EX-99 5 exh_99c.txt EXHIBIT 99(C) W. Bruce Turner President & Chief Executive Officer Jaymin B. Patel Senior Vice President & Chief Financial Officer Fiscal Year 2004 - Second Quarter Earnings Conference CallSeptember 12, 2003 Safe Harbor Act. . . |X| Comments made during this presentation may contain forward-looking statements, including, without limitation, statements relating to the future operations and financial performance of the Company and the Company's future strategies. Such forward-looking statements reflect management's assessment based on information currently available, but are not guarantees and are subject to risks and uncertainties, which would cause the results to differ materially from those contemplated in the forward-looking statements. These risks and uncertainties include, but are not limited to, those set forth here and in the Company's filings with the SEC, including our Fiscal 2003 10K and subsequent filings. Agenda. . . |X| W. Bruce Turner, Chief Executive Officer o Welcome o Q2 and YTD Performance Review o Strategic Progress Report o Status of Acquisitions |X| Jaymin B. Patel, Chief Financial Officer o Review of Q2 and YTD Financial Results o Updated Guidance for Fiscal Year 2004 and Q3 FY'04 Customer Successes. . .
Base Term Points Base Term Contract Value of Sale [Extensions] ($ in millions) (in thousands) (in years) ------------------------ ------------------------ ------------------ Rhode Island 700 4.3 20 Florida 160 9.1 6[4] Michigan 145 7.8 5 Trinidad & Tobago 70 0.7 5[2] Wisconsin 50 3.3 5[4] Sweden 20 10.0 2 New Zealand 5 0.9 5[3] Idaho* 5 0.5 3 *Department of Fish & Game
Before ES With ES ----------------------------------- ------------------------------------- Single terminal Points of Access... Traditional lottery, Lottery Inside, SSTs, Interactive ----------------------------------- ------------------------------------- ----------------------------------- ------------------------------------- Limited reusability and Middleware... Substantial reusability and much flexibility improved flexibility ----------------------------------- ------------------------------------- ----------------------------------- ------------------------------------- General purpose transaction engine driving: Lottery Fish & Game Primarily lottery Applications... Bill Payments Pre-paid Top-ups Business Management Support ----------------------------------- -------------------------------------
Fiscal Year 2004 - Second Quarter Earnings Call Lottery Contract Rebid Summary. . . |X| Completed major rebid cycle |X| Secured $800 million of annual recurring service revenues |X| Long-term contracts provide visible and predictable service revenue and cash flow streams. . . o Average contract length approximately 6 years (including extensions) |X| Over 85% of FY'05 service revenues under contract Fiscal Year 2004 - Second Quarter Earnings Call Acquisition Update. . . |X| Polcard o Deal closed in May o Integration on track |X| Interlott o Shareholder meeting on September 17th o Expected to close September 18th |X| Interlott Q2 results o Quarterly revenues +21% o Increased earnings per share Fiscal Year 2004 - Second Quarter Earnings Call Key Financial Highlights. . . Q2 FY'04 vs FY'03
|X| Total Revenue +26% o Service Revenues +13% Strong same store sales |X| Gross Profits +29% o Service gross profits +24% Robust margins - 44.2% |X| Operating Income +25% |X| Net Income +27% |X| Diluted Earnings Per Share +12% Reflects impact of convertible bond
Fiscal Year 2004 - Second Quarter Earnings Call Service Revenue Analysis. . . Q2 FY'04 vs FY'03
U.S. International Lottery Lottery Commercial Services GTECH Total $M % $M % $M % $M % ------------ ---------- ------------- ------------- ------------ ---------- ---------- --------- FY'03 121 77 13 211 Same Store Sales 6 +5% 9 +11% 1 +11% 16 +7% Net, All Other* 3 +3% 2 +2% 6 +46% 11 +6% FY'04 130 +8% 88 +13% 20 +57% 238 +13% *Reflects contract wins, jackpot activity, contractual rate changes, foreign exchange changes
Fiscal Year 2004 - Second Quarter Earnings Call
Key Financial Highlights. . . Q2 FY'04 vs FY'03 |X| Total Revenue +26% o Service Revenues +13% Strong same store sales |X| Gross Profits +29% o Service gross profits +24% Robust margins - 44.2% |X| Operating Income +25% |X| Net Income +27% |X| Diluted Earnings Per Share +12% Reflects impact of convertible bond
Fiscal Year 2004 - Second Quarter Earnings Call Cash Flow. . . Q2 FY'04 [GRAPHIC OMITTED] Fiscal Year 2004 - Second Quarter Earnings Call FY'04 YTD Revenues. . . [GRAPHIC OMITTED] Fiscal Year 2004 - Second Quarter Earnings Call Cash Flow. . . YTD FY `04 [GRAPHIC OMITTED] Fiscal Year 2004 - Second Quarter Earnings Call Return on Capital Employed. . . Six months ended August 23, 2003 [GRAPHIC OMITTED] Fiscal Year 2004 - Second Quarter Earnings Call FY'04 Guidance. . . As of September 12, 2003 FY'04 ------------------------------------------------------------------------ Service Revenue Growth 1 7% - 8% Product Sales 1 $120M - $130M Service Gross Profit Margins 42% - 44% Product Sales Gross Profit Margins 32% - 34% Earnings per Share Excluding One-Time Gain 2 $2.65 - $2.75 Reported Earnings per Shar e2 $2.70 - $2.80 Net Cash Invested $370M - $380M 1 Includes acquisition of PolCard and Interlott 2 Based on Diluted Share Estimate of 65.0M Shares, reflecting impact of convertible bond dilution Fiscal Year 2004 - Second Quarter Earnings Call Q3 FY'04 Guidance. . . As of September 12, 2003 Q3 FY'04 -------------------------------------------------------------------------------- Service Revenue Growth 1 8% - 10% Product Sales 1 $40M - $45M Service Gross Profit Margins 40% - 42% Product Sales Gross Profit Margins 36% - 38% Earnings per Share Excluding One-Time Gain 2 $0.55 - $0.60 Reported Earnings per Share 2 $0.60 - $0.65 1 Includes acquisition of PolCard and Interlott 2 Based on Diluted Share Estimate of 66.7M Shares, reflecting impact of convertible bond dilution