500.com reduces costs as it enters fifth straight quarter with no core revenues

500wallstInvestor concerns continue to mount regarding New York-listed Chinese sports lottery operator 500.com’s ability to survive its services suspension imposed by the Chinese Ministry of Finance.

Posting its Q1 2016 financial performance, the company would record its fourth consecutive quarter with no core product revenues, declaring operating losses of – $15 million for the period.

500.com governance would present no operational metrics for Q1 2016. Instead, the company detailed cuts in its operating expenses, with 500.com significantly reducing all-round marketing, operational and administrative costs.

Making further operational savings, 500.com would offload its 63% stake in Asian online payments provider sumpay.cn reporting a profit of circa $19 million on its investment. 

Updating the market, 500.com declared that as of 31 March the company had a circa cash equivalent of $159 million.

500.com governance would issue no general update on its ‘temporary’ Chinese sports lottery suspension, which the company has served since March 2015.

However, CEO Zhengming Pan would state that 500.com governance was in constant communication with the China Sports Lottery Administration Center regarding its lottery services status.

“To the best of the Company’s knowledge, the approval by the Ministry of Finance for the Company to provide online lottery sales services on behalf of the China Sports Lottery Administration Center is valid and has not been revoked or amended as of the date of this earnings release” Pan would comment

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