Amaya Announces its 2014 Second Quarter Financial Results

< Previous ArticleNext Article >

MONTREAL, Aug. 14, 2014  Amaya Gaming Group Inc. (“Amaya” or the “Corporation”) (TSX: AYA), an entertainment solutions provider for the regulated gaming industry, today announced its financial results for the three and six month periods ended June 30, 2014. All amounts are stated in Canadian dollars unless otherwise noted.


FINANCIAL HIGHLIGHTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30

Q2 2014
$

Q2 2013
$

H1 2014
$

H1 2013
$

Revenues

42,451,984

37,254,390

83,654,207

75,307,637

Net Income (loss)

(2,894,980)

(11,441,570)

36,748,631

(18,882,411)

Basic earnings per share

$(0.03)

$(0.13)

$0.39

$(0.22)

Diluted earnings per share

$(0.03)

$(0.13)

$0.37

$(0.22)

Adjusted EBITDA1

14,337,641

14,228,019

29,766,921

27,724,528

Adjusted EBITDA1 margin (as % of revenue)

34%

38%

36%

37%

Adjusted net earnings 2

12,480,045

3,727,377

16,367,084

9,775,192

Basic adjusted net earnings2 per share

$0.13

$0.04

$0.17

$0. 11

Diluted adjusted net earnings2 per share

$0.13

$0.04

$0.17

$0.11

__________________________________________
1 Adjusted 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. Adjusted EBITDA is a non-IFRS measure. Reconciliation to Net Income is included in this release.
2Adjusted Net Earnings (loss) as defined by the Corporation means Net earnings (loss) before interest accretion, amortization of Intangible assets resulting from purchase price allocation following acquisitions, stock-based compensation, foreign exchange, and other non-recurring costs.  Adjusted Net Earnings (loss) is a non-IFRS measure. Reconciliation to Net Income is included in this release.


SECOND QUARTER AND SUBSEQUENT HIGHLIGHTS

  • On June 12, 2014, Amaya announced its acquisition of Oldford Group Limited, parent company of the Rational Group, one of the world’s largest online gaming companies and owner and operator of the PokerStars and Full Tilt brands. The Corporation closed this transaction subsequent to the end of the quarter on August 1, 2014, approximately two months ahead of the anticipated timeline. In addition to operating two of the largest online poker sites where it has dealt more than 100 billion poker hands and held over 800 million online tournaments, the group is the largest producer of live poker events around the world. Oldford Group recorded consolidated revenues of approximately USD$1.133 billion (2012 – USD$976 million) and net income of USD$422 million (2012 – USD$314 million) in the fiscal year ended December 31, 2013. Oldford Group recorded consolidated revenues of approximately USD$487 million (2013 – USD$464 million) and net income of USD$193 million (2013 – USD$167 million) in the five months ended May 31, 2014.
  • On May 2, 2014, Amaya announced that its subsidiary Cadillac Jack had received approval from New Jersey’s Division of Gaming Enforcement to utilize its Genesis DV1 slot machine platform and associated hardware and software, including top performing game titles Fire Wolf, Siberian Siren, and Legend of White Buffalo, in the state. Cadillac Jack has subsequently obtained multiple transactional waivers to begin supplying machines to Atlantic City casinos and completed its first installations in the state during the quarter.
  • In addition to New Jersey, Cadillac Jack obtained approvals to market its gaming machines in both Wisconsin and Louisiana with shipments anticipated to begin in the second half of 2014.
  • On April 16, 2014, Amaya announced that Cadillac Jack had entered into multiple agreements to ship approximately 1,100 gaming machines to existing and new customers in the United States. The shipments were primarily comprised of outright sales of gaming machines, but also included the upgrading of some existing revenue share generating gaming machines. The majority of units shipped were Class II machines, but also included some sales of Class III machines including into Oklahoma and California. All machines were manufactured and shipped by the last week of June.
  • During and subsequent to the quarter, Amaya completed the integration of its Casino Gaming System for websites of several major online casino operators including bwin.party’s websites in Europe, Cherry AB’s websites, Ultimate Gaming in New Jersey, and Rational Group’s Full Tilt Poker. Amaya also launched new online and mobile casino games for its customers and completed the integration of new games from multiple third-party suppliers onto Amaya’s Casino Gaming System including IGT, Bally Technologies and SHFL, and Leander.

“The second quarter was a transformative period for Amaya as we announced and completed well ahead of schedule our acquisition of PokerStars and Full Tilt Poker, which collectively hold a healthy majority of the market share in online poker,” said David Baazov, CEO of Amaya. “Led by its highly experienced management team, Rational Group provides Amaya with a strong platform for growth in revenues and profitability and will be significantly accretive to our earnings.

“The company has a loyal and recurring customer base which has been driven by its dedication to player protection and game integrity as well as innovative tournaments, game formats and software technology.  We are strongly committed to Rational maintaining this focus in order for the game experience to remain as enjoyable and exciting as ever for online poker players,” Mr. Baazov added.

“The worldwide recognition of the PokerStars and Full Tilt brands, bolstered by being the largest producer of live poker tours and events across the globe and producer of televised and online poker programming, also provides Rational with an enormous opportunity to take advantage of adjacency opportunities in online casino and sportsbook, in jurisdictions where they can be offered -while growing in new geographies,” Mr. Baazov continued. “Amaya is committed to supporting these growth initiatives. However, with respect to the new verticals, we are determined that they not provide any disruption to the core poker offering and that the new vertical offerings are as robust and enjoyable as Rational’s online poker. After reviewing progress in its new initiatives following our acquisition on August 1, we expect growth in 2014 in these initiatives, notably in online casino, as the company continues to develop its technology platforms up to its high standards and works with various regulators to certify its solution. The company is continuing to see growth in its core poker business and the outlook for its entry into new verticals and geographies is strong. We look forward to updating this outlook in our third quarter financial results, the first