Just two weeks after announcing the exit of its founder and controlling shareholder, Galaxy Gaming reported record revenue and reversed its loss for the third quarter.
On Nov. 5, Galaxy, a Las Vegas-based developer, manufacturer and distributor of casino table games and systems, said Robert Saucier would leave the company and its board Dec. 31. He had served as executive vice president of business development.
Galaxy didn’t explain Saucier’s departure, but said it retained Macquarie Capital Inc. to help evaluate the potential sale of the 23.3 million shares of common stock the Saucier-controlled Triangulum Partners LLC holds. The stake, which amounts to 60 percent of the company. would be worth $33.55 million based on Thursday’s closing price.
Meanwhile, in a 10-K report filed Wednesday with the Securities and Exchange Commission, Galaxy said its net income was $791,968, or 2 cents per share, for the three months ended Sept. 30, reversing a net loss of $27,930, or break-even per share, a year earlier.
Revenue rose 45 percent to $4.8 million from $3.3 million.
Adjusted earnings before income, taxes, depreciation and amortization, a cash flow measure that excludes one-time expenses, rose 38.5 percent to $1.8 million from $1.3 million.
“We continue to see lower expense growth as compared to last year,” Galaxy CEO Todd Cravens said in a statement accompanying the earnings news. “Our recently-installed progressives in the U.K. and the U.S. markets are performing exceptionally well.”
Cravens added that the company’s new games, which are mostly side bets on traditional table games, such as blackjack, were warmly received at October’s Global Gaming Expo in Las Vegas. Galaxy’s games include Three Card Poker, Lucky Ladies and Texas Shootout.
Also in the statement, Galaxy Chief Financial Officer Harry Hagerty said Galaxy’s cash holdings stood out.
“In spite of paying over $1 million to refinance our debt in April, cash has increased by almost $1.7 million and, at $5.25 million as of September 30, represents 50 percent of our total gross debt,” Hagerty said.
Saucier, who founded Galaxy in 2000, had long raised gaming regulators’ doubts in Nevada and elsewhere.
In September 2017, Saucier, now 63, resigned as Galaxy’s chairman and CEO after the Nevada Gaming Control Board had nearly denied his application for a license to distribute new games in Nevada. The board had queried Saucier for two days about his business practice and questioned his suitability for a license, deeming his application a “train wreck.” The board sent the application back to Galaxy’s staff to reassess and refashion.
Saucier, who founded Galaxy in 2000, had trouble with gaming regulators in California, Oregon and Washington.
When Saucier ceded his titles in 2017, Galaxy named former Gaming Control Board Chairman Mark Lipparelli as company chairman and Cravens as CEO and president. Cravens had joined Galaxy in January 2017 as vice president of business development.
Galaxy Gaming shares fell 1 cent, or 0.69 percent, Thursday, to close at $1.44. The share price has risen 20 percent in 2018.
Follow Matthew Crowley on Twitter @copyjockey
