Despite announcing a net loss of US$14.4 million for the quarter ended 30 June 2006, Progressive Gaming International Corporation (PGIC) reported an increase in system revenue due to new installations of CasinoLink in international jurisdictions and more demand for progressive jackpot and mystery systems products. The losses were attributed to charges related to severance, relocation and provisions for certain legal and tax matters. Second quarter revenue was US$15.3 million, a decline of US$3.3 million over the same period of 2005.

President and Chief Executive Officer Russel McMeekin stated: "As anticipated, revenues from our strategic initiatives are beginning to ramp up now that we have entered the second half of the calendar year. We are not only signing customer contracts but are undergoing significant customer installation activities. These planned installations are expected to drive new incremental revenues with compelling recurring revenue components. Our strategic initiatives remain on track.”

PGIC is a leading supplier of Integrated Casino Management Systems Software and Games for the gaming industry worldwide. It is estimated that every casino in the world uses at least one of its products. The Company is unique in the industry in offering management, progressive systems and games as a modular yet integrated solution. Although systems revenues have shown solid growth patterns, PGIC has recorded only modest revenues related to its new CasinoLink Jackpot System (CJS) Intelligent Table System (ITS) and central-server based gaming products in the first half of 2006, due mainly to timing issues relating to regulatory approvals. Scheduled installations of these products in the second half of the year is expected to drive more growth in system revenues in late 2006 and beyond.

Mr McMeekin commented, “"An important component to our growth is our ability to establish the right business partners and customers. During the second quarter, we announced a strategic partnership with Cantor Gaming, a subsidiary of Cantor Fitzgerald, for mobile gaming. We also established a master purchase agreement for CJS with a large casino operator. With the addition of these exciting partnerships, we now have world class partners and customers tied to each of these strategic growth initiatives."
(E-08.08.06)

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