Table Trac, Inc. Announces Second Quarter 2010 Financial Results

MINNETONKA, Minn., Aug. 16 /PRNewswire-FirstCall/ -- Table Trac, Inc. (OTC Bulletin Board: TBTC), a developer and provider of casino information and management systems that automate and monitor the operations of casinos, today announced financial results for its second quarter and  six months, the periods ended June 30, 2010.

Second Quarter Highlights

• Overall revenue in the second quarter of 2010 increased 24.1% sequentially to approximately $457,000 from $368,000 in the first quarter of 2010.
• Two installations, related to the Keetoowah Cherokee Casino in Tahlequah, Oklahoma and the Fort Belknap Casino in Harlem, Montana, were delayed but have been completed in the third (current) quarter. This resulted in more than $500,000 in system sale revenue being recognized already in the third quarter.
• Recurring revenue for the second quarter of 2010 from ongoing, contracted maintenance increased 5.5% to approximately $248,000 from $235,000 in the first quarter of 2010. Revenues from recurring contracted maintenance increased from $246,000 in the second quarter last year.
• The Company has four Casino Trac Systems in its backlog; two were in process at June 30, 2010.
• The Company is currently working with gaming establishments in eight U.S. states, as well as countries in Central and South America to purchase new systems and expand service offerings for existing customers.  

Second Quarter Financial Results

Net revenue for the three months ended June 30, 2010 increased 24.1% sequentially to approximately $457,000 from $368,000 in the first quarter of 2010 but decreased 56.3% from $1.0 million in last year's comparable period because no large system installations were completed in 2010 compared to one large installation in 2009. Two installations that were scheduled for a second-quarter deployment were delayed but have been completed already in the third quarter. Recurring revenue from ongoing, contracted maintenance increased 5.5% to approximately $248,000 from $235,000 in the first quarter of 2010 but decreased 19.2% from $307,000 in the second quarter last year. Revenues from license and maintenance fees decreased for 2010 mainly due to a one-time license fee of $61,000 on the Company's one system sale in 2009 that did not recur in 2010.

"The delay of two deployments impacted our second quarter but will substantially benefit the third quarter, and one of these delays was due to an expansion of the original agreement which added more than $100,000 to our system sale revenue," said Chad Hoehne, Table Trac President and CEO. "With these two deployments already completed, we will experience a particularly strong third quarter. In addition, we are in final discussions with another potential client, and expect to announce this additional sale in the coming weeks. Together, these three projects should increase our base of recurring revenue, benefiting the company in the coming quarters."

Gross profit for the quarter was $399,000, or 87.3% gross margin, compared sequentially to $331,000, or 90.6% gross margin, and compared to $667,000, or 63.8% gross margin, during the comparable period in 2009. The overall increase in gross margin was primarily due to a decrease in system installations completed during the current period compared to the large system installation completed in last year's comparable period. Generally, system sales have a lower gross profit compared to license and maintenance fee revenue.

Total operating expenses decreased 5.4% to $612,000 for the quarter ended June 30, 2010 compared to $647,000 for the year-ago period. Sales and marketing, research and development, professional fees, stock compensation and insurance all increased over the prior year period offset by a decrease in bad debt expense.

Table Trac reported a loss from operations of approximately $(213,000) for the second quarter ended June 30, 2010 compared to operating income of approximately $20,000 in the second quarter last year. Net loss was approximately $(126,000) or $(0.03) loss per basic and diluted share (based on approximately 4.2 million basic and diluted weighted average shares outstanding) compared to net income of approximately $60,000, or $0.01 per basic and diluted share (based on approximately 4.2 million basic and 4.5 million diluted weighted average shares outstanding, respectively) in the year ago period.

"We have significantly increased our sales and marketing efforts, and our pipeline of opportunities is growing each month," Mr. Hoehne added. "In the coming weeks, we expect to launch two new products at important industry trade shows, further bolstering our reputation in the industry and extending our competitive advantage. Increasingly, we are being recognized for our technology and our rapid return on investment, and this message is resonating outside the tribal market with other casinos around the world."

Year-to-Date Financial Results

Net revenue for the six months ended June 30, 2010 decreased 62.3% to $825,000 from $2.2 million for last year's comparable period. Recurring revenues from ongoing, contracted maintenance decreased to $484,000 from $521,000 in last year's comparable period. Revenues and recurring revenues decreased for the same reasons mentioned above offset by other sales, which include printers, kiosk software, mailing services, and consulting services which increased over the comparable period in 2009 when they began being offered.

Gross profit for the six months ended June 30, 2010 was $736,000, or 89.2% gross margin, compared to gross profit of $1.7 million, or 76.5% gross margin, in the comparable period last year.

Total operating expenses for the six months ended June 30, 2010 were $1.1 million, flat with $1.1 million for the year-ago period.

Table Trac's loss from operations was $(353,000) compared to operating income of $597,000 in the same period last year. Net loss was approximately $(199,000) or $(0.05) loss per basic and diluted share (based on approximately 4.2 million basic and diluted weighted average shares outstanding) compared to net income of approximately $421,000, or $0.10 per basic and $0.09 per diluted share (based on approximately 4.2 million basic and 4.5 million diluted weighted average shares outstanding, respectively) in the year ago period.

The Company generated approximately $153,000 in operating cash flow in the period ended June 30, 2010, and had $1.4 million in cash and cash equivalents, or $0.34 per share, as of June 30, 2010 compared to $1.3 million, or $0.29 per share, at December 31, 2009. The Company has no debt.

About Table Trac, Inc.

Founded in 1995, Table Trac, Inc. develops and sells casino information and management systems. The company provides system sales, installation, training, as well as license and technical support to casinos. The company has systems installed in North, South, and Central America.

More information is available at http://www.tabletrac.com/.

Forward Looking Statements

Statements made in this press release, including statements regarding events and financial trends that may affect our future operating results, financial position and cash flows, may constitute "forward-looking statements" within the meaning of the federal securities laws. These certain statements are based on our assumptions and estimates and are subject to risks and uncertainties. You can identify these forward-looking statements by words like "strategy," "expects," "plans," "believes," "will," "estimates," "intends," "projects," "goals," "targets" and other words of similar meaning. You can also identify them by the fact that they do not relate strictly to historical or current facts. For these statements, we claim the protection of the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995.

For further information on factors that could impact Table Trac and statements contained in this press release, reference should be made to Table Trac's filings with the Securities and Exchange Commission, including quarterly reports on Forms 10-Q, current reports on Form 8-K and annual reports on Form 10-K. You can access such filings at http://www.sec.gov.

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SOURCE Table Trac, Inc.