DUBLIN, IRELAND — (Marketwire) — 08/11/11 — CryptoLogic Limited (TSX: CRY)(TSX: CXY)(NASDAQ: CRYP)(LSE: CRP), a developer of branded online betting games and Internet casino software, announces its financial results for the second quarter ended June 30, 2011.
Q2 2011 Highlights:
The Board is encouraged by the performance in the quarter and continues to focus on driving revenues further while managing costs tightly to enhance shareholder value.
Operating and Financial Review
Total revenue after amortization of royalties and games in Q2 2011 increased to $7.0 million (Q1 2011: $6.0 million). Revenue in the quarter benefited from a reduction of $0.8 million in liabilities previously provided against revenue through the resolution of a dispute with a significant supplier of games.
Hosted Casino
Revenue from Hosted Casino increased to $5.7 million in Q2 2011 (Q1 2011: $5.2 million), reflecting a higher contribution from a key licensee and $0.3 million related to the above resolution.
Branded Games
Revenue from this segment rose to $2.1 million in Q2 2011 (Q1 2011: $1.5 million), including $0.5 million related to the above resolution. Six new branded games went live in the quarter taking the total number of games rolled out by licensees and generating revenues to date to 185 from 179 at the end of the first quarter.
Poker and Other
Poker and Other revenue amounted to $0.2 million in Q2 2011 (Q1 2011: $0.4 million).
Expenses
Operating expenses decreased to $4.5 million in Q2 2011 (Q1 2011: $4.7 million).
General and Administrative expenses rose to $1.6 million in Q2 2011 (Q1 2011: $1.4 million).
Income before tax for the quarter amounted to $0.5 million compared with a loss before tax of $0.4 million in the first quarter.
Balance Sheet and Cash Flow
Cash and cash equivalents as at June 30, 2011 amounted to $12.0 million (March 31, 2011: $14.5 million). The decrease in cash during Q2 2011 of $2.5 million is primarily due to a $3.0 million decrease in jackpot provisions, following a significant jackpot win during the quarter, and a decrease in other trade payables and accrued liabilities of $1.8 million, partially offset by cash generated from operations before changes in non-cash operating items of $0.7 million and decreased prepayments of $1.0 million. The Company continues to be debt-free.
Update on Commercial Agreements
Further to the announcement on May 12, 2011, the Company signed a binding agreement in June 2011 with the significant supplier of games, which enables the two parties to continue with their commercial relationship.
Further to the announcement on May 12, 2011, the Company remains in dispute with a brand licensor. In June 2011, the Company filed suit against the brand licensor seeking judgment that any breach was cured and the agreement remains in force. The brand licensor has yet to respond to this suit or file a countersuit.
Strategic Review
On March 25, 2011, the Company announced that it had appointed Deloitte Corporate Finance as financial advisor to assist it with a strategic review of the Company. The strategic review is ongoing and further announcements will be made as and when appropriate.
About CryptoLogic® ()
Focused on integrity and innovation, CryptoLogic Limited is a leading developer and supplier of Internet gaming software. With more than 300 games, CryptoLogic has one of the most comprehensive casino suites on the Internet, with award-winning games featuring some of the world-s most famous action and entertainment characters. The Company-s licensees include many top Internet gaming brands. CryptoLogic-s leadership in regulatory compliance makes it one of the few companies with gaming software certified to strict standards similar to land-based gaming. The CryptoLogic Group licenses gaming software and services to blue-chip customers that offer their games to non-U.S. based players around the world.
CryptoLogic-s common shares trade on the Toronto Stock Exchange (CRY, CXY), the NASDAQ Global Select Market (CRYP) and the Main Market of the London Stock Exchange (CRP).
CRYPTOLOGIC FORWARD LOOKING STATEMENT DISCLAIMER:
This press release contains forward-looking statements within the meaning of applicable securities laws. Statements in this press release, which are not historical are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “believe”, “expect”, “anticipate”, “estimate”, “intend”, “may”, “will”, “would” and similar expressions and the negative of such expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are based on certain factors and assumptions including expected growth, results of operations, performance, business prospects and opportunities, foreign exchange rates and effective income tax rates. While the Company considers these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking statements involve known and unknown risks and uncertainties that may cause actual results, performance or achievements of the Company to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Risks related to forward-looking statements include, without limitation, risks associated with the Company-s financial condition, prospects and opportunities, legal risks associated with Internet gaming and risks of governmental legislation and regulation, risks associated with market acceptance and technological changes, risks associated with dependence on licensees and key licensees, risks relating to international operations and risks associated with competition. Additional risks and uncertainties can be found in the Company-s Form 20-F for the fiscal year ended December 31, 2010 under the heading “Item 3 – Key Information – Risk Factors” and in the Company-s other filings with the US Securities and Exchange Commission and Canadian provincial securities commissions. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are given only as at the date of this release and the Company disclaims any obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as otherwise required by law.
Contacts:
CryptoLogic
David Gavagan
Chairman and Interim CEO
+353 1 234 0400
CryptoLogic
Huw Spiers
CFO
+353 1 234 0400
Corfin Public Relations
Neil Thapar
+44 207 596 2860
Corfin Public Relations
Alexis Gore
+44 207 596 2860
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