LAS VEGAS, Oct. 28 /PRNewswire/ -- PDS Financial Corporation
(Nasdaq: PDSF) today announced results for the third quarter and nine-month
period ended September 30, 1998.
For the third quarter of 1998, the Company reported revenues of
$6.8 million and net income of $42,000 or $.01 per diluted share, compared
with revenues of $17.6 million and net income of $280,000 or $.08 per diluted
share in the third quarter of 1997. Revenues from equipment sales and sales-
type leases totaled $4.6 million in the third quarter of 1998; compared with
$13.0 million in the third quarter of 1997 (all of which were generated from
one new casino operation). Gross financing originations for the 1998 period
were $11.5 million compared with $18.7 million in the third quarter of 1997.
Most of the 1998 originations were structured to contribute to monthly
earnings, rather than fee income (loss), which was ($128,900) for the 1998
quarter, compared with $819,900 in the 1997 quarter. EBITDA (Earnings Before
Interest, Taxes, Depreciation and Amortization) was $2.4 million for the third
quarter of 1998, compared with $4.2 million in the corresponding quarter of
1997.
For the nine-month period ended September 30, 1998, revenues were
$30.5 million and net income was $782,000 or $.21 per diluted share, compared
with revenues of $25.7 million and net income of $593,000 or $.18 per diluted
share in the same period of 1997. Revenues from equipment sales and sales-
type leases totaled $22.2 million in the first nine months of 1998; compared
with $13.0 million in the first nine months of 1997. Gross financing
originations for the 1998 period were $43.7 million, compared with
$72.6 million in the first nine months of 1997. EBITDA was $8.5 million for
the nine-month period ended September 30, 1998, compared with $11.1 million in
the corresponding period of 1997.
Commenting on operations, Johan P. Finley, President and Chief Executive
Officer stated, "The Company made solid progress in its strategy to increase
the portfolio of assets under lease and reconditioned gaming machine sales.
Recently we announced new business commitments totaling approximately
$61.4 million. These commitments are anticipated to begin closing in the
fourth quarter of this year, and will continue throughout 1999. This business
is a significant step forward in achieving our goal of increasing recurring
revenues and ultimately affording us greater earnings visibility. PDS Slot
Source, which was formed one year ago, shipped approximately 2,200 used gaming
devices in the third quarter and generated $4.6 million in revenue. Also
during the quarter we announced the receipt of our Indiana gaming supplier's
license, opening yet another market for both SlotLease and Slot Source. We
now look to capitalize on the opportunities created by these accomplishments."
The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain of the statements contained
herein which are not historical facts are forward-looking statements with
respect to events, the occurrence of which involve risks and uncertainties.
These forward-looking statements may be impacted, either positively or
negatively, by various factors. Information concerning potential factors that
could affect the Company is detailed from time to time in the Company's
reports filed with the Securities and Exchange Commission.
PDS Financial Corporation, with offices in Las Vegas and Minneapolis,
provides leasing and financing to the gaming industry, and supplies
reconditioned gaming devices to casino operators throughout the United States.
Since 1991, PDS has completed over $450 million in gaming finance transactions
and in 1996 introduced SlotLease, a specialized leasing program for slot
machines and other electronic gaming devices. In mid-1997, the Company
established its reconditioned gaming device sales and distribution line of
business, PDS Slot Source, to complement its leasing and financing activities
and to generate equipment sales to casino operators.
PDS FINANCIAL CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement of Income
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
1998 1997 1998 1997
Revenues
Equipment sales $2,517,298 $18,867,933
Income from
sales-type
leases 2,068,034 $13,048,913 3,334,672 $13,048,913
Rental revenue
on operating
leases 1,349,337 3,277,882 4,974,020 9,090,165
Fee income (loss) (128,914) 819,919 1,238,939 2,328,457
Finance income 948,660 424,834 2,065,724 1,262,024
Other income, net 337 (5,076) 1,061 3,152
Total revenues 6,754,752 17,566,472 30,482,349 25,732,711
Costs and Expenses
Equipment sales 1,323,190 -- 15,538,415 --
Sales-type leases 1,845,347 12,457,651 2,872,590 12,457,651
Depreciation on
operating leases 880,814 2,506,687 3,729,402 6,797,827
Selling, general and
administrative 1,201,884 900,595 3,551,195 2,206,183
Interest 1,434,486 1,246,520 3,528,593 3,312,440
Total costs
and expenses 6,685,721 17,111,453 29,220,195 24,774,101
Income before
income taxes 69,031 455,019 1,262,154 958,610
Provision for
income taxes 27,000 175,000 480,000 366,000
Net income $ 42,031 $ 280,019 $ 782,154 $ 592,610
Earnings per share:
Basic $ .01 $ .09 $ .22 $ .19
Diluted $ .01 $ .08 $ .21 $ .18
Number of shares used to compute per share amounts:
Basic 3,644,008 3,134,441 3,599,177 3,124,691
Diluted 3,797,806 3,299,189 3,815,037 3,211,414
SOURCE PDS Financial Corporation
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Company News On-Call:
http://www.prnewswire.com/comp/678650.html or fax,
800-758-5804, ext. 678650
CONTACT:
Peter D. Cleary, Chief Financial Officer of
PDS Financial Corporation, 702-736-0700; or James K. White of
Kehoe, White, Savage & Co., Inc., 562-437-0655
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