because there are multiple vendors currently in NAGA (and big players lurking on the perimeter) and the Slot WUD production is a matter of public record for any competitor to consider, I am guessing that the ante will be 25M-30M to keep our 670 machines at NAGA in 2016.
Evacuations are underway in the Philippines Islands as extremely dangerous Category 5 Super Typhoon Haiyan heads west-northwest at 20 mph towards the islands. Haiyan, which is the Chinese word for a petrel seabird, is referred to as "Yolanda" in the Philippines, and became a Category 5 storm with 160 mph winds at 12 UTC (7 am EDT) Wednesday. Haiyan became a Cat 5 at an unusually low latitude (7.9°N), but this is not a record. The most southerly Cat 5 on record was Super Typhoon Louise of 1964 (7.3°N), followed by 2012's Super Typhoon Bopha (7.4°N.) Haiyan is the fourth Category 5 storm in the Western Pacific and fifth on Earth so far in 2013. This is the highest number of Cat 5s since 2009, which had four Cat 5s in the Western Pacific and one in the Eastern Pacific. Since 2000, Earth has averaged 4.4 of these mightiest of tropical cyclones per year. The record for Cat 5s in a year is twelve, set in 1997, when an astonishing ten Cat 5s occurred in the Western Pacific. The Atlantic has not had a Category 5 storm since Hurricane Felix of 2007, making the past six years the longest stretch without a Cat 5 since 1981 - 1987.
This storm is massive and extremely powerful. It will definitely affect our inland casinos in the PI - the only question is to what degree.
Computer models show that it will track northwest and hit the mainland north of Cambodia, but the winds and rain will extend for hundreds of miles from the eye affecting roads and flights.
I hope those folks in the PI make it through OK...this is a nasty storm.
I am pretty sure that the contract duration is six years and expires on February 28, 2016. If that is correct, you may want to adjust your end of the world theory accordingly.
Since EGT is now debt free and has not announced any new property developments, they can afford to save up a TON of cash top pay out the ginormous up-front commitment fee that NAGA is sure to ask for. Given the mediocre performance of the Dreamland properties so far, I am sure that NAGA renewal is a serious consideration for EGT. Unfortunately this time, it will probably be a contested bid because there are other companies managing parts of the slot floor at NAGA. We are not the only fish in the sea.
That said, 2015 is secure. 2016 is a completely different question.
the #1 topic on this MB is "Who's a bigger A**hole?"...Well if there were only four posters and you asked each of them that question individually, the answer for all four would be exactly the same, "Those other three guys!"
This should be interesting. Will we see real contributions from our Dreamworld slot parlors or more 'soft opening' excuses?
Will EGT separate slot revenue and table games revenue of their Dereamland properties or keep them consolidated by country to mask the performance of non-NAGA slots?
A suprise new contract announcement or the announcement of a new Dreamworld Casino in some country other than Cambodia (ex. Vietnam, Thailand, hell...even the P.I. ) would be a welcome plus.
FACTS always trump both hype and bashing in the long run. As the old saying goes, "The numbers don't lie"
I still feel that bottom-line revenue from the stripped down, Casino chips-only Dolphin will be inconsistant and somewhat marginal. Even when chip sales were at or near zero (as they were for quite a few quarters), the auto and medical plastic sales generated SOME revenue. Now, for better or for worse, that revenue stream has been sold. It would not hurt my feelings to find out that I am wrong about the 'new' Dolphin's revenue contributions after the earnings are released. The casino chip market is highly competitive and GPIC is THE dominant player in that space. We will just have to wait a few quarters to see what trends emerge.
Good Luck to all longs
EPS may be positive (I jhave no feel how the 2 slot parlors are going to contribute), but we're not going to retire from stock with an EPS of .01-.02 per Quarter and no new venues or NAGA-like customers on the horizon . JIMO....
JS -Why do you worry about what others think? their opinion should mean nothing to you. You have been here a while, done your DD, and you have your own opinions and personal investment goals. What else is there?
We have had posters here that post hyperbole both positive and negative. We can agree or disagree and state why in a reply if we choose to....but at the end of the day most of it is just wasted bandwidth.(including this post LOL)
What will drive new Chip business?
IMO...It will take EGT's ability to sell to NON MELCO-Affiliated casinos . We have just about milked the brother-in-law cow dry. THE dominant casino chip maker in the world is GPIC. Of that there is no question. Until we can go toe-to-to with GPIC and WIN big deals in new markets that have no boardroom relationship to EGT or MELCO, the casino chip business will slow down to a trickle. We have already gone through nearly every property that the Ho family is affiliated with and even THEN, GPIC was able to capture some of the business.
From Last 10Q: "For the three-month and six-month periods ended June 30, 2013 and 2012, in the gaming products segment, the largest customer represented 59% and 43% and 37% and 38%, respectively, of total gaming products sales. "
I wonder who that single "largest customer" is? Sands? Wynn? MGM? Harrah's? Somebody else?,,,,,hmmmmm who could it be?
I have to ask the question, "without the automobile/medical plastics business to prop them up, can EGT/Dolphin be a growing profitable significant contributor to EGT's bottom line based on reorders alone?"
I think not.
What are your thoughts?
Why would you assume 2M in chip bussiness per quarter going forward based on ONE quarter's production when this company has NEVER demonstrated a history of back-to-back 2M Quarters in the chip business, that does not make sense.