Poydras Gaming Finance Corp. Announces 2017 Second Quarter Results

—Double digit growth in revenue and Adjusted EBITDA driven by increased installations with both new and existing customers—

VANCOUVER, Aug. 23, 2017 /CNW/ - POYDRAS GAMING FINANCE CORP.  (TSX‐V: PYD; OTCQX: PYDGF) ("Poydras," "PGFC," or the "Company") today announces financial results for the second quarter ended June 30, 2017 (all amounts stated in U.S. dollars unless otherwise indicated).

Second Quarter 2017 Highlights and Financial Results

  • 25% increase in revenue to $4,250,547, compared to $3,390,891 in Q2 2016.
  • 33% increase in leasing revenue to $3,614,580, compared to $2,721,457 in Q2 2016.
  • 18% increase in Adjusted EBITDA to $2,339,286, compared to $1,988,157 in Q2 2016.  
  • Net loss of $1,382,586 compared with a net loss of $946,103 in Q2 2016. 
  • An average of 2,583 gaming machines in operation in Q2 2017, compared to an average of 2,435 in Q2 2016.

"Our growth in revenue and adjusted EBITDA in the second quarter of 2017 reflects our continued success at executing our growth strategy," said Peter Macy, CEO of Poydras. "This strategy includes both increasing machines in place with our existing customers and placing machines with new customers. In addition we are seeing favorable results from our active program of upgrades and conversions."

Highlights Subsequent to Quarter End

  • Deployed its first Gamblit Gaming machines in Quapaw, Oklahoma at the Downstream Casino Resort. The Company expects further installations of these next generation gaming devices with multiple contracts in place.
  • Deployed its first Grand Vision Gaming machines at the Choctaw Casino's & Resorts in Durant, Oklahoma.  The Company will also be placing Gamblit consoles at this casino.
  • Signed a new agreement with a new customer for the addition of 100 gaming machines.  The Company will begin placing these new machines towards the end of August with a target completion of September, 2017.

"Our leading market presence in the Oklahoma and Texas markets and our offering of innovative gaming machines will continue to drive installations," added Mr. Macy. "We expect that by the end of the third quarter we will be operating in over 30 casinos."

Appointment of the Chairman of the Board of Directors
The Company also announces that David Danziger has been appointed Chairman of the Board.  The appointment is effective August 22, 2017.  David is the Senior Vice President of Assurance at MNP LLP, one of the largest full-service CPA and business advisory firms in Canada, as well as the National Leader of MNP's Public Companies practice, and originally joined the Poydras Board as an independent director on June 18, 2015. He is also a Director of Jackpot Joy plc, the world's largest online bingo-led operator.  Peter Macy, current CEO and former Chairman, will remain on the Board as a Director. 

"David has played an active and invaluable role on our Board since joining us in 2015 sharing his wealth of experience in the global capital markets and gaming sectors," said Peter Macy, CEO of Poydras Gaming. "Our Company has reached a stage in its growth where as a Board we felt it was appropriate to separate the Chairman and CEO functions and we are delighted that David has agreed to serve as our new Chairman."

"I have enjoyed my tenure as a Board member of Poydras and look forward to helping the Company as it enters a new phase in its growth," said David Danziger, Chairman of Poydras Gaming.    

Quarterly Adjusted EBITDA

Adjusted EBITDA and reconciliation to net income (loss) is as follows:


Q2 2017

Q1 2017

Q4 2016

Q3 2016

Q2 2016


($)

($)

($)

($)

($)







Net Income (loss)

(1,382,586)

(1,167,084)

(2,935,028)

(2,918,891)

(946,103)







Adjustments:







Depreciation of equipment

1,525,644

1,390,548

1,074,475

1,024,513

954,638


Amortization of placement fees

449,658

449,658

533,904

524,449

443,148


Amortization of intangible assets

199,576

198,775

218,337

223,772

217,395


Income tax expense (recovery)

-

-

(119,904)

(357,883)

(498,427)


Finance lease receivable reduction

308,392

467,486

513,064

664,490

501,599


Financing costs

1,145,358

1,140,346

1,153,146

2,170,864

898,576


Foreign exchange (gain) loss

(196)

8,466

745

(97,863)

(47,175)


Impairment of placement fees

-

-

1,732,152

-

-


Impairment of loan receivable

-

-

-

(85,000)

28,505


Gain on settlement of debt

224

(28,380)

-

(110,487)

-


Loss (gain) on disposal of assets

(23,200)

(64,500)

12,750

-

65,858


Loss (gain) on disposal of BitBoss

-

(43,712)

-

-

-


Revaluation of earn-out liability

-

-

30,000

450,000

-


Revaluation loss on investment in A&W JV

-

-

-

588,317

-


Stock based compensation

116,416

92,919

102,272

207,210

206,177


A&W JV EBITDA adjustments at 50% interest:







Depreciation of equipment

-

-

-

69,254

172,113


Amortization of placement fees

-

-

-

4,728

10,416


Interest expense

-

-

-

6,076

18,178


Loss (gain) on disposal of assets

-

-

-

-

(36,741)







Adjusted EBITDA

2,339,286

2,444,522

2,315,913

2,363,549

1,988,157

Conference Call

The Company will hold a conference call to discuss the results for its second quarter ended June 30, 2017. The call will be hosted by Peter Macy, CEO, and Adam Kniec, CFO on Thursday, August 24, 2017 at 8:00 a.m. PDT (11:00 a.m. EDT), and followed by a question and answer period.  All interested parties are invited to participate. 

Conference Call Details:


Date:                                     

Thursday, August 24, 2017

Time:                                     

8:00 a.m. Pacific Time / 11:00 a.m. Eastern Time



Dial-In Numbers:                

North America Toll-Free Dial-In Number:

1 (888) 231-8191


For Toronto:   

(647) 427-7450


For Vancouver:   

(778) 371-9827



Conference ID:                    

68413989



Taped Replay:                      

1 (855) 859-2056


Available until 12:00 midnight (EST) Thursday, August 31, 2017


Reference number: 68413989

About Poydras Gaming Finance Corp.:
Poydras Gaming is a regional slot route operator with approximately 2,600 gaming machines in operation across over 25 casinos in Oklahoma and Texas.  The Company primarily derives its revenue from short- and long-term revenue share contracts with Native American casinos.  It provides gaming equipment such as slot machines and electronic table games, and project financing to owners, operators, and managers of casinos and other regulated gaming venues.  The company works with casinos, new casino developments, and gaming machine suppliers.  In addition, it distributes casino and bingo equipment, and offers direct and online sales of gaming supplies for poker and bingo. Additional information about the Company can be found on the Company's website at www.poydrasgaming.com and on the SEDAR website at www.sedar.com.

Neither the 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.

Cautionary Note Regarding Forward‐Looking Statements
Certain information in this news release is considered forward‐looking within the meaning of certain securities laws and is subject to important risks, uncertainties and assumptions. This forward‐looking information includes, among other things, information with respect to the Company's beliefs, plans, expectations, anticipations, estimates and intentions. The words "may", "could", "should", "would", "suspect", "outlook", "believe", "anticipate", "estimate", "expect", "intend", "plan", "target" and similar words and expressions are used to identify forward‐looking information. The forward‐looking information in this news release, including those statements relating to expected EBITDA, and the placement of additional machines by the Company, describes the Company's expectations as of the date of this news release.

The results or events anticipated or predicted in such forward‐looking information may differ materially from actual results or events. Material factors which could cause actual results or events to differ materially from such forward‐ looking information include, among others, risks arising from general economic conditions and adverse industry events.

The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company's forward‐looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward‐looking information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.

THE FORWARD‐LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD‐LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME.

Non‐IFRS Measures – Poydras Gaming Finance Corp.  
Adjusted EBITDA is a financial measure that does not have a standardized meaning under IFRS. Adjusted EBITDA is defined as earnings before financing costs, income taxes, depreciation, amortization, stock based compensation, unrealized foreign exchange, impairment of loans receivable, impairment of placement fees, gain/loss on settlement of debt, gain/loss on disposal of assets, finance lease receivable reduction, revaluation adjustment of earn-out liability, revaluation loss on investment in A&W JV and non-recurring costs.  In addition, to arrive at the Adjusted EBITDA, the Company is adjusting its earnings for its 50% share of the above mentioned income/expense and gain/loss categories that are included in the Company's income from equity accounted investees up to the date of the acquisition of the A&W JV on August 12, 2016.

As there is no standardized method of calculating Adjusted EBITDA, it may not be directly comparable with similarly titled measures used by other companies.  The Company considers Adjusted EBITDA to be a relevant indicator for measuring trends in performance and its ability to generate funds to service its debt and to meet its future working capital and capital expenditure requirements. Adjusted EBITDA is not a generally accepted earnings measure and should not be considered in isolation or as an alternative to net income (loss), cash flows or other measures of performance prepared in accordance with IFRS.

SOURCE Poydras Gaming Finance Corp.

For further information: Craig MacPhail, Investor Relations | NATIONAL Equicom, T: (416) 586-1938, E: cmacphail@national.ca; James Kim, VP of Corporate Development, Poydras Gaming Finance Corp., T: (604) 683-8393, E: jk@poydrasgaming.com

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Poydras Gaming Finance Corp.

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