The Company also announced it expects to file its Annual Report on Form 10-K for the fiscal year ended June 30, 2007 ("2007 Form 10-K") and its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 (collectively, the "Filings") with the Securities and Exchange Commission on Friday, Nov. 2, 2007.

    Fiscal 2007 Fourth Quarter Highlights
    -- Total revenue increased to $202.4 million as compared with $154.9
       million for the same period of the prior year, an increase of 31
       percent.
    -- Earnings were $18.5 million as compared with a loss of $12.0 million in
       the fourth quarter of last year.
    -- Earnings per fully diluted share were $0.33 as compared with a fully
       diluted loss per share of $0.23 in the prior year.
    -- Earnings per fully diluted share adjusted for share-based compensation
       ("Adjusted EPS") were $0.37 compared with a $0.19 loss per share in the
       prior year.
    -- Gaming Equipment revenues increased to $104.7 million from $71.5
       million in the prior year, an increase of 46 percent.
    -- The margin for gaming equipment sold increased to 41 percent for the
       fourth quarter from 35 percent in the third quarter of fiscal 2007.
    -- The Company sold 7,241 new units as compared with 5,523 in the prior
       year, an increase of 31 percent.
    -- Gaming Operations revenue increased to $50.6 million from $44.7 million
       in the third quarter of fiscal 2007, a sequential increase of 13
       percent.
    -- Gaming Operations revenue increased by 40 percent from $36.1 million in
       the prior year.
    -- Revenues from the Company's casino operations in Vicksburg, Miss., were
       $11.6 million as compared with $11.1 million in the prior period, an
       increase of 5 percent.

    Fiscal 2007 Highlights
    -- Total revenue increased to $682.3 million for the year as compared with
       $541.6 million in the prior year, an increase of 26 percent.
    -- Net income increased to $22.3 million in the current year from a net
       loss of $46.1 million in the prior year.
    -- Earnings per fully diluted share were $0.40 compared to a fully diluted
       loss per share of $0.88 in the prior year.
    -- Earnings per fully diluted share adjusted for share-based compensation
       were $0.58 compared to a $0.72 loss per share in the prior year.
    -- Gaming Equipment revenues increased to $324.1 million from $225.1 in
       the prior year, an increase of 44 percent.
    -- The Average Selling Price ("ASP") of new units increased 24 percent to
       $12,617 in fiscal 2007 from $10,182 in the prior year.
    -- The Company sold 21,372 new units as compared with 17,887 in the prior
       year, an increase of 19 percent.
    -- The margin for gaming equipment sold increased to 36 percent for fiscal
       2007 as compared with 19 percent in the prior year.
    -- Gaming Operations revenue increased to $176.4 million in fiscal 2007
       from $147.0 million in the prior year, or 20 percent.
    -- Systems revenue increased to $134.1 million from $120.5 million in the
       prior year, an increase of 11 percent.
    -- Revenues from the Company's casino operations in Vicksburg, Miss., were
       $47.7 million as compared with $49.0 million in the prior year, a
       decrease of 3 percent.
    -- Adjusted EBITDA was $138 million, as compared with $50 million in the
       prior year.
    -- Cash and cash equivalents increased to $40.8 million from $16.4 million
       in the prior year.

Financial Review

Unaudited summary financial information for the Bally Gaming and Systems segment for the three months ended March 31, 2007 and 2006 and the three months ended June 30, 2007 and 2006 are presented below:

                Three Months Ended March 31,   Three Months Ended June 30,
                           %             %               %              %
                   2007   Rev    2006   Rev     2007    Rev   2006     Rev
                                        (in 000s)

    Revenues
    Gaming
     Equipment    $86.7   53%   $63.5   45%    $104.7   55%   $71.5    50%
    Gaming
     Operations    44.7   28%    38.6   27%      50.6   26%    36.1    25%
    Systems        30.8   19%    38.7   28%      35.4   19%    36.2    25%
    Total
     revenues    $162.2  100%  $140.8  100%    $190.7  100%  $143.8   100%

    Gross
     Margin
    Gaming
     Equipment    $30.6   35%   $11.3   18%     $42.9   41%    $9.5    13%
    Gaming
     Operations    26.1   58%    13.5   35%      32.1   63%    19.9    55%
    Systems        23.4   76%    25.7   66%      27.1   77%    25.2    70%
    Total gross
     margin       $80.1   49%   $50.5   36%    $102.1   54%   $54.6    38%

    Selling,
     general and
     adminis-
     trative      $41.8   26%   $37.7   27%     $45.1   24%   $42.6    30%
    Impairment
     charges         --   --%    14.0   10%        --   --%     1.6     1%
    Research
     and
     development
     costs         12.5    8%    12.2    9%      13.5    7%    11.9     8%
    Depreciation
     and
     amortization   5.2    3%     4.9    3%       4.3    2%     4.7     3%
    Operating
     income (loss)$20.6   13%  $(18.3)(13)%     $39.2   21%   $(6.2)   (4)%

                      Three Months Ended March 31, Three Months Ended June 30,
                             2007          2006        2007         2006

    Operating Statistics
    New gaming devices sold  6,032        5,901        7,241        5,523
    OEM units sold               -          324            -          121
    New unit average
     selling price         $12,984       $9,082      $12,596      $10,633

    End of period
     installed base:
    Wide-area and
     local-area
     progressives            1,389        1,837        1,343       1,622
    Rental and daily-fee
     games                   5,331        2,865        6,196       3,422
    Lottery systems          7,736        8,023        7,791       4,300
    Centrally determined
     systems                33,275       25,627       35,729      27,437

Gaming Equipment. Gaming Equipment revenue increased to $86.7 million in the third quarter of fiscal 2007, a 37 percent increase from the same period of the prior year. Revenues for the fourth quarter increased to $104.7 million, a 46 percent increase over the prior year primarily as a result of:

    -- An increase in new gaming device unit sales to 6,032 and 7,241 in the
       three months ended March 31, 2007 and June 30, 2007, respectively, as
       compared with 5,901 and 5,523 units, respectively, in the comparable
       periods of the prior year; and,

    -- An increase in the ASP of new gaming units, excluding OEM sales, as a
       result of:
       -- Low introductory pricing in the prior year related to the roll-out
          of devices based on the ALPHA OS platform;
       -- Increased pricing on a number of products during the second quarter
          of fiscal 2007; and
       -- Reduced discounts offered to our customers due to increased
          acceptance of our products.

Gaming Equipment Gross Margin: Gaming Equipment gross margin increased to 35 percent and 41 percent, respectively, for the three month periods ended March 31 and June 30, 2007 from 18 percent and 13 percent, respectively, in the comparable periods of the prior year, primarily as a result of:

    -- A 43 percent and 18 percent increase in the ASP per unit for the three
       month periods ended March 31 and June 30, 2007, respectively;

    -- Lower inventory charges in the current quarterly periods when compared
       to the prior year.  Inventory charges were higher in fiscal 2006 as a
       result of the decision to move to a single platform and the related
       disposal of legacy products and inventory; and,

    -- Manufacturing efficiencies due to increased volumes and lower
       manufacturing costs.

Gaming Operations. Gaming Operations revenue increased $6.1 million, or 16 percent, for the three months ended March 31, 2007 and $14.5 million, or 40

percent, for the three months ended June 30, 2007 as compared with the prior year, primarily as a result of:

    -- An increase of $12.7 million, or 66 percent, and $16.2 million, or 81
       percent, for the March 31 and June 30 quarters, respectively, in
       participation and rental revenue derived from:

       -- Our installed base of centrally determined games increased to 33,275
          units as of March 31, 2007 and 35,729 units as of June 30, 2007
          primarily due to games added in Washington,  Florida,  Mexico, Texas
          and Wisconsin; and,
       -- Our installed base of rental and daily fee games increased to 5,331
          units as of March 31, 2007 and 6,196 units as of June 30, 2007. The
          net change was primarily due to the popularity of our Hot Shot
          Progressive product line with an installed base of 1,844 units at
          March 31, 2007 and 2,305 units at June 30, 2007; and

    -- A decrease of $4.0 million, or 35 percent, in content license revenue
       in the three months ended March 31, 2007 when compared to the same
       period last year due to a decrease in lottery license revenue due to
       the removal of lottery systems in Iowa in May 2006 after a change in
       the state's law; and,

    -- A decrease in linked progressive revenue of $2.6 million and $1.6
       million for the quarterly periods ended March 31 and June 30, 2007,
       respectively, due to a decrease in the installed base of games at June
       30, 2007 as compared with June 30, 2006.

Gaming Operations Gross Margin: Gross margin increased to 58 percent and 63 percent in the three months ended March 31, 2007 and June 30, 2007, respectively, from 35 percent and 55 percent, in the comparable periods last year, primarily as a result of:

    -- A decrease in depreciation expense of $5.4 million in the three month
       period ended March 31, 2007 and an increase in depreciation expense of
       $0.2 million in the three month period ended June 30, 2007 when
       compared with the same periods of last year.  A change in fiscal 2006
       in the estimated useful life and salvage values for certain gaming
       equipment used in the Gaming Operations division resulted in an
       increase in depreciation expense charged to cost of gaming operations
       in the three months ended March 31, 2006; and,

    -- A decrease of $2.1 million and $0.5 million in the three month periods
       ended March 31 and June 30, 2007, respectively, in expenses related to
       funding the progressive jackpot liability due to the decrease in the
       installed base of games and related revenue during the year.

Systems: Systems revenue decreased $7.9 million, or 20 percent, in the quarter ended March 31, and $0.8 million, or 2 percent, in the quarter ended June 30, 2007. During the six months ended June 30, 2007, the Systems division deferred a significant amount of revenue because it did not meet the criteria for revenue recognition. Deferred revenue at June 30, 2007, which is primarily related to Systems, increased to $131.0 million from $87.3 million at Dec. 31, 2006.

Systems Gross Margin: Systems gross margin increased to 76 percent and 77 percent in the three month periods ended March 31 and June 30, 2007, respectively, from 66 percent and 70 percent, respectively, in the same periods last year, primarily as a result of lower customer discounts.

Unaudited summary financial information for the Bally Gaming and Systems segment for the fiscal years ended June 30, 2007 and 2006 are presented below:

                                         Year Ended June 30,
                             2007          %Rev        2006         %Rev
                                       (dollars in millions)
    Revenues
    Gaming Equipment        $324.1          51%       $225.1          46%
    Gaming Operations        176.4          28%        147.0          30%
    Systems                  134.1          21%        120.5          24%
    Total revenues           634.6         100%        492.6         100%
    Gross Margin
    Gaming Equipment         117.8          36%         42.1          19%
    Gaming Operations        104.6          59%         65.6          45%
    Systems                   96.4          72%         87.9          73%
    Total gross margin       318.8          50%        195.6          40%
    Selling, general
     and administrative      169.0          27%        146.1          30%
    Restructuring charges        -           -%            -           -%
    Impairment charges           -           -%         15.6           3%
    Research and development
     costs                    51.9           8%         45.1           9%
    Depreciation and
     amortization             18.1           3%         19.4           4%
    Operating income (loss)  $79.8          13%       $(30.6)         (6)%

                                        Year Ended June 30,
                                          2007      2006

    Operating Statistics:
    New gaming devices sold              21,372    17,887
    OEM units sold                        1,605       771
    New unit average selling price      $12,617   $10,182

    End of period installed base:
      Wide-area and local-area
       progressives                       1,343     1,622
      Rental and daily-fee games          6,196     3,422
      Lottery systems                     7,791     4,300
      Centrally determined systems       35,729    27,437

Total revenues for the Bally Gaming Equipment and Systems segment increased $142.0 million, or 29 percent, in fiscal 2007, when compared with fiscal 2006, as a result of the following:

Gaming Equipment. Gaming Equipment revenue increased by $99.0 million, or 44 percent, primarily as a result of:

    -- An increase in new gaming device sales to 21,372 units in fiscal 2007
       as compared with 17,887 units in fiscal 2006; and,

    -- An increase in the ASP per unit, excluding OEM sales, to $12,617 in
       fiscal 2007 as compared to $10,182 in fiscal 2006.  This was primarily
       the result of:

       -- Low introductory pricing in the prior year related to the roll-out
          of devices based on the then new Alpha OS platform; and,
       -- Increased pricing on a number of products during the second quarter
          of fiscal 2007 and reduced discounts offered to our customers due to
          increased acceptance of our products during the year.

Gaming Equipment Gross Margin: Gaming Equipment gross margin increased to 36 percent in fiscal 2007 from 19 percent, in the same period last year, primarily as a result of:

    -- A 24 percent increase in the ASP per unit, excluding OEM sales;

    -- A $4.0 million decrease in inventory write-downs in fiscal 2007 when
       compared with fiscal 2006.  Inventory charges were higher in fiscal
       2006 as a result of the decision to move to a single platform and the
       related disposal of legacy products and inventory;

    -- An $11.4 million increase in parts and conversion kits revenue at
       higher margins in fiscal 2007 when compared with fiscal 2006; and

    -- Manufacturing efficiencies due to increased volumes and lower
       manufacturing costs.

Gaming Operations. Gaming Operations revenue increased $29.4 million, or 20 percent, primarily as a result of:

    -- An increase of $45.2 million, or 61 percent, in participation and
       rental revenue primarily as a result of:

       -- Our installed base of centrally determined games increased 30
          percent from 27,437 units as of June 30, 2006 to 35,729 units as of
          June 30, 2007 primarily due to games added in Washington, Florida,
          Oklahoma, Texas and Wisconsin;
       -- Our installed base of rental and daily fee games increased 81
          percent from 3,422 units as of June 30, 2006 to 6,196 units as of
          June 30, 2007 primarily due to the popularity of our Hot Shot
          product line with a net increase of 1,810 units installed during the
          fiscal year; and,
       -- Our installed base of lottery units increased 81 percent from 4,300
          units as of June 30, 2006 to 7,791 units as of June 30, 2007
          primarily due to additions of units at raceways connected to the New
          York Lottery.

    -- A decrease of $5.3 million, or 15 percent, in content licenses in
       fiscal 2007 when compared to fiscal 2006 primarily due to a decrease in
       daily fees generated from domestic lottery customers due to the removal
       of lottery systems in Iowa in May 2006 after a change in the state's
       law; and

    -- A decrease in linked progressive revenue of $10.4 million, or 30
       percent, due to a decrease in the installed base of games during the
       year.

Gaming Operations Gross Margin: Gross margin increased to 59 percent in fiscal 2007 from 45 percent in fiscal 2006 primarily as a result of:

    -- A decrease in depreciation expense of $5.5 million in fiscal 2007 when
       compared with fiscal 2006.  A change in fiscal 2006 in the estimated
       useful life and salvage values for certain gaming equipment used in the