Gtech Holdings Corp., anoperator of lottery games and systems, risks hurting its profit
next year after undercutting a rival to win a contract, the Wall
Street Journal said in its “Heard on the Street” column.
Gtech bid $216 million over six years to renew its
Californian lottery contract. That’s $50 million less than the
highest offer from rival Scientific Games Corp. and $20 million
less than Gtech’s old contract, the paper said.
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“It’s hard to see how they can make money in California,”
said P.J. Solit of Potomac Capital partners, a New York hedge
fund, according to the Journal.
Gtech, which handles 23 U.S. state lotteries, releases second-
quarter earnings today. It expects profit for the quarter ended
Aug. 24 doubled to $38.2 million, or 66 cents a share, from $16.6
million, or 28 cents, a year earlier, the Journal said.
Bloomberg
