AC Coin keeps winning, even as casinos are losing
By DONALD WITTKOWSKI
Staff Writer, 609-272-7258
Published: Monday, December 01, 2008
PLEASANTVILLE - Mac Seelig, the founder of AC Coin & Slot, did not sound very worried.Yes, the economy is poor and the casinos are mired in a slump, but he's been through it before - in the 1970s, '80s and '90s. It seems every decade there's a downturn."This is the third time I've seen something similar," Seelig said of the current economic crisis. "But the operators usually figure it out."Casino operators from Atlantic City to Las Vegas are struggling to survive in what may be the industry's most difficult time ever. Somehow, Pleasantville-based AC Coin has avoided the economic woes befalling the rest of the gaming business, including the slot machine suppliers.While most of the industry has been shrinking, AC Coin plans to boost production by 30 percent next year as it continues to develop new slot games in a highly competitive market.
"I think our goal as a company is to make the best revenue-producing slot machines in the country. We are launching product after product to have the highest-earning games in the industry," said Jeff Seelig, AC Coin's chief financial officer and one of Mac Seelig's three sons who help run the family owned business.AC Coin, however, has gone through some downsizing in what company officials say is an effort to become leaner and more efficient. Its work force has dropped from 280 to 250 employees in this, its 30th year of business, Jeff Seelig said.Although the casino industry has slowed down nationwide recently, the explosive growth of gaming in years past has allowed AC Coin to put its slot machines in 280 casinos in the United States, Canada and the Caribbean. AC Coin is one of the largest privately owned slot manufacturers and casino supply companies in the world. It also serves as the exclusive distributor of industry giant International Game Technology's slot machines in Atlantic City and the Caribbean.The company doesn't release revenue figures, but Jeff Seelig said AC Coin expects to break even this year. AC Coin is one of the few standouts in today's troubled gaming industry. Overall, gaming revenue has tumbled 2.6 percent in the 12 states that have commercial casinos. Atlantic City is down 6.6 percent in the first 10 months this year."I think the industry was growing at a rate that was off the charts. This will be the first negative year forever," Jeff Seelig said. "An industry that had been growing at a rate of about 15 to 20 percent is now flat."Justin T. Sebastiano, a casino analyst for Morgan Joseph & Co. Inc., said gaming suppliers certainly are under pressure in the economic crunch. But he is convinced that slot companies will avoid a major loss of business because they are simply too important to the casinos."We believe this fear is overblown," Sebastiano wrote in a note to investors about possible slot cutbacks. "(Casino) operators that we have spoken to over the past two weeks or so have said they plan to cut development (spending) but not maintenance spending, which includes spending on slot machines."The bulk of AC Coin's business used to be in Atlantic City, but the company has branched out across the country in recent years. California's Indian-owned casinos are the company's primary market now. Soon, AC Coin will be expanding its presence at the slot parlors in Pennsylvania, one of the few gaming jurisdictions enjoying revenue growth this year.After riding the ups and downs of the casino industry for 30 years, AC Coin is ready to capitalize on any opportunities that may come its way, company executives say."For us, growth will come in just about every market," said Jerry Seelig, the company's executive vice president of operations and general manager.E-mail Donald Wittkowski:DWittkowski@pressofac.com
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