Paul-Son Gaming Reports Financial Results for the Second QuarterAnd First Six Months of Fiscal 2001

LAS VEGAS, Jan. 16 /PRNewswire/ -- Paul-Son Gaming Corporation (Nasdaq: PSON), a leading manufacturer and supplier of casino table game equipment in North America, today reported financial results for the second quarter and six months ended November 30, 2000.

For the second quarter, the Company reported a net loss of $466,000, equal to $.14 per share, compared to a net loss of $1,129,000, or $.33 per share for the corresponding quarter of the prior fiscal year. Second quarter sales totaled $5,112,000, compared with $4,906,000 for the same period a year ago.

On an operating basis, the loss for the most recent quarter narrowed to $448,000 from $566,000 in the like quarter of the prior year. The net loss for the prior year reflected a tax provision of approximately $557,000, or $.16 per share. Results for the most recent quarter included severance costs of approximately $50,000 associated with the Company's program to reduce overhead expenses.

The Company experienced a net loss for the six months ended November 30, 2000 of $733,000, equal to $.21 per share, versus a net loss of $1,110,000, or $.32 per share in the first half the previous fiscal year. Operating losses for the six months ended November 30, 2000 and 1999 were $676,000 and $566,000, respectively. First half sales were $10,421,000, compared with $11,263,000 one year ago.

Eric P. Endy, Chairman and Chief Executive Officer, commented: "We recorded modestly higher second quarter sales, compared with the same months of the previous year, reflecting some growth in shipments due to new casino openings and expansions. Despite this growth, we continue to see a slow pace of casino openings and expansions relative to previous years. We are focused on pursuing improved sales despite this sluggish climate.

"All of our efforts are directed at enhancing operations with the goal of returning the Company to profitability. In line with that objective, we continue to implement overhead expense reductions, both in our manufacturing and selling, general and administrative areas. SG&A expenses were reduced in both the second quarter and first six months of the current fiscal year, compared with the prior year periods. Financial results of future periods will benefit from additional overhead reductions, which we have recently put into effect."

Paul-Son is a leading manufacturer and supplier of casino table game equipment in North America with manufacturing facilities in San Luis, Mexico, and, to a limited extent, Las Vegas, Nevada.

This press release may contain certain forward-looking statements which are subject to change. The actual results may differ materially from those described in any forward-looking statements. Additional information concerning potential factors that could affect the company's financial results are included in the company's form 10-K for the year ended May 31, 2000.

PAUL-SON GAMING CORPORATION

Financial Highlights (Unaudited)

For the 3 months ended For the 6 months ended

11/30/00 11/30/99 11/30/00 11/30/99

Revenues $5,112,000 $4,906,000 $10,421,000 $11,263,000

Cost of revenues 4,056,000 3,827,000 8,106,000 8,574,000

Gross profit 1,056,000 1,079,000 2,315,000 2,689,000

Gross profit

percentage 20.7% 22.0% 22.2% 23.9%

Selling, general and

administrative

expenses 1,504,000 1,635,000 2,991,000 3,255,000

Operating loss (448,000) (556,000) (676,000) (566,000)

Other, net (18,000) (16,000) (57,000) 24,000

Loss before income

taxes (466,000) (572,000) (733,000) (542,000)

Income tax expense -- 557,000 -- 568,000

Net loss $(466,000) $(1,129,000) $(733,000) $(1,110,000)

Net loss per basic

and diluted share $(0.14) $(0.33) $(0.21) $(0.32)

Weighted average

diluted common

shares

outstanding 3,449,757 3,454,537 3,451,210 3,455,150

Balance Sheet (Unaudited)

ASSETS 11/30/00 5/31/00

Cash and cash equivalents $1,750,000 $2,072,000

Accounts receivable, net 2,240,000 2,299,000

Inventories, net 3,047,000 4,146,000

Prepaid expenses and other current assets 406,000 265,000

Total current assets 7,443,000 8,782,000

Property, plant and equipment, net 8,169,000 8,396,000

Other assets 651,000 578,000

Total assets $16,263,000 $17,756,000

LIABILITIES AND EQUITY

Accounts payable and accrued liabilities $1,671,000 $1,597,000

Customer deposits 139,000 199,000

Income taxes payable 53,000 23,000

Current portion of long-term debt 1,206,000 1,900,000

Total current liabilities 3,069,000 3,719,000

Long-term debt 565,000 667,000

Stockholders' equity 12,629,000 13,370,000

Total liabilities and stockholders equity $16,263,000 $17,756,000

SOURCE Paul-Son Gaming Corporation

CO: Paul-Son Gaming Corporation

ST: Nevada, Mexico

IN: CNO

SU: ERN

01/16/2001 08:02 EST http://www.prnewswire.com