Contagious Gaming Announces Year End Results for 2015
July 29, 2015 (Source: Marketwired) — NOT FOR DISSEMINATION IN THE US OR THROUGH US NEWSWIRE SERVICES
Contagious Gaming Inc. (TSX VENTURE: CNS) (“Contagious Gaming” or the “Company“) is pleased to announce the financial results for the three months and fiscal year ended March 31, 2015.
“Since going public in September of 2014 we have achieved significant milestones across all of our business verticals, including the launch of Goal Time with our first white label partner (Trinity Mirror) and the deployment of our eInstant portfolio in the US” said Peter Glancy, CEO and Director. “We look forward to advancing our business in the upcoming year as we continue to roll-out Goal Time and the further deployment of our eInstants as more US lotteries continue to digitize their offerings.” He also commented “We continue to progress on the acquisition of long-standing B2B sports betting platform provider, Digitote, which generates approximately $5mm in revenues and $1.4mm in EBITDA.”
Goal Time Update:
- Officially launched in late December of 2014 as a white label platform with the Trinity Mirror Group (“TMG“), one of the UK’s leading media groups. Since the launch, Goal Time has continued to acquire players, and expand brand awareness, which is in line with management’s expectations to-date. The Company expects to build and increase momentum in player registrations with the start of the 2015/2016 English Premiere League season.
- The Company engaged Rodney Marsh as Goal Time’s specialist commentator. Rodney is a former Manchester City and England football player and international media personality. Rodney has built a significant international media career in TV and radio and has helped to drive Goal Time media strategy by providing players with expert pre-match insight to coverage select live in-play Premier league games.
- The first version of the Goal Time app became available in the Apple Store in July of this year. Development is also currently underway for the version two of the Goal Time app which will streamline gameplay and enhance the overall user experience. The Company anticipates completion of version two to coincide with the beginning of the 2015/2016 English Premier League season in mid-August. It will be available in the Apple Store on iOS following approvals, as well as for Android and direct web download.
Digitote Acquisition Update
- The Company continues to progress with the previously announced acquisition of Digitote Limited and Digitote Software GmbH Deutschland (together “Digitote“), a developer and provider of commercial-grade sports betting and horse racing technology, hardware, and support services to operators across Europe.
- The Company has made significant progress on due diligence matters including business, legal and financial aspects and is working with Digitote on completing the definitive acquisition agreement.
Extension of Development Contract with Major Publisher
- In July 2015, the Company signed an extension to one of its third-party development contracts with a major social gaming content publisher. The extension of the contract is for one year for approximately $1 million of services to be provided by the Company.
Fiscal 2015 Year End Operational Highlights:
- The official launch of digital eInstant games in the state of Georgia on February 9, 2015.
- Entered into a license agreement with Manyx Interactive Ltd. (“Manyx“) to provide the Goal Time software platform within select jurisdictions including Nigeria and Ghana.
- Hired technology-focused marketing firm Oomph Agency to assist in maximizing the impact of the Company’s advertising budget across news publications, digital media and social media channels.
- Official launch Goal Time with our first major partner Trinity Mirror Group (“Trinity Mirror“) on December 21, 2014.
- Secured an extension to one of the Company’s major third-party development contracts.
- Entered into an affiliate sales agreement with Pronto Games Ltd. (“Pronto“) to sell, distribute and promote Goal Time to its gaming and sports media network across Northern and Eastern Europe, and Asia.
- Completed go-public transaction and concurrent financing of for an aggregate gross proceeds of $6,120,800.
Fiscal 2015 Financial Results:
- The Company generated $1,164,955 of revenue for the year ended March 31, 2015 compared with $765,220, an increase of 52% over the previous year. Revenue for the three months ended March 31, 2015 was $189,946 compared to $496,677 in the previous year, due to lower revenues from third party development contracts.
- Adjusted EBITDA for the year ended March 31, 2015 amounted to a loss of $1,268,152 compared to a loss of $447,066 for the previous year. The increase in the Adjusted EBITDA loss is primarily due to general and administrative and regulatory compliance costs the Company did not incur until completion of the RTO on September 19, 2014. Adjusted EBITDA for the three months ended March 31, 2015 amounted to a loss of $834,912 compared to a loss of $39,020 in the same period of the previous year, for the same reasons noted above.
- As at March 31, 2015 the company had a cash balance of $2,641,989 compared to $16,806 as at March 31, 2014.
|Three Months Ended||Year Ended|
|March 31||March 31||March 31||March 31|
|Adjusted EBITDA (Loss)||(834,912||)||(39,020||)||(1,268,152||)||(447,066||)|
|Adjusted Earnings (Loss)||(1,133,911||)||44,996||(2,140,402||)||(626,893||)|
|Basic and Diluted Adjusted Earnings|
|(Loss) per Share||(0.02||)||0.00||(0.05||)||(0.04||)|
|Total Equity (Deficit)||11,422,953||(611,942||)|
March 31, 2015 Annual Financial Statements and Management Discussion and Analysis:
The Company’s financial statements, notes to the financial statements and Management Discussion and Analysis (“MD&A”) for the twelve months ended March 31, 2015, are available at www.sedar.com.
The following non-IFRS definitions are used in this news release because management believes that they provide useful information regarding our ongoing operations. Readers are cautioned that the definitions are not recognized measures under IFRS, do not have standardized meanings prescribed by IFRS, and should not be construed to be alternatives to revenues and net loss and comprehensive loss for the period determined in accordance with IFRS or as indicators of performance, liquidity or cash flows. Our method of calculating these measures may differ from the method used by other entities and accordingly our measures may not be comparable to similarly titled measures used by other entities or in other jurisdictions.
- Adjusted EBITDA as defined by the Company means earnings before interest and financing costs (net of interest income), income taxes, amortization, depreciation, RTO public listing, stock based compensation, stock based marketing compensation and transaction costs. Management believes that Adjusted EBITDA is a useful measure because it provides information to management about the operating and financial performance of the Company and its ability to generate operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures.
- Adjusted Earnings (Loss), as defined by the Company, means net income (loss) plus or minus items of note that management may reasonably quantify and that it believes will provide the reader with a better understanding of the Company’s underlying business performance. For the purposes of the Company’s current quarter MD&A, Adjusted Earnings (Loss) is calculated by adjusting net income (loss) for (i) financing costs related to extinguished debt, (ii) stock based compensation, (iii) stock based marketing compensation, (iv) RTO public listing, (v) transaction costs and (vi) acquisition related costs. Management believes that Adjusted Earnings (Loss) is an important indicator of the issuer’s ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures and uses the metric for this purpose. Adjusted Earnings (Loss) is also used by investors and analysts for the purpose of valuing an issuer.
- Adjusted Earnings (Loss) per Share, as defined by the Company, means Adjusted Earnings (Loss) divided by the weighted average number of shares outstanding for the period. Management believes that Adjusted Earnings (Loss) is an important indicator of the issuer’s ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt, and fund future capital expenditures and uses the metric for this purpose. Adjusted Earnings (Loss) per Share is also used by investors and analysts for the purpose of valuing an issuer.
The intent of Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share is to provide additional useful information to investors and analysts and these measures do not have any standardized meaning under IFRS. Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share should therefore not be considered in isolation or used as a substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share differently.
A reconciliation of the adjusted measures noted above is included in the “Discussion of Operations” section of the Company’s MD&A.
About Contagious Gaming
Contagious Gaming Inc. (TSX VENTURE: CNS) is a rapidly emerging developer of unique and engaging software solutions for regulated gaming and lottery operators around the world. The Company is currently focused on deploying its first-to-market lottery-style sports betting platform in the United Kingdom and its proprietary digital instant lottery content in United States and other international jurisdictions. Contagious Gaming’s sports betting platform is the first sports betting system to allow players to chase a dynamic jackpot live during Premier League soccer matches. The Company is a first mover in the roll-out of digital instant lottery content in the United States. For more information on Contagious Gaming please visit www.contagiousgaming.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.
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 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.
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Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>