Table Trac, Inc. Announces Profits, 115.4% Year-over-Year Revenue Growth for Fourth Quarter 2010

MINNETONKA, Minn., April 1, 2011 /PRNewswire/ -- Table Trac, Inc. (OTCBB: TBTC), a developer and provider of casino information and management systems that automate and monitor the operations of casinos, today announced profitable financial results on strong revenue growth for its fourth quarter, the period ended December 31, 2010.

Fourth Quarter Highlights

• Overall revenue in the fourth quarter of 2010 increased to approximately $1.2 million, up 29.3% sequentially compared to $959,000 in the third quarter of 2010 and up 115.4% year-over-year from $576,000 in the fourth quarter of 2009.
• Two installations, related to the Celebrity Casino in Deadwood South Dakota and the Flowing Waters Navajo Casino in New Mexico, were completed during the fourth quarter, resulting in approximately $450,000 in system sales revenue being recognized during the quarter.
• One Casino system as a rental system was installed in the fourth quarter, under a four-year rental agreement that will benefit recurring revenues for that rental period.
• Recurring revenue for the fourth quarter of 2010 from ongoing, contracted maintenance was approximately $253,000, an increase of 47.3% from $172,000 in the year-ago period.
• Announced a multi-property system agreement with the Seminole Nation Division of Commerce. This is the sixth new gaming operator to select Table Trac during 2010. Table Trac will provide three casino management systems to be used at the Seminole Nation Casino in Seminole, Oklahoma, River Mist Casino in Konawa, Oklahoma and the Trading Post Casino in Wewoka, Oklahoma.
• Table Trac elected Michael I. Connolly and Steve Browne to its Board of Directors. Mr. Connolly was elected Chairman of the Board.  

Subsequent to 2010 Year End

• Curacao's Diamond Beach Casino selected Table Trac to provide a comprehensive, total solution casino management system that includes a complete suite of casino management products (CasinoTrac™ and TableTrac™), including slot accounting, patron management and player tracking, a table games management system, along with PromoTrac™ and KioskTrac™ Table Trac's marketing and promotional solution that assists casinos in driving player revenues.

Fourth Quarter Financial Results

Net revenue for the three months ended December 31, 2010 increased 29.3% sequentially and 115.4% year-over-year to approximately $1.2 million from $959,000 in the third quarter of 2010 and from $576,000 in the fourth quarter of 2009. The quarter benefited from approximately $450,000 in system sales revenue being recognized in the fourth quarter related to installations. The Northern Winz Casino in Montana will contribute to monthly recurring revenue during its 4 year rental. Recurring revenue for the fourth quarter of 2010 from ongoing, contracted maintenance was approximately $253,000, an increase of 47.3% from $172,000 in the same period last year.

"We again benefited significantly, both now and in the future, from installations during the quarter," said Chad Hoehne, Table Trac President and CEO. "Our strong fourth quarter was primarily due to continued attention to our expanded sales and marketing initiatives with a focus on aligning the Company's technologies, products and services to increase customer value. Also, during the quarter, we announced a sixth new gaming operator to select Table Trac during 2010, which includes three new systems and will drive revenue in 2011. In addition, we opened up a new type of market by providing our Table Trac system as a rental with option to buy for those properties that really want and need a casino management system but simply cannot afford to buy one outright. These generate revenue month to month versus a full sale."

Gross profit for the quarter was approximately $978,000, or 78.8% gross margin, compared sequentially with gross profit of $608,000, or 63.4% gross margin and compared with gross profit of $323,000, or 56.0% gross margin in the year-ago quarter. The increase sequentially from the third quarter 2010 is primarily due to an increase in system installations completed during the fourth quarter of 2010 and compared with no system installations during the same period last year.

Total operating expenses were approximately $599,000 for the quarter, an increase of 8.8% sequentially compared to the $551,000 for the third quarter of 2010 and up 67.6% compared to approximately $357,000 for the fourth quarter of 2009. The primary driver in both the year-over-year and the sequential increase in operating expenses were significant increases in sales and marketing expenses, as well as increases for contractors to handle the increasing research and development projects, increased public company expenses, increased stock-based sales incentive compensation, travel expenses, insurance, mileage reimbursement, and outside commissions.

Table Trac reported income from operations of approximately $379,000 compared sequentially to income from operations of $57,000 for the third quarter and a loss from operations of approximately $(35,000) from the same quarter in 2009. Net income after tax was approximately $280,000, or $0.07 per basic and diluted share (based on approximately 4.28 million basic and 4.28 diluted weighted average shares outstanding). This compares sequentially to net income of approximately $44,000 or $0.01 per basic and diluted share (based on approximately 4.3 million basic and 4.6 million diluted weighted average shares outstanding) for the third quarter of 2010 and compares to a net loss of approximately $(51,000), or $(0.01) per basic and diluted share (based on approximately 4.3 million basic and diluted weighted average shares outstanding, respectively) in the year-ago period.

"Our increased investment in technology, sales and marketing, and personnel during 2010 continues to gain traction and deliver the positive results we envisioned at the start of the year," Mr. Hoehne added. "In addition to bringing in Glenn Goulet as our executive vice president to help drive, expand and manage sales and marketing initiatives, we added two experienced board members, Michael Connolly and Steve Browne, and we are seeking an additional independent director to improve the makeup of our board. The board is searching for a full-time chief financial officer, and we are developing a robust sales and marketing plan, including sales incentives, to help accelerate sales during 2011 and reduce the quarter-to-quarter fluctuations in revenue levels. In the next 90 days, we anticipate forming an advisory group and conducting a detailed competitive analysis to ensure our differentiation in the marketplace."

Year-to-Date Financial Results

Net revenue for the year ended December 31, 2010 decreased 4.2% to $3.0 million from $3.2 million for last year's comparable period. Although Table Trac installed five systems in 2010 and only four in 2009, two of the systems in 2010 were rental systems which generate revenue month to month versus a full sale. Recurring revenues from ongoing, contracted maintenance increased 6.8% to $956,000 from $895,000 in last year's comparable period. Gross profit for the year ended December 31, 2010 was $2.3 million, or 76.7% gross margin, compared to gross profit of $2.4 million, or 74.8% gross margin, in the comparable period last year. Total operating expenses for the year ended December 31, 2010 were $2.2 million, a decrease of 7.3% compared with $2.4 million for the same period last year. This decrease was primarily due to a significant decrease in bad debt expense.

Table Trac's income from operations was approximately $83,000 compared to an operating loss of $(51,000) in the same period last year. Net income was approximately $124,000 or $0.03 per basic and diluted share (based on approximately 4.3 million basic and diluted weighted average shares outstanding) compared to net income of approximately $16,000, or $0.00 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.

The Company utilized approximately $335,000 in operating cash flow in the full-year period ended December 31, 2010, and had $935,000 in cash and cash equivalents, or $0.22 per share, as of December 31, 2010 compared to $1.3 million, or $0.32 per share, at December 31, 2009. The Company has no debt.

Mr. Hoehne added, "We have four new system installations in process or scheduled for the first half of 2011, and Mr. Goulet and his team have significantly increased our exposure to potential new customers.  Together with our technology initiatives in new product and existing product enhancements, we are providing our casino customers real value. This will serve to bolster our industry presence and success."  

Quotation of Table Trac Stock

Management is aware that the quotation of the company's common stock has recently been confusing. The Company has learned that market makers trading in the stock recently dropped use of FINRA's OTCBB platform in favor of trading on the OTCQB. As a result of the market makers' determination to cease quotations on the OTCBB, under FINRA rules, Table Trac's common stock was automatically removed from the OTCBB market. It is important to note that Table Trac is not out of compliance with the reporting requirements of the OTCBB and, in fact, the Company has filed all reports required to be filed with the SEC on a timely basis. Table Trac's common stock continues to trade on the OTCQB market and can now be found under the symbol TBTC.PK.

The OTCQB marketplace is part of the Pink OTC Markets' electronic interdealer quotation and trading system. Companies traded on the OTCQB marketplace are required to comply with SEC reporting requirements or the reporting requirements of a bank or insurance regulator. Up to date quotes of OTCQB stocks, and more information on the OTCQB marketplace, may be found at www.otcmarkets.com. Market makers have advised Table Trac that they have dropped use of the OTCBB because of added fees necessary to keep that designation as well as the superior performance and functionality of the Pink OTC Markets' platform.

Mr. Hoehne commented, "While we are frustrated to have become a victim of this decision by our market makers, we are one of more than 1,000 other companies to have experienced this situation. Our focus remains on building shareholder value and given recent events, we are all the more committed to moving our company to a national stock exchange in the future."

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.

Tables Follow

SOURCE Table Trac, Inc.