Bally Technologies Inc., the second-largest U.S. maker of slot machines, lowered its fiscal 2011 earnings forecast and announced a tender offer to buy back $400 million in stock.
The company, based in Las Vegas, cut its fiscal 2011 forecast to $1.82 to $1.95 a share, from its prior guidance of $2 to $2.15, citing installation delays and lower than expected systems revenue. U.S. casinos are spending more carefully as they emerge from record declines in gambling during the recession and financial crisis.
Bally’s board approved a new $550 million share repurchase program, including a $400 million modified Dutch auction for stock priced between $34.50 and $40 a share, the company said today in separate statements. Bally said it had arranged $700 million in new loans, including a $400 million five-year revolving credit facility.
The timing of large system installations is “becoming more challenging to predict,” Chief Executive Officer Richard M. Haddrill said today in a statement.
Bally competes with International Game Technology, the largest U.S. slot machine maker, WMS Industries Inc. and Australia’s Aristocrat Leisure Ltd., to develop and sell gambling machines and software.
Bally’s shares fell 51 cents, or 1.3 percent, to $37.68 at 4 p.m. in trading on the New York Stock Exchange. The shares are down 11 percent this year.