On Monday the International Game Technology (IGT) Board of Directors declared a reduced quarterly dividend of six cents from fourteen and a half cents. This will preserve around US$100 million in cash on an annualised basis. In yesterday’s press release company Chairman and CEO TJ Matthews stated, "In the current environment, we believe a revised dividend is the most prudent decision and in the best interest of IGT and our stakeholders."

He continued, "An unprecedented credit market environment and recessionary economic conditions have suppressed industry revenue expectations for the near term. Although the Company continues to generate strong cash flow, a reduction to the dividend will allow the Company to continue to return value to our shareholders at a competitive market rate and supports our efforts to fortify our balance sheet to ensure IGT is well-positioned to invest in growth opportunities over the long term."

The IGT move to cut the dividend by 58.6% seems to have been well received by the stock market and IGT shares rose by 8% on Tuesday morning. The majority of gaming companies have recently cut dividend payments completely. Although IGT has reduced its workforce by about 10% in the present economic downturn, the world’s largest slot machine and casino systems maker remains strong despite lower earnings last year. (E-03.04.09)

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