Gamehost Income Fund - Reports 2009 third quarter financial results
RED DEER, AB,
At first it was just our feet. Now the water is up to our knees. Results for the Quarter indicate general economic conditions for the consumer worsened from last quarter. Quarterly revenues for continuing operations totaled
Continuing operations earnings before interest, taxes, depreciation and amortization ("EBITDA") for the Quarter totaled
Operating results at Fund properties from Fort McMurray to
While overall activity has retreated at Boomtown Casino there are clues to suggest it won't last. The latest Statistics
Year over year the number of active drilling rigs operating in Alberta is down more than 50%. The Grande Prairie region is highly dependant on the oil and more prominently the natural gas industries. It's not surprising that our properties in Grande Prairie are feeling the pinch. The rate of descent, however, has definitely slowed in the last few months and we look forward to a leveling out before beginning another ascent. We commend our property managers who have done an excellent job at maintaining operating margins though strict cost control.
The Deerfoot Joint Venture facility is still immensely popular with the surrounding communities which continue to grow at the fastest pace in the city. Our customers remain loyal, however, business and corporate travel is down which has affected guest room sales at the property. The Deerfoot Joint Venture hotel marketed as a mid tier property and ADR's have been held at appropriate levels. Gaming and food & beverage sales have held up relatively well at the property.
Despite an intense and concerted effort, during its brief fourteen months of operation the Fund's 20% participating interest in the Stampede Joint Venture resulted in accumulated operating losses of
Fat, excess, saddlebags... call it what you like, we're not carrying quite as much of it around as we used to. Throughout the Quarter, the Fund maintained regular cash distributions of $0.0733 per unit. This coupled with reduced cash inflow has reduced our normally significant interim cash surplus. During the Quarter the Fund paid out a guarantee provided to the Stampede Joint Venture's lender.
The Fund is busy working on strategies in preparation for the change in the tax status of all trusts in post 2011. We are focused on maximizing the profitability of our core operations while keeping an eye on potential strategic opportunities.
Interim Consolidated Balance Sheets (unaudited) ------------------------------------------------------------------------- Audited September 30, December 31, 2009 2008 ------------------------------------------------------------------------- Assets Current assets: Cash and cash equivalents $ 10,481,874 $ 12,045,414 Restricted cash 35,130 58,962 Accounts receivable 671,279 1,215,303 Inventories 286,524 304,239 Prepaid expenses 348,783 261,109 Due from related parties - 30,575 Current assets of discontinued operations - 1,044,104 ------------------------------------------------------------------------- 11,823,590 14,959,706 Property, plant and equipment 31,386,872 33,201,893 Goodwill 42,579,216 42,579,216 Long term assets of discontinued operations - 11,473,837 ------------------------------------------------------------------------- $ 85,789,678 $102,214,652 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Liabilities and unit holder equity Current liabilities: Accounts payable and accrued liabilities $ 2,588,975 $ 2,210,970 Revolving credit lines 6,000,000 4,000,000 Demand loans 17,744,461 15,332,924 Unit holder distributions payable 1,547,184 5,080,588 Current liabilities of discontinued operations - 8,762,218 ------------------------------------------------------------------------- 27,880,620 35,386,700 Future income taxes 1,483,984 1,800,682 Long term liabilities discontinued operations - 52,922 ------------------------------------------------------------------------- 29,364,604 37,240,304 Minority unit holders' equity 25,981,280 32,955,463 ------------------------------------------------------------------------- 55,345,884 70,195,767 Fund unit holders' equity 30,443,794 32,018,885 ------------------------------------------------------------------------- $ 85,789,678 $102,214,652 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Interim Consolidated Statements of Income and Comprehensive Income (unaudited) ------------------------------------------------------------------------- nine months ended three months ended September 30 September 30 --------------------------------------------------- 2009 2008 2009 2008 ------------------------------------------------------------------------- Revenue Hotel - rooming $ 5,010,512 $ 6,324,696 $ 1,531,466 $ 2,264,988 Table games 6,186,201 5,595,285 1,862,998 1,884,796 Slot machines 14,262,842 15,945,997 4,604,795 5,283,898 Food and beverage services 7,692,932 8,382,568 2,339,228 2,637,235 Lease and rental 271,354 243,297 96,260 79,592 Other 2,869,993 3,530,822 880,887 1,158,163 ------------------------------------------------------------------------- 36,293,834 40,022,665 11,315,634 13,308,672 ------------------------------------------------------------------------- Operating Expenses Cost of goods sold 2,398,898 2,669,401 734,982 852,688 Human resources 9,636,397 10,187,573 3,152,096 3,372,411 Marketing and promotions 1,542,762 1,765,491 541,600 594,552 Operating 4,372,730 4,748,599 1,416,624 1,687,381 Corporate and general administration 1,649,763 1,479,586 547,281 429,886 Amortization of property, plant and equipment 1,422,331 1,520,506 475,866 518,251 ------------------------------------------------------------------------- 21,022,881 22,371,156 6,868,449 7,455,169 ------------------------------------------------------------------------- Operating income 15,270,953 17,651,509 4,447,185 5,853,503 Other income and (expenses) Interest charges (584,698) (967,277) (204,278) (305,756) ------------------------------------------------------------------------- (584,698) (967,277) (204,278) (305,756) ------------------------------------------------------------------------- Income before taxes and minority interest 14,686,255 16,684,232 4,242,907 5,547,747 Future income tax recovery (expense) 316,698 54,135 (1,459,195) (43,089) ------------------------------------------------------------------------- 15,002,953 16,738,367 2,783,712 5,504,658 Minority interest (6,634,761) (8,195,217) (652,138) (2,695,118) ------------------------------------------------------------------------- Net and comprehensive income (loss) Continuing operations $ 8,368,192 $ 8,543,149 $ 2,131,574 $ 2,809,539 Discontinued operations (5,369,968) (252,693) (2,220,400) (162,588) ------------------------------------------------------------------------- $ 2,998,224 $ 8,290,456 $ (88,826) $ 2,646,951 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Net Income/unit and comprehensive income/unit Continuing operations $ 0.711 $ 0.793 $ 0.181 $ 0.261 Discontinued operations (0.456) (0.023) (0.189) (0.015) ------------------------------------------------------------------------- $ 0.255 $ 0.770 $ (0.008) $ 0.246 ------------------------------------------------------------------------- -------------------------------------------------------------------------
This press release may contain forward-looking statements. Forward-looking statements may contain words such as "anticipates", "believes", "could", "expects", "indicates", "plans" or other similar expressions that suggest future outcomes or events. Use of these statements reflect reasonable assumptions made on the basis of management's current beliefs with information known by management at the time of writing. Many factors could cause actual results to differ from the results discussed in forward-looking statements. Actual results may not be consistent with these forward-looking statements.
The Fund is an unincorporated open-ended limited purpose trust established under the laws of the Province of Alberta. The Fund's activities are currently confined to the Province of Alberta,
Complete consolidated interim financial statements and MD&A for the nine and three months ended
%SEDAR: 00019487E
For further information: Craig M. Thomas or, Darcy J. Will, P (403) 346-4545, F (403) 340-0683, E [email protected]
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