RICHMOND, BC, June 30, 2012 /CNW/ - Great Canadian Gaming Corporation [TSX:GC] ("the Company") announced that it has settled a long-standing dispute with a former Ontario-based consultant. The dispute with the former consultant arose in 2007 from the Company's termination of a consulting agreement entered into as part of the 2005 acquisition of the Company's Georgian Downs subsidiary.
The total cash payment the Company will make related to this settlement is $11.0 million and it will be expensed in the second quarter results for the three months ended June 30, 2012. The after-tax effect of this settlement will be a reduction to the second quarter's net earnings of approximately $8.3 million.
The settlement of this dispute permits the Company's management to focus on managing the businesses and to cease incurring the ongoing legal fees and other costs associated with this dispute.
ABOUT GREAT CANADIAN GAMING CORPORATION
Great Canadian Gaming Corporation is a multi-jurisdictional gaming, entertainment and hospitality operator with operations in British Columbia, Ontario and Nova Scotia, and Washington State. The Company operates ten casinos, a thoroughbred racetrack that offers slot machines, three standardbred racetracks (two offer slot machines and one offers both slot machines and table games), two community gaming centres, a bingo hall, a resort with two hotels, a conference centre and a marina, two show theatres and various associated food and beverage and entertainment facilities. As of March 31, 2012, the Company had approximately 4,000 employees in Canada and 600 in Washington State. Further information is available on the Company's website, www.gcgaming.com.
ON BEHALF OF
GREAT CANADIAN GAMING CORPORATION
"Original signed by Rod N. Baker"
Rod N. Baker
President and Chief Executive Officer
This news release contains certain "forward-looking information" or statements within the meaning of applicable securities legislation. Forward-looking information is based on the Company's current expectations, estimates, projections and assumptions that were made by the Company in light of its historical trends and other factors. All information or statements, other than statements of historical fact, are forward-looking information including statements that address expectations, estimates or projections about the future, the Company's strategy for growth, expected future expenditures, costs, operating and financial results, expected impact of future commitments, the future ability of the Company to operate the Georgian Downs and Flamboro Downs facilities and their profitability, and the ability of the Company to enter into new agreements for the operation of gaming facilities at Georgian Downs and Flamboro Downs. Such forward-looking information is not a guarantee of future performance and may involve a number of risks and uncertainties. Although forward-looking information is based on information and assumptions that the Company believes are current, reasonable and complete, they are subject to a number of factors that could cause actual results to vary materially from those expressed or implied by such forward-looking information. Such factors may include, but are not limited to: terms of operational service agreements with lottery corporations; changes to gaming laws that may impact our operational service agreements; pending, proposed or unanticipated regulatory or policy changes; unanticipated fines, sanctions and suspensions imposed on the Company by its regulators; impact of global liquidity and credit availability; adverse tourism trends and further decreases in levels of travel, leisure and consumer spending; competition from established competitors and new entrants in the gaming business; dependence on key personnel; the risk that systems, procedures and controls may not be adequate to meet regulatory requirements or to support current and expanding operations; potential undisclosed liabilities and capital expenditures associated with acquisitions; negative connotations linked to the gaming industry; First Nations claims with respect to some Crown land on which we conduct our operations; future or current legal proceedings; construction disruptions; financial covenants associated with credit facilities and long-term debt; credit, liquidity and market risks associated with our financial instruments; interest and exchange rate fluctuations; non-realization of cost reductions and synergies; demand for new products and services; fluctuations in operating results; and economic uncertainty and financial market volatility. These factors and other risks and uncertainties are discussed in the Company's continuous disclosure documents filed with the Canadian securities regulatory authorities from time to time, including in the "Risk Factors" section of the Company's Annual Information Form for fiscal 2011, and as identified in the Company's disclosure record on SEDAR at www.sedar.com. The forward-looking information in documents incorporated by reference speak only as of the date of those documents. Readers are cautioned not to place undue reliance on the forward-looking information, as there can be no assurance that the plans, intentions, or expectations upon which they are based will occur. The Company undertakes no obligation to publicly revise forward-looking information to reflect subsequent events or circumstances except as required by law. The forward-looking information contained herein is made as of the date hereof and is expressly qualified in its entirety by cautionary statements in this news release.
For further information:
For investor enquiries:
Ms. Tanya Ruskowski
Executive Assistant to the President and Chief Executive Officer and the Chief Financial Officer
For media enquiries:
Mr. Howard Blank
Vice-President, Communications, Entertainment & Responsible Gaming