LAS VEGAS, March 30 /PRNewswire-FirstCall/ -- VendingData(TM) Corporation (AMEX:VNX) today reported financial results for its fiscal year and fourth quarter ended December 31, 2006. Gross revenues for the full year 2006 increased 166 percent to $8.3 million as compared to $3.1 million for the year ended December 31, 2005. Gross revenues were offset by sales returns and allowances of $383,000, an improvement from the $739,000 recorded for full year 2005. Overall gaming product sales increased 70 percent in 2006 due to the introduction and sale of the Dolphin high frequency RFID casino chips and sales of the DeckChecker product at new casino openings in Macau. Revenues by gaming product line in 2006 consisted of casino chip sales of $1.8 million, Deck Checker sales of $1.4 million, Deck Checker rentals of $108,000, shuffler sales of $462,000, shuffler rentals of $230,000, and ancillary gaming product sales of $264,000. Non gaming revenues for 2006 were $3.8 million.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020325/LAM034LOGO) VendingData's negative gross margin on revenue for the year ended December 31, 2006 was $1 million, compared to the negative gross margin on revenue for the year ended December 31, 2005 of $2.3 million excluding the impact of the 2005 inventory write down of $3.1 million. The gaming business achieved an increase in gross margin of $676,000 and an increase in gross margin as a percentage of revenue from 41% in 2005 to 46% in 2006. Gaming product gross margin breakdown for the year was Dolphin casino chips at 29 percent, DeckChecker at 70 percent, and the shuffler line at 40 percent.
Selling, general and administrative expenses (SG&A) increased 1 percent over the prior year to $9.3 million in 2006. The components affecting SG&A during the year were a decrease of approximately $2.0 million in legal and regulatory costs offset by increases in expenses of $607,000 attributable to the inclusion of Dolphin an $800,000 increase in fees relating to the Elixir transaction and the Dolphin acquisition, a $100,000 increase due to preparation for Sarbanes Oxley compliance and an increase of $145,000 in rent for the new China facility.
For the year ended December 31, 2006, research and development expenses were $1,556,000, or 12% more than the year ended December 31, 2005. These are costs associated with the development of the newly launched ChipWasher and ShufflePro.
Interest expenses in 2006 increased by 19 percent to $1.9 million, reflecting the debt service related to the Company's 8% financing arrangement, Dolphin's short term overdraft facilities, and, for the first five months of 2006, the 9% senior secured notes, the 10% senior secured convertible notes and the $5 million line of credit.
The Company reported a net loss for 2006 of $13.7 million or $0.57 per share compared to a net loss of $17.6 million or $1.03 per share in 2005 Cash and equivalents on December 31, 2006 were at $334,000. Trade accounts receivable increased from $1.6 million at year end 2005 to $1.9 million year end 2006. Inventories increased by approximately $400,000 to $3.4 million at year-end 2006. Total assets increased over prior year to $31.5 million primarily due to the acquisition of Dolphin during 2006. Total liabilities increased by $9 million during the year to $28.5 million due to an increase in accrued expenses and debt that was comprised of several convertible notes that converted to the Company's shares during the first week of January 2007. Subsequent to December 31, 2006, the company received cash from private placements of 2.65 million shares at a price of $2.65 per share. As of March 31, 2007, VendingData had approximately 35 million shares of common stock outstanding, with fully diluted share count totaling 58 million. The aggregate proceeds if all options and warrants were to be exercised would approximate $75 million.
Revenues for the fourth quarter were $3.1 million, an increase of $2.7 million from prior year's fourth quarter of $416,000 and compares to third quarter 2006 revenues of $2.4 million. The Company's revenue increased quarter over quarter as a result of activity in RFID casino chip sales as well as increased DeckChecker sales.
Gross margins for the fourth quarter for gaming products was $306,000 or 33% compared to ($318,000) for the fourth quarter of 2005. Compared to the third quarter of 2006 gaming product margins were up $65,000. The gross margin percent reduction compared to the Q3 2006 gross margin percentage of 53% is due to product mix as RFID chips accounted for 49% of Q4 2006 gaming revenue compared to 11% for Q3 2006.
The company's SG&A for the fourth quarter 2006 was $1.2 million less than the same period for the prior year due to reduced legal expenses as well as a reduction in salaries caused by less overtime and reduced headcount. Compared to the third quarter of 2006 SG&A increased by $750,000 due entirely to fees relating to the Elixir transaction and non cash option expense.
The Company reported a net loss applicable to common stockholders of $4.4 million or $(0.15) per share for the fourth quarter of 2006 compared to a net loss of $5.6 million or $(0.34) for the fourth quarter 2005 and a loss of $4.1 million or $(0.15) per share for the third quarter 2006, with the quarter to quarter increased loss driven exclusively by one time deal expenses relating to the Elixir and Dolphin transactions.
"Eighteen months ago, when this team assumed management responsibilities for VendingData, our stated objectives were an operational turn around, increases to our IP portfolio, expansion of our product lines, a stronger balance sheet and profitable revenue growth. As of the second quarter 2006 the restructuring, transitioning and repositioning were behind us, enabling us to focus our efforts on expanding our product offering. We have substantially increased our addressable market beginning in the third quarter 2006 with the launch of our casino chip and plaque line, Chipwasher, and next generation shuffler lines, with our new ShufflePro product as the first shuffler entirely engineered and manufactured by our new engineering and manufacturing team. As testimony to the initial acceptance of this product, we have last week received approval from the Nevada gaming laboratory and are in the process of installing trial sites in several leading casino operators in Las Vegas. Our product line has not only grown materially, but is achieving high reliability standards at advantageous price points. With this strength we have been able to expand our distribution and most importantly have entered in to an increasingly expanding alliance with Elixir, a wholly owned subsidiary of Melco International Development, Ltd., the largest gaming and entertainment company in Asia," commented Mark Newburg, President and CEO of VendingData." "Today our company continues to improve its financial position, enabling us to shift our focus to deliver profitable revenue growth during 2007. As we near the end of the first quarter 2007, it has become clear that the growth rates we have demonstrated over the past three quarters will continue in 2007." CONFERENCE CALL
Conference Call Details: Date/Time: Friday, March 30, 2007-2:00 p.m. (ET)
Telephone Number: 866-270-6057
International Dial-In Number: 617-213-8891
Participant Pass code: 98036655
Internet Access: http://www.vendingdata.com/ or http://www.earnings.com/
It is recommended that participants phone-in at least 10 minutes before the call is scheduled to begin. A replay of the conference call in its entirety will be available approximately one hour after its completion by dialing 888-286-8010 (U.S.), 617-801-6888 (International) and entering the pass code 12310940, and on the Internet at http://www.earnings.com/.
About VendingData(TM) Corporation VendingData Corporation is a Las Vegas-based developer, manufacturer and distributor of innovative products for the gaming industry. The company's products include the DeckChecker(TM), RandomPlus(TM) and PokerOne(TM) shuffler lines, and the Dolphin Chip product line, which include traditional and high- frequency (13.56 MHz) RFID gaming chips. VendingData's newest innovative products include ShufflePro(TM), the ChipWasher(TM) and high-value gaming plaques. Visit the VendingData Web site at http://www.vendingdata.com/.
This release contains forward-looking statements. Such statements reflect and are subject to risks and uncertainties that could cause actual results to differ materially from expectations. Factors that could cause actual results to differ materially from expectations include, but are not limited to, the following the success of the transition of our manufacturing and assembly to China, changes in the level of consumer or commercial acceptance of the Company's existing products and new products as introduced; competitive advances; acceleration and/or deceleration of various product development and roll out schedules; higher than expected manufacturing, service, selling, administrative, product development and/or roll out costs; current and/or unanticipated future litigation; regulatory and jurisdictional issues involving VendingData(TM) Corporation or its products specifically, and for the gaming industry in general; general and casino industry economic conditions; the financial health of the Company's casino and distributor customers both nationally and internationally; and the risks and factors described from time to time in the Company's reports filed with the Securities and Exchange Commission, including, but not limited to the company's Form 10- QSB for the quarter ended December 31, 2006, and, once filed, the Company's Annual Report on form 10-KSB for the year ended December 31, 2006.
Contacts: Company Contact: or Investor Contact:
Arnaldo Galassi Yvonne L. Zappulla
CFO & VP Finance Managing Director
VendingData(TM) Corporation Grannus Financial Advisors
702-733-7195 212-681-4108
VENDINGDATA CORPORATION AND SUBSIDIARY
Consolidated Statements of Operations
Years Ended December 31, 2006 and 2005 2006 2005 Sales $3,637,753 $2,302,484
Rental 338,058 519,635
Non-gaming revenue 3,780,430
Service 230,178
Other 264,359 278,619
Gross revenue 8,250,778 3,100,738
Less sales returns and allowances (383,122) (739,263)
Net sales 7,867,656 2,361,475 Operating costs and expenses:
Cost of sales 8,901,524 7,736,066
Selling, general and administrative 9,323,468 9,220,636
Research and development 1,555,882 1,394,006
19,780,874 18,350,708
Loss from operations (11,913,218) (15,989,233) Interest expense, including $15,063
and $31,974 to related parties 1,821,501 1,577,996 Net loss $(13,734,719) $(17,567,230) Basic loss per share $(0.57) $(1.03) Weighted average shares outstanding 24,270,827 17,050,398 VENDINGDATA CORPORATION AND SUBSIDIARY
Consolidated Balance Sheets
December 31, 2006 and 2005
ASSETS 2006 2005
Current assets:
Cash and cash equivalents $333,888 $935,243
Current portion of accounts receivable,
trade net of allowance for uncollectibles
of $267,154 and 276,420 1,856,898 1,550,559
Other receivables 2,650,000 0
Due from affiliates and employees 138,181 4,098
Prepaid expenses and other receivables 46,494 113,557
Inventories 3,407,361 3,045,334
8,432,822 5,648,791
Accounts receivable, trade, net of current
portion, less unamortized discount 358,841 600,430
Equipment rented to customers, net of
accumulated depreciation of
$67,673 and $228,032 94,777 146,527
Property and equipment, at cost, net of
accumulated depreciation of
$2,472,897, and $2,408,234 3,493,817 585,431
Intangible assets, at cost, net of
accumulated amortization of
$654,369 and $836,281 4,801,945 1,862,268
Goodwill 13,429,199 --
Deferred costs 613,974 748,171
Deposits and other assets 305,282 759,653
$31,530,657 $10,351,271 LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIENCY)
Current liabilities:
Capital leases payable, current portion $440,719 $471,269
Accounts payable 2,354,163 1,836,234 Accrued expenses 3,122,792 794,203 Deferred revenues, current portion 43,599 52,248 Short-term debt 676,600 4,050,000
Current portion of long-term debt 1,799,494
Customer deposits 14,258 81,858
8,451,624 7,285,812 Deferred revenues, net of current portion 43,199 161,335
Notes payable, net of current portion 19,793,524 11,654,500
Capital leases payable, net of current
portion 269,272 421,975
28,577,619 19,523,622 Stockholders' equity (deficiency):
Common stock, $.001 par value, 70,000,000
shares authorized 30,015,099 and 18,141,950
share issued and outstanding 30,016 18,142
Additional paid-in capital 102,449,179 66,763,192
Treasury stock 448,053 shares at cost (846,820) (846,820)
Deferred expense (13,236,840) (3,419,088)
Deficit (85,422,497) (71,687,777)
Total stockholders' equity (deficiency) 2,973,038 (9,172,351)
Total liabilities and stockholders'
equity (deficiency) $31,530,657 $10,351,271
http://www.newscom.com/cgi-bin/prnh/20020325/LAM034LOGO http://photoarchive.ap.org/ DATASOURCE: VendingData(TM) Corporation CONTACT: Company Contact, Arnaldo Galassi, CFO & VP Finance, VendingData(TM) Corporation, +1-702-733-7195, ; or Investor Contact, Yvonne L. Zappulla, Managing Director, Grannus Financial Advisors, +1-212-681-4108, , for VendingData(TM) Corporation Web site: http://www.vendingdata.com/
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