Amaya Gaming Group announces its 2012 first quarter financial results
Revenue increases 461% over Q1 2011
MONTREAL, May 29, 2012 /CNW/ - Amaya Gaming Group Inc. (TSX.V: AYA), an entertainment solutions provider for the regulated gaming industry, today announced its financial results for the first quarter ended March 31, 2012. All amounts are stated in Canadian dollars unless otherwise noted.
|FOR THE THREE-MONTH PERIODS ENDED MARCH 31||
|Net earnings (loss)||(4,558,054)||2,887,313||(1,821,662)|
|Basic earnings (loss) per share||(0.09)||0.06||(0.05)|
OTHER RECENT HIGHLIGHTS
- Amaya deployed over 400 Mosino gaming terminals during the first quarter, bringing the worldwide total to over 3860 units.
- On February 2, the boards of Amaya and CryptoLogic Limited reached agreement on the terms of an offer by Amaya to acquire the entire issued and to be issued ordinary share capital of CryptoLogic. An offer document dated February 17 was posted to shareholders of CryptoLogic.
- On February 16, Amaya announced the launch of the first National Lottery of Moldova, based on the Corporation's Short Message Service ("SMS") technology. The National Lottery is the first to launch among a range of gaming initiatives Amaya is implementing in the country under its exclusive, 20-year contract announced in 2011.
- On March 27, in connection with a previously announced private placement financing, the Corporation filed a short form prospectus for the distribution of 28,750 units consisting of convertible debentures and warrants. The offering raised gross proceeds of $28.75 million, to be used to partially finance the CryptoLogic acquisition.
- On April 3, Amaya announced that it had assumed control of CryptoLogic, following the acceptance of its cash offer by a majority of CryptoLogic shareholders the previous week. In addition, the Corporation requested that CryptoLogic submit applications for the delisting of its shares on the London Stock Exchange, NASDAQ and the Toronto Stock Exchange. As of May 16, the Corporation had control of approximately 88.1% of the shares of CryptoLogic, and had extended the offer until May 30.
- On April 24, the Corporation announced that it had ranked first in the Branham300 Top 20 Movers and Shakers category, having made the largest jump in overall revenue rankings in Canada's Information and Communication Technology (ICT) industry, from 257th the previous year to 150th. Amaya also ranked second in Branham's Top 10 Growth Companies category, on the basis of annual revenue growth of 204%.
"In the first quarter we continued our pattern of strong year-over-year revenue growth, driven primarily by the ongoing deployment of our Mosino gaming terminals," said Mr. David Baazov, President and Chief Executive Officer of Amaya Gaming Group. "The completion of the CryptoLogic acquisition was a major strategic accomplishment. While the transaction suppressed first quarter earnings, it will open up new opportunities for us around the world and position us for accelerated growth beginning in the second quarter."
1 EBITDA as defined by the Corporation means earnings before interest and financing costs (net of interest income), income taxes, depreciation and amortization, stock-based compensation, restructuring and other non-recurring costs, and non-controlling interests. EBITDA is a non-IFRS measure.
Amaya reported revenues of $6.38 million for the first quarter of 2012, an increase of $5.24 million or 461% compared to $1.14 million of revenues in the first quarter of 2011. The revenue growth was primarily attributable to the Corporation's sales of its proprietary Mosino gaming terminals, the inclusion of software licensing revenue from Amaya Alberta (formerly Chartwell Technology Inc.), and the operation of SMS lotteries in Kenya and Uganda. On a regional basis, revenue grew by 153% in Africa, 190% in Europe, and from nil to $3.23 million in the Caribbean.
Gross profit was $6.13 million in the first quarter of 2012, representing 96% of revenues, compared to $1.13 million or 99% of revenues in the first quarter of 2011. The decrease in gross profit percentage was due to product sales mix, and in particular a marginally higher proportion of the Corporation's sales of its proprietary Mosino hospitality entertainment system under financing lease arrangements relative to revenue derived from software licensing.
Selling expenses were $1.81 million in the first quarter of 2012, a decrease of 7% from $1.94 million in the first quarter of 2011. The decrease is a result of reductions in marketing expenditures in connection with the Corporation's lottery solutions in Africa.
General and administrative expenses were $7.70 million in the first quarter of 2012, compared to $1.68 million in Q1 2011. The increase was driven by a growing employee base, fully staffed operations in Kenya, Uganda, Moldova, Armenia, and Dominican Republic, amortization costs, and charges associated with the termination of certain agency and employment agreements.
Amaya incurred $2.27 million of acquisition-related costs in the first quarter of 2012, and had no similar expense a year earlier. These costs included underwriter fees and professional fees associated with the acquisition of Cryptologic.
In Q4 2011 EBITDA was $3.4 million on revenue of $9.5 million. Comparatively the EBITDA in Q1 2012 was $(0.72) million on revenue of $6.4 million. Excluding the impact of acquisition-related costs and costs incurred in connection with the termination of agency and employment agreements, operating expenditures in Q1 2012 grew relative to Q4 2011 by $0.54 million dollars primarily as a result of costs attributable to the launch of the mobile lottery in Moldova and the deployment of the online gaming initiative in Dominican Republic.
2012 FIRST QUARTER FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSIS
The complete financial statements, notes to financial statements and Management's Discussion and Analysis for the three-month period ending March 31, 2012, will be available on the SEDAR website at www.sedar.com.
ABOUT AMAYA GAMING GROUP INC.
Founded in 2004, Amaya Gaming Group Inc. is a technology based gaming provider for the regulated gaming industry. An expansive global organization, present in North America, Latin America, Europe, Africa and Asia, Amaya is an innovator in the gaming world.
Headquartered in Montreal, Canada, Amaya provides a host of services and solutions that range from: online and mobile gaming casino games and platforms, traditional and mobile lotteries, networked electronic gaming systems, hospitality in-room entertainment systems, management systems, content suites, advisory and management services, and integrity monitoring and auditing systems for the regulated gaming markets. For more information please visit www.amayagaming.com or www.amayaonline.com.
DISCLAIMER IN REGARDS TO FORWARD-LOOKING STATEMENTS
Certain statements included herein, including those that express management's expectations or estimates of our future performance constitute "forward-looking statements" within the meaning of applicable securities laws. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward looking statements. Except as required by law, the Corporation does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events.
"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."
For further information:
Mr. David Baazov
President and Chief Executive Officer
Amaya Gaming Group Inc.
North America: 1-866-744-3122
The Equicom Group
416-815-0700 ext. 261