Agreement on gaming machines lifts Elixir

via CAAI News Media

Monday, 19 April 2010 15:00 Ellie Dyer

ELIXIR Gaming Technologies Inc saw its stock price rise to an April high on Friday after agreeing to provide 60 gaming machines to a Cambodian casino last week, further strengthening its presence in the Kingdom.

The Las Vegas-based company entered into a contract to install 60 gaming units in the new Grand Golden casino, near the Vietnam border in Kampong Cham province, according to a press statement issued early last week.

It also secured an order, valued at US$340,000, to supply gaming plaques and chips for Melco Crown Entertainment’s City of Dreams casino resort in Macau. The announcements saw share prices climb steadily on the New York Stock Exchange to $0.26 a share at close Friday, a high for April.

The deal with Grand Golden Co Ltd is the latest move by Elixir to consolidate its position in Cambodia, which Chairman and CEO Clarence Chung described in the announcement as “a key market”.

"Given the contracted 60 machines are expected to be sourced primarily from our current inventory, capital expenditures for this project should be minimal,” said Chung, who did not detail the exact cost of the deal.

The importance of the Kingdom for Elixir was illustrated in its fourth quarter results, released in March.

Statements detailing its Q4 finances said total revenues improved 26 percent on quarter three to $4.5 million. A large proportion of revenue was garnered from 560 slot machines at NagaWorld in Phnom Penh, where revenues soared to $1.5 million from $1.1 million.

The deal with Grand Golden Co Ltd, whose owners Chung described as “established gaming operators in the Indo-China region”, is set to come into place in November, following renovations to the casino floor. Elixir will receive a proportion of winning profits while the five-year contract is in place. It will take on 30 percent of revenue and marketing costs, with Grand Golden taking 70 percent.