<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1997
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from __________ to __________.
Commission file number 0-22482.
INNOVATIVE GAMING CORPORATION OF AMERICA
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Minnesota 41-1713864
- ------------------------------- ------------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
4750 Turbo Circle, Reno, Nevada 89502
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices)
(702) 823-3000
- --------------------------------------------------------------------------------
(Issuer's Telephone Number, Including Area Code)
- --------------------------------------------------------------------------------
(Former Address, If Changed Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
----- -----
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: At May 9, 1997 there were 6,476,515
shares of common stock, $0.01 par value, outstanding.
Page 1 of 13
<PAGE> 2
INNOVATIVE GAMING CORPORATION OF AMERICA
Form 10-Q Index
March 31, 1997
<TABLE>
<S> <C>
Part I: Financial Information
Item 1. Financial Statements
Consolidated Condensed Balance Sheets -
March 31, 1997 and December 31, 1996 (Unaudited) 3
Consolidated Condensed Statements of Operations -
for the three months ended
March 31, 1997 and 1996 (Unaudited) 4
Consolidated Condensed Statements of Cash Flows -
for the three months ended
March 31, 1997 and 1996 (Unaudited) 5
Notes to Consolidated Condensed
Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9
Part II: Other Information
Item 1. Legal Proceedings 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
</TABLE>
Page 2 of 13
<PAGE> 3
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
CONSOLIDATED CONDENSED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
----------------- -----------------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $2,143 $2,993
Available-for-sale securities 2,252 2,966
Restricted investments 1,000 1,000
Accounts receivable 526 483
Current portion of notes receivable 90 177
Inventories 5,200 4,729
Prepaid expenses and other 257 174
----------------- -----------------
Total current assets 11,468 12,522
PROPERTY AND EQUIPMENT, NET 858 653
DEFERRED INCOME TAXES 720 720
INTANGIBLE ASSETS, NET 1,993 2,081
----------------- -----------------
$15,039 $15,976
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $557 $246
Accrued liabilities 286 254
Notes payable 16 26
----------------- -----------------
Total liabilities 859 526
----------------- -----------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value, 100,000,000 shares authorized,
6,476,515 shares issued and outstanding 65 65
Additional paid-in capital 24,951 24,951
Accumulated deficit (10,835) (9,559)
Unrealized holding gain (loss) on available-for-sale securities (1) (7)
----------------- -----------------
Total stockholders' equity 14,180 15,450
----------------- -----------------
$15,039 $15,976
================= =================
</TABLE>
See Notes to Consolidated Condensed Financial Statements.
Page 3 of 13
<PAGE> 4
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months
Ended March 31,
------------------------------------
1997 1996
----------------- -----------------
<S> <C> <C>
SALES $467 $506
COST OF SALES 399 374
----------------- -----------------
Gross profit 68 132
SELLING, GENERAL AND ADMINISTRATIVE 1,429 1,213
----------------- -----------------
Loss from operations (1,361) (1,081)
INTEREST INCOME, NET 85 177
----------------- -----------------
NET LOSS (1,276) (904)
================= =================
LOSS PER COMMON SHARE
AND COMMON SHARE EQUIVALENTS:
PRIMARY AND FULLY DILUTED ($0.20) ($0.15)
================= =================
WEIGHTED AVERAGE
COMMON SHARES OUTSTANDING 6,477 6,150
================= =================
</TABLE>
See Notes to Consolidated Condensed Financial Statements.
Page 4 of 13
<PAGE> 5
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months
Ended March 31,
-------------------------------
1997 1996
--------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($1,276) ($904)
Adjustments to reconcile net loss to
cash flows from operating activities -
Depreciation and amortization 139 119
Provision for inventory obsolescence 35 --
Loss on sale of securities and investments 2 17
Stock option compensation earned -- 1
Changes in operating assets and liabilities (200) 727
--------------- --------------
Cash flows from operating activities (1,300) (40)
--------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of securities and investments (1,043) (4,832)
Proceeds from sale of securities and investments 1,759 4,704
Purchases of property and equipment (256) (239)
Payments on non-compete agreement -- (17)
--------------- --------------
Cash flows from investing activities 460 (384)
--------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable (10) (1)
Net proceeds from sale of common stock -- 354
--------------- --------------
Cash flows from financing activities (10) 353
--------------- --------------
DECREASE IN CASH AND CASH EQUIVALENTS (850) (71)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 2,993 897
--------------- --------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $2,143 $826
=============== ==============
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION:
Cash paid for interest -- $3
Cash paid for income taxes $1 $3
Noncash transactions:
Class B common stock converted to common stock -- $10
Intangible assets acquired with common stock -- $2,081
</TABLE>
See Notes to Consolidated Condensed Financial Statements.
Page 5 of 13
<PAGE> 6
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 1997
(UNAUDITED)
(1) BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying unaudited consolidated condensed financial statements have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. Although management believes that the disclosures are adequate to
make the information presented not misleading, it is suggested that these
interim consolidated condensed financial statements be read in conjunction with
the Company's most recent audited consolidated financial statements and notes
thereto included in the Company's Annual Report to Shareholders and Form 10-K
for the year ended December 31, 1996. In the opinion of management, all
adjustments (including recurring adjustments) necessary for a fair presentation
of the financial position, results of operations and cash flows for the interim
period presented have been made. Operating results for the three months ended
March 31, 1997 are not necessarily indicative of the results that may be
expected for the year ending December 31, 1997.
(2) COMMITMENTS AND CONTINGENCIES
The manufacture, distribution and sale of the Company's products are regulated
by various jurisdictions and entities, including requirements to obtain licenses
and product approval in several jurisdictions. The Company has obtained required
licenses and product approvals in certain jurisdictions and is continuing
efforts to obtain such approvals in other key jurisdictions. Failure to
successfully obtain and/or maintain such licenses and approvals, or meet other
regulatory requirements could materially impact the expansion and future
operation of the Company. As a result, the Company expects quarterly results to
be volatile until all product approvals have been obtained and appropriate
marketing efforts have been performed in major gaming markets. Until all major
gaming market approvals are received and marketing efforts performed, future
sales and earnings are expected to continue to be negatively impacted.
(3) RELATED PARTY TRANSACTIONS
Grand Casinos, Inc. ("GCI"), which is in the business of owning, managing and
developing casinos, is a stockholder of the Company. Lyle Berman, a director of
the Company, is Chairman and Chief Executive Officer, and a principal
shareholder of GCI. Under an existing discount machine purchase agreement, GCI
may purchase up to an aggregate of 125 games at specified discount prices.
Previous sales were made to GCI at reduced prices for the purpose of testing,
evaluating and marketing the Company's blackjack, craps and roulette games. The
Company made no sales to GCI during the quarters ended March 31, 1996 or 1997.
(4) COMMON STOCK
On October 20, 1994, the Company's Board of Directors authorized the Company to
repurchase up to 500,000 shares of its currently outstanding common stock from
time to time on the open market or in privately negotiated transactions
depending on market conditions. As of March 31, 1997, the Company had
repurchased 248,500 shares at prices ranging from $3.56 to $6.08 per share for
total consideration of $1,199,000. No shares were repurchased during the
quarters ended March 31, 1996 or 1997.
(5) INCOME TAXES
The Company has adopted Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes", under which deferred income tax assets and
liabilities are recognized for differences between financial and income tax
reporting basis of assets and liabilities based on currently enacted rates and
laws. The Company had cumulative
Page 6 of 13
<PAGE> 7
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - CONTINUED
MARCH 31, 1997
(UNAUDITED)
federal net operating loss carry forwards of approximately $8,385,000 as of
December 31, 1996. These losses, if not used, will begin to expire in 2009. The
use of approximately $1,250,000 of these losses is limited to approximately
$250,000 per year for the next five years because the loss was generated in a
short tax year. Future changes in the ownership of the Company may place
limitations on the use of these net operating loss carry forwards.
(6) SUBSEQUENT EVENT - PREFERRED STOCK PRIVATE PLACEMENT
On April 9, 1997, the Company issued 4,000 shares of Series A Convertible
Preferred Stock (the "Preferred Stock") at a price of $1,000 per share in a
private placement. The Company received net proceeds of approximately $3,790,000
from such private placement after the payment of fees and expenses associated
with such private placement. An annual dividend of 4% on such Preferred Stock
shall be paid quarterly in arrears either in Common Stock of the Company or cash
at the Company's discretion.
Page 7 of 13
<PAGE> 8
INNOVATIVE GAMING CORPORATION OF AMERICA AND SUBSIDIARY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - CONTINUED
MARCH 31, 1997
(UNAUDITED)
The Preferred Stock is convertible into shares of the Company's Common Stock at
a conversion price of 82% of the average closing bid price of the Company's
Common Stock over the ten-day trading period ending the day prior to conversion
(the "Conversion Price"). The Conversion Price may not exceed $8.1725 per share.
Twenty-five percent (25%) of the Preferred Stock is convertible into Common
Stock, at the election of the holder thereof, at the later of July 9, 1997 or
the date of effectiveness of the Registration Statement with the Securities and
Exchange Commission (the "Effective Date") and all necessary gaming regulatory
approvals. Twenty-five percent (25%) of the Preferred Stock is convertible 30
days after the Effective Date; (25%) of the Preferred Stock is convertible 60
days after the Effective Date; and the remaining (25%) of the Preferred Stock is
convertible 90 days after the Effective Date. All outstanding shares of
Preferred Stock will automatically be converted into Common Stock eleven months
following the Effective Date. A holder of Preferred Stock may not convert such
stock into Common Stock if, following such conversion, the holder beneficially
owns in excess of 4.9% of the Company's Common Stock.
A Registration Statement related to the Common Stock is being filed by, and at
the expense of, the Company pursuant to obligations contained in a Registration
Rights Agreement dated April 10, 1997. The Company must use its best efforts to
have the Registration Statement be declared effective with the SEC no later than
90 days from the closing of the purchase of the Preferred Shares. If the
Registration Statement is not delared effective within 120 days after the
closing, the Company is required to pay to the holders of Convertible Preferred
Stock the an amount equal to 2% of the subscription price paid by the investors
at 150 days after the closing, and 3% for each 30 days subsequent to the first
payment, to be prorated for periods less than 30 days.
Page 8 of 13
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
The Company was formed in 1991 to develop, manufacture, market and distribute
group participation and other specialty video gaming machines. The Company
manufactures, distributes and markets electronic blackjack, craps, roulette and
progressive blackjack machines to gaming markets worldwide. Since inception, the
Company has focused most of its resources on the regulatory approval process and
the sale and installation of its machines and the development of other products.
In February 1997, the Company received technical game approval for its
multi-station blackjack machine from Colorado regulatory authorities. The
Company, through its Colorado distributor, Vista Gaming Corporation, commenced
placing its blackjack games in Colorado casinos on a lease basis in late
February 1997. In February and March 1997, the Nevada Gaming Commission granted
the Company approval of its Hot Shot DiceTM , BJ BlitzTM and Lightning StrikeTM
Roulette machines for use in Nevada. The Company has commenced placing these
games in Nevada casinos where possible on a lease "participation" basis wherein
the Company will receive a percentage of the games' net win at percentages
similar to those received by other specialty game suppliers in casino locations.
The Company and Grand Casinos, Inc. ("GCI") have entered into an agreement which
will allow casinos owned or managed by GCI or its affiliates to purchase up to
125 of the Company's video gaming machines at prices lower than the price the
Company charges unrelated parties. From inception through March 31, 1997, the
Company has sold 42 blackjack machines, 11 craps machines and 8 roulette
machines to casinos either owned or managed by GCI. There were no machines sold
to GCI for the three months ended March 31, 1997.
The Company distributes its products both directly to the gaming marketplace and
through licensed distributors. In certain jurisdictions, the Company has
received technical game approval but has not sought or received its
distributor's license. In certain jurisdictions the Company may use an existing
licensed distributor to sell its products pursuant to any necessary Tribal or
regulatory transaction approvals. The Company has, and/or intends to apply for
necessary licenses or technical approvals in key jurisdictions both domestically
and internationally where Class III type gaming is permitted.
The Company has exclusive or nonexclusive distributorship agreements with
Aristocrat Leisure Industries PTY LTD, Bally Gaming International, Drew
Distributing, Ludi S.F.M., S.A.M. Eurusa, Sodak Gaming Inc. and Vista Gaming
Corporation. Ludi is affiliated with Eurusa.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED
MARCH 31, 1997 COMPARED TO MARCH 31, 1996
For the three month period ended March 31, 1997, the Company recorded a net loss
of $1,276,000, or $.20 per share. This loss was the result of low sales volume
while pursuing licensing and the introduction of those products into new
markets, while expense levels were high due to the Company's efforts to
develop/enhance its products.
SALES, COST OF SALES AND GROSS PROFIT
Sales for the quarter ended March 31, 1997, were $467,000 compared to $506,000
recorded in the quarter ended March 31, 1996. Net sales included 6 games in both
the current and prior year quarters. Regulatory timing delays in acquiring
certain gaming licenses in key jurisdictions limited the markets available to
sell the Company's products. The Company recognized minimal lease revenues from
the placement of games in Colorado and Nevada casinos late in the current
Page 9 of 13
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS - CONTINUED
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED
MARCH 31, 1997 COMPARED TO MARCH 31, 1996 - CONTINUED
quarter, subsequent to receiving regulatory approval in those jurisdictions.
Sales will continue to be volatile while new jurisdictional licenses and/or
distribution agreements are obtained. The Company is pursuing game approval in
the key jurisdiction of Australia.
The gross margin for the first quarter of 1997 was 14.6% compared to 26.1% for
the first quarter of 1996. The lower gross margin in 1997 was primarily due to
the accrual of obsolescence reserves and costs associated with commencement of
leasing games to casinos.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expense for the three months ended March 31,
1997 increased $216,000 to $1,429,000 compared to $1,213,000 for the three
months ended March 31, 1996. This expense increase was primarily due to higher
product engineering and development expenses related to preparing the Company's
products for introduction into new jurisdictions, and increased payroll
expenses.
INTEREST INCOME
In the quarter ended March 31, 1997, interest income was $85,000 compared to
$177,000 in the quarter ended March 31, 1996. The decrease in interest income
was due to a decrease in notes receivable and investments in interest bearing
accounts.
ACCUMULATED DEFICIT
The Company had an accumulated deficit of $10,835,000 as of March 31, 1997. Due
to the highly regulated environment in which the Company operates, the
likelihood of future profitable quarters cannot be predicted. Future results are
highly dependent on the Company's ability to obtain the necessary licenses
and/or product approvals in various jurisdictions in order to expand its market
base. There can be no assurance as the time frame during which such anticipated
approvals may occur due to uncertain time periods involved in the regulatory
approval process. Due to the unique nature and prices of the Company's products,
it is difficult to predict the appropriate selling cycle time frame involved in
each new jurisdiction.
As a result of these factors, the Company expects quarterly results to be
volatile until licenses and approvals are obtained in certain major gaming
markets and appropriate marketing efforts can be performed in new jurisdictions.
The Company has experienced delays in acquiring certain gaming licenses in key
jurisdictions. Future sales and earnings levels are expected to continue to be
negatively impacted until licenses are acquired in key new jurisdictions.
LIQUIDITY AND CAPITAL RESOURCES
The Company has a $1,000,000 standby letter of credit/revolving credit
arrangement primarily to facilitate acquisition of components and supplies from
foreign vendors. The facility is collateralized by short-term investments of the
Company.
On October 20, 1994, the Company's Board of Directors authorized the Company to
repurchase up to 500,000 shares of its currently outstanding common stock from
time to time on the open market or in privately negotiated transactions,
depending on market conditions. As of March 31, 1997, the Company had
repurchased 248,500 shares at prices ranging from $3.56 to $6.08 per share for
total consideration of $1,199,000. No shares were repurchased during the three
months ended March 31, 1996 or 1997.
Page 10 of 13
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS - CONTINUED
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED
MARCH 31, 1997 COMPARED TO MARCH 31, 1996 - CONTINUED
On April 9, 1997, the Company issued 4,000 shares of Series A Convertible
Preferred Stock at a price of $1,000 per share in a private placement for total
proceeds of $4,000,000. The Company received net proceeds of approximately
$3,790,000 from such private placement after the payment of fees and expenses
associated with such private placement. An annual dividend of 4% shall be paid
quarterly in arrears either in Common Stock of the Company or cash at the
Company's discretion.
Each share of Preferred Stock is convertible into shares of the Company's Common
Stock at a conversion price of 82% of the average closing bid price of the
Company's Common Stock over the ten-day trading period ending the day prior to
conversion (the "Conversion Price"). The Conversion Price may not exceed $8.1725
per share. Twenty-five percent (25%) of the Preferred Stock is convertible into
Common Stock, at the election of the holder thereof, at the later of July 9,
1997 or the date of effectiveness of the Registration Statement with the
Securities and Exchange Commission (the "Effective Date") and all necessary
gaming regulatory approvals. Twenty-five percent (25%) of the Preferred Stock is
convertible 30 days after the Effective Date; (25%) of the Preferred Stock is
convertible 60 days after the Effective Date; and the remaining (25%) of the
Preferred Stock is convertible 90 days after the Effective Date. All outstanding
shares of Preferred Stock will automatically be converted into Common Stock
eleven months following the Effective Date. A holder of Preferred Stock may not
convert such stock into Common Stock if, following such conversion, the holder
beneficially owns in excess of 4.9% of the Company's Common Stock. A
Registration Statement related to the Common Stock is being filed by, and at the
expense of, the Company pursuant to obligations contained in a Registration
Rights Agreement dated April 10, 1997.
The Company had $5,395,000 and $6,959,000 in cash and cash equivalents,
available-for-sale securities and restricted investments as of March 31, 1997
and December 31, 1996, respectively. The Company believes that its cash and cash
equivalents, available-for-sale securities and restricted investments, and
additional financing capacity will be sufficient to meet the Company's current
liquidity and capital requirements. These resources and cash generated from
operations are expected to meet the Company's long-term capital requirements.
The Company had no long-term debt as of March 31, 1997.
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
The foregoing Management's Discussion and Analysis contains various
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Sections 21E of the Securities Exchange Act of
1934, as amended, which represent the Company's expectations or beliefs
concerning future events, including statements regarding the Company's timetable
of game approval in Australia. In addition, statements containing expressions
such as "believes," "anticipates," "hopeful" or "expects" used in the Company's
periodic reports on Forms 10-K and 10-Q filed with the SEC are intended to
identify forward looking statements. The Company cautions that these and similar
statements included in this report and in previously filed periodic reports
including reports filed on Forms 10-K and 10-Q are further qualified by
important factors that could cause actual results to differ materially from
those in the forward-looking statement, including, without limitation, the
following: decline in demand for gaming products or reduction in the growth rate
of new markets; increased competition; the effect of economic conditions; a
decline in the market acceptability of gaming; political and economic
instability in developing international markets; a decrease in the desire of
established casinos to upgrade machines in response to added competition from
newly constructed casinos; the loss of a distributor; changes in interest rates
causing a reduction on investment income or in the market interest rate
sensitive investments; loss or retirement of key executives; approval of pending
patent applications or infringement upon existing patents; the effect of
regulatory and governmental actions; unfavorable determination of suitability by
regulatory authorities with respect to officers, directors or key employees; the
limitation, conditioning or suspension of any gaming license; adverse results of
significant litigation matters; fluctuation in exchange rates, tariffs and other
barriers. Many of the foregoing factors have been discussed in the Company's
prior SEC filings and, had the amendments to the Securities Act of 1933 and
Securities Exchange Act of 1934 become effective at a different time, would have
been discussed in an earlier filing.
Page 11 of 13
<PAGE> 12
PART II
OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule - which is only submitted
electronically to the Securities and Exchange Commission for EDGAR
information purposes.
(b) Reports on Form 8-K
On April 11, 1997, the Company filed a Form 8-K to report completion of
a private placement of convertible preferred stock.
Page 12 of 13
<PAGE> 13
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
INNOVATIVE GAMING CORPORATION OF AMERICA
/s/ Scott Shackelton
-------------------------------------------------
Scott Shackelton
Chief Financial Officer
(Principal Accounting Officer)
Date: May 14, 1997
Page 13 of 13
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
- -------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,143
<SECURITIES> 3,252
<RECEIVABLES> 616
<ALLOWANCES> 0
<INVENTORY> 5,200
<CURRENT-ASSETS> 11,468
<PP&E> 858
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,039
<CURRENT-LIABILITIES> 859
<BONDS> 0
0
0
<COMMON> 65
<OTHER-SE> 14,115
<TOTAL-LIABILITY-AND-EQUITY> 15,039
<SALES> 467
<TOTAL-REVENUES> 467
<CGS> 399
<TOTAL-COSTS> 399
<OTHER-EXPENSES> 1,429
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (85)
<INCOME-PRETAX> (1,276)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,276)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,276)
<EPS-PRIMARY> (.20)
<EPS-DILUTED> (.20)
</TABLE>
