Reductions in consumer card use at casinos is adversely affecting Global Cash Access Holdings Inc.’s financial performance.
The Los Angeles company provides cash access products and services in more than 1,100 casinos through automated teller machines, point of sale debit card transactions, credit card cash advances and check-warranty services.
Global Cash reported net income of $6 million for the second quarter, down 34.1% from a year earlier. Revenue fell 9.1%, to $157.2 million.
ATM revenue was $80.6 million, down 4.7%, largely due to a 5.6% drop in year-over-year transaction volume, Scott Betts, Global Cash’s president and chief executive, said during a conference call last week to discuss the results.
Check-service revenue dropped 24.8%, to $7.9 million, as casino patrons wrote fewer checks. Cash advance revenue totaled $64 million, down 14.4%.
Betts acknowledged weak revenue at casinos, and predicted that “same-store” revenue will fall in the “mid-single digits” for the rest of the year after dropping by 7% during the first half.
“The rate of decline is certainly slowing down significantly, from the double-digit rates that we experienced in 2009, and that is certainly good news,” he said.
