REFILE-UPDATE 2-Bally Technologies Q4 profit beats Street

(Refiles to add Bangalore dateline)

* Q4 EPS $0.58 vs est $0.55 * Q4 rev $205 mln vs est of $221.6 mln

* Initiates 2010 EPS view $2.25-$2.50

* Shares down 2 pct in after-mkt trade (Adds analyst comments, updates share movement)

By Nivedita Bhattacharjee

BANGALORE, Aug 12 (Reuters) - Gaming technology supplier Bally Technologies Inc (BYI.N) posted a bigger-than-expected quarterly profit as gross margins improved and expenses fell.

"Improved gross margins and control of expenses allowed us to drive our fourth quarter operating margin to 25 percent during the quarter from 23 percent in the same period last year," the company said in a statement.

The company, which makes casino management systems and gaming devices such as slot machines, expects to earn $2.25 a share to $2.50 a share in 2010.

Analysts on average were expecting a full-year profit of $2.37 a share, excluding special items, according to Reuters Estimates.

"The guidance is relatively conservative, and I think the market may not be reading into that conservatism," David Bain, analyst with Sterne Agee & Leach said, adding that the management is likely looking to surpass expectations rather than just meeting them.

Bally's outlook does not include some international jurisdictions that the company is entering, as well as expansion in the gaming segment, the analyst said.

The company said new products and an expected improvement in customer spending beginning in calendar 2010 would offset the sluggish North American gaming machine replacement market and an overall weakness in the economy.

For the fourth quarter ended June 30, Bally Tech earned $33.2 million, or 58 cents a share, compared with $31.3 million, or 54 cents a share, in the year-ago quarter.

Revenue fell to $205.1 million from $247.4 million last year, with gaming equipment and systems revenue -- a key segment at the company -- falling 17 percent during the quarter.

Analysts were expecting earnings of 55 cents a share, before special items, on revenue of $221.6 million.

Shares of the Las Vegas-based company were down 2 percent at $36.90 in trading after the bell. They closed at $37.61 Wednesday on the New York Stock Exchange. (Reporting by Nivedita Bhattacharjee in Bangalore; Editing by Pradeep Kurup)