After reporting a slight decline for the first time since Nov 2011 in April, the AGEM index witnessed a more dramatic decrease in May 2012. With a composite value of 118.36 at the close of May (compared to 133.39 in April), the index fell by 15.03 points during the month (11.3 percent).
The last time a decline this significant was reported was in June 2010, when the index fell 14.69 points (14.2 percent). Ainsworth Game Technology (AGI), Lottomatica (LTO) and Multimedia Games (MGAM) were the only global gaming manufacturers to report an increase in stock price during the month, bucking broader sector movements.
For comparison purposes, the broader stock markets continued to decline during May 2012. The Dow Jones Industrial Average closed the month at 12,393. Although it had closing prices above 13,000 for the first week of the month, the index ended May down 6.2 percent when compared to the end of April.
The S&P 500 witnessed a decline of 6.3 percent over the month, falling to 1,310 from 1,398. Meanwhile, the NASDAQ reported the largest decline, falling 9.8 percent to 2,747 with closing prices above 3,000 reported for only three days.
Concerns about Eurozone financial stability and weaker-than-expected jobs reports contributed to a sell-off late in the month. The implications on the gaming equipment maker sector were evident during the latest report.
During May 2012, the index had one positive contributor as the weightings of key players in the index shifted with volatility in overall valuations. Multimedia Games (MGAM) contributed 0.28 points to the index, with a stock price increase of 11 percent to $12.61.
Selected negative contributors to the index included:
Konami (KNM) knocked down the index by 6.03 points, with a stock price of $21.06 (down 27.4 percent);
International Game Technology (IGT) contributed negative 2.52 points due to a decline in stock price of 8.2 percent to $14.30;
WMS Industries (WMS) reported a closing stock price of $20.53 (down 16.2 percent), resulting in a negative contribution of 1.33 points to the overall index.
The gaming industry in the north-eastern states continues to evolve. For years, Atlantic City, New Jersey has dominated the region and remained the second-largest gaming market in the US. Pennsylvania has followed as the second-largest market in the north-eastern region and the third-largest in the US. However, Pennsylvania’s gaming market is now threatening to surpass that of Atlantic City, while both will be facing increased competition from emerging markets in Ohio and Massachusetts.
Pennsylvania Casinos reported over $3bn gaming revenue, up 22 percent over 2010. Meanwhile, Atlantic City reported 2011 gaming revenue of $3.3bn, down 6.9 percent from 2010 and representing the market’s fifth consecutive year of annual decline.
Ohio recently celebrated the opening of two casinos in Cleveland and Toledo, and by next spring, two more will open in Cincinnati and Columbus.
Caesars Entertainment and Rock Gaming opened the $350m Horseshoe Casino on May 14th. Caesars Entertainment and Rock Gaming will also be opening a $400m casino in Cincinnati in 2013.
Penn National Gaming opened its $400m Hollywood Casino on May 29 in Toledo, Ohio. Penn National is hoping to open its $400-million Hollywood Casino in Columbus later this year.
Massachusetts is planning on licensing up to three casinos and a slot parlor. MGM Resorts International, Las Vegas Sands, Wynn Resorts and Caesars Entertainment were at one time competing for coveted licenses in the market.
AGEM is an international trade association representing manufacturers of electronic gaming devices, systems, and components for the gaming industry. The Association works to further the interests of gaming equipment manufacturers throughout the world.
Through political action, tradeshow partnerships, information dissemination and good corporate citizenship, the members of AGEM work together to create benefits for every company within the organization.
Association of Gaming Equipment Manufacturers – Website: AGEM.org
About the AGEM Index
The AGEM index and overview is prepared by Applied Analysis (AA). AA is a Nevada-based advisory services firm providing consultation services for public and private entities. The company utilizes extensive experience in economics, IT and finance to provide a wide range of services, including urban economic consulting, financial advisory services, market analysis, public policy analysis, gaming and technology consulting.
AGEM Gold Members:
Aristocrat Technologies, Aruze Gaming America, Austrian Gaming Industries, Bally Technologies, GTECH / Spielo International, International Game Technology (IGT), Intralot S.A., Konami Gaming, Scientific Games, Video Gaming Technologies (VGT), WMS Gaming
AGEM Silver Members:
Action Gaming, American Gaming Systems (AGS), Casino Technology, JCM Global, MEI, Multimedia Games, Shuffle Master, Suzo-Happ Group, TCSJohnHuxley and Wells-Gardner Electronics
AGEM Bronze Members:
Abbiati Casino Equipment, AC Slots (ACS), Acres 4.0, Ainsworth Game Technology, Alfastreet, Astro Corp., Bingotimes Technology, Cadillac Jack, Cammegh Limited, Cantor Gaming, Crane Payment Solutions / CashCode / Money Controls, Diamond Game, DigiDeal, Digital Display Group, Euro Games Technology (EGT), Galaxy Gaming, Gaming Partners International, Gaming Support, Glory (U.S.A) Inc., Incredible Technologies, Inspired Gaming, Interblock USA, Iverson Gaming Systems, JPM International, Jumbo Technology, Matsui Gaming Machine Co., Modern Gaming, Patriot Gaming & Electronics, Quixant Ltd., Reel Games, Rocket Gaming Systems, Table Trac, Tech Results, Warrior Gaming Associates
AGEM Associate Members:
3M Touch Systems, Advantech-Innocore, Assurance Ltd., Carmanah Signs, Casino Enterprise Management, Cole Kepro International, Cooper Levenson, Cybertec Gaming Systems, Daktronics, DiTronics Financial Services, DynaGraphic Printing, Elite Casino Products, Esterline Advanced Input Systems, Eurocoin, Flextronics, Fox Rothschild, FutureLogic, Gaming Capital Group, Gary Platt Manufacturing, Gemaco, Global Cash Access, Global Gaming Group (G3), Grand Products, Grand Products Nevada, Greenberg Traurig, Hanco Technologies, Howard & Howard, IDX, Intel, IPS, James Industries, KEY-BAK, Kontron, Leap Forward Gaming, Lewis & Roca, Lincoln Industries, Litemax Technology, Masterpiece Advertising, Nanoptix, Outpost Creative, Phelps Dunbar, Portwell, Proforma GPS, Rainmaker, Reel TV, Regulatory Management Counselors (RMC), Rye Park Gaming, Sanmina-SCI, SCA Gaming, Strategy9, Spin Games, StylGame USA, Talent Associates, The Bright Group, Tournament One, Trade Show Fabrications, TransAct Technologies, Trans-Lux, Veridocs, Wrex Products and Young Electric Sign Company (YESCO)