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Slot Machines: International Gaming Technology’s Shows 52% Profit Increase

Slot-machine maker International Gaming Technology, slowed by the continuing recession, did have some good news for Wall Street today. The slot machine manufacturer showed a 52% profit increase in the their fiscal third quarter. The profit was attributed to tax gains.

Although International Gaming Technology's did show an impressive profit, shares fell 1.2% to $16.50 in after hours trading. So far this year, IGT stock has fallen eleven percent, as Wall Street investors have been disappointed with the stocks performance.

Chief Executive Patti Hart, said the third quarter profits "reflect meaningful progress at IGT." Goldman Sachs is not as optimistic when it comes to the slot industry and online slot machine games. Goldman Sachs analysts have gone on record saying they do not expect a full recovery until 2012.

Revenue from gaming operations, in which IGT leases the machines and shares in the profits, is down 3.5% and revenue from outright machine sales is down 7.6%. IGT relies on gaming revenue heavily from the leased machines. Their total revenue from their leasing agreements is 56% of their total sales.

IGT total reported profit was $92.1 million, 31 cents a share, which is up from $60.6 million, or 20 cents a share over last years reported profit.


Massachusetts Gambling Bill update – Gambling

The University of Massachusetts Dartmouth Center investigated one of the projects, the Massachusetts gambling bill. Using funds received from national and state programs, the University investigates economic, social and other political developments.

In the Massachusetts house, they were responsible for promoting the gambling bill that would expand gambling in the state of Massachusetts.

The University of Massachusetts has a separate group for the program, called The Center for Policy Analysis, which is also paid for by the public. By using their students to work in programs, they like to translate their research into actual laws. They call these programs as applying research into actual existing programs.

For the University of Massachusetts, Governor Deval Patrick of Massachusetts seems to work. Of all the bizarre things, he is extremely influenced by their proposals and investigations. He threatened the House and the Senate of Massachusetts that he would veto any bill that he didn't like and told them that they needed to send him a bill that would expand gambling in Massachusetts. The University of Massachusetts’, the Center for Policy Analysis has influenced him.

Coming from Governor Patrick of Massachusetts, the following is the latest warnings reported on the Internet:

"As they work through their differences, they also know they're going to have to either get something to me that can support or they're going to have to send something to me with a veto proof margin. Now, we're not at the point of threatening veto because they're not at the point of agreement."

The stalemate in the House and Senate of Massachusetts was referred by Governor Patrick.


Slot Machines – Demand for slots drops in Northeast

Northeast states’ demand for slot machines has dropped and many of the Casinos are reducing the number of slot machines on their casino floors.

Due to the slumping economy, and the demand for the offline & online slot machines, some casinos have reduced their inventory by 9% in the last 12 months. This is especially true for the casinos in Atlantic City. They have reduced their inventory 20% since 2005. This is when they had reached their peak of slot machines 42,000. Now in all 11 casinos in Atlantic City, they are down to 29,000.

In the States of Delaware, Rhode Island, West Virginia, New York and Connecticut, demand for slot machines has also dropped. Pennsylvania, Maine and Florida have seen an increase of their slot machine inventory on their Casino floors.

It is a common practice that casinos replace older slot machines with newer ones. However, some of the casinos are finding that since the demand for slot machines has dropped, it has affected their win per day drop, which is usually $230 to $240 win per day. When these industry-wide averages slip below these levels it creates too many capacities. Therefore, they cannot afford to add to their inventory, but instead they replace the older slot machines with newer ones.

The Demand for slot machine drops over the last year, has really taken a toll on the Casino industry. This is another sign of our economic slump. The most that some Casinos can do in this situation is just simply continue removing the older slot machines and not replace them at all.


Avenue Capital takes over Trump Entertainment Resorts: Casinos

On Wednesday, Avenue Capital Management was given the approval by the New Jersey Casino Control Commission, to own Trump Entertainment Resorts over a bid by investor Carl Icahn, who has filed an appeal against the decision. The bankruptcy reorganization of the company, which was formerly owned by Trump, was also approved by the New Jersey commission.

Buying distressed companies, turning them around and absorbing the profit is what Avenue Capital Management is well known. At least five years ago, they had planned to own the Entertainment Resorts and in equity, they are expecting a huge increase.

A majority ownership of 21.7 percent by Avenue Capital Management is included in the structure of the new ownership with Trump retaining 10 percent. 80 percent debt of the company’s bankruptcy proceedings are expected to be cut, from 1.8 Billion to 334 Million. Trump will remain “as involved as he wants to be”, stated a hopeful, CEO of Avenue Capital, Marc Lasry. Trump says he will remain as involved as allowed by his schedule.

Lasry has said that prior efforts from Avenue Capital will be made to sell one portion of Trump Entertainment Resorts, Trump Marina. He says that closing it is not a suitable option. If they are unable to find a buyer, they are ready to make additional investments, renovate and keep it. Trump Entertainment Resorts also owns Trump Plaza Hotel Casino and Trump Taj Mahal Casino, besides Trump Marina.


New York still trying to put 4,500 slots at Aqueduct

Of three gambling companies that submitted bids on June 29th for the franchise rights to operate slot machines at the Aqueduct racetrack, two have been disqualified. The remaining company with an active bid, Genting New York, is a subsidiary of Genting Group of Kuala Lumpur, Malaysia.

The New York Lottery disqualified two bidders, Penn National Gaming and a combined proposal by SL Green Realty Corporation, Hard Rock Cafe International and Clairvest Group, because their proposals failed to comply with the terms of the bidding process. The Lottery said that both parties submitted “altered versions” that sought to rewrite the conditions set by the state in an effort to negotiate more favorable terms for their companies.

Penn National Gaming, for example, wanted to be able to terminate its lottery license after four consecutive unprofitable quarters. SL Green sought to sidestep the upfront licensing fee of $300 million by placing it in an escrow account until the state met certain of its conditions.

The New York Lottery will make a recommendation to Governor David A. Paterson and the New York State Legislature on August 3rd.

In 2001, the New York State Legislature approved the installation of 4,500 electronic slot machines, one of the most popular casino table games, at the Aqueduct Racetrack in Queens. Since 2001, New York has tried four times to choose a gambling operator for the Aqueduct “racino” project. A racino is a location featuring both a casino and a race track.


Gambling: Ohio set to install 17,500 Video Slots at race tracks

Ohio residents who frequent one of seven horse tracks supervised by the state's Lottery Commission will soon have a new way to spend their money: feeding the one-armed bandit. Plans to install more than 17,000 video slot machines at the tracks can move forward now that the last of the legal challenges has been dropped.

Ballot issue PAC previously succeeded in collecting enough signatures to force a referendum on the November ballot, challenging the government's plan to install the slot machines, but on Monday the group reversed course and requested that Secretary of State Jennifer Brunner remove the referendum. A threat by Governor Ted Strickland to seek court relief and last year's passage of a constitutional amendment legalizing gambling in the state were cited as reasons for the group's actions.

The fight may not be over though, as a question still remains whether the Ohio Lottery Commission has the constitutional authority to operate video slot machines. According to a letter written to Brunner by LetOhioVote member Tom Brinkman, the group recognizes their best hope to stop the slots resides in the court system.

"We successfully defended Ohioans' referendum rights with our victory in the Ohio Supreme Court last year, and then the voters approved a casino gambling amendment," he wrote. "With our primary goals accomplished, it seems imprudent to proceed with a campaign that can be easily rendered moot by a court decision or new legislation authorizing" slots."