Amaya Gaming Group announced on Tuesday that it remains on target to generate full full revenues of between CAD $156m to $167m following a strong first quarter performance which saw revenues soar 496 per cent to $38.1m. The company said that the revenue increase was primarily attributable to software licensing fees from its purchase and convergance CryptoLogic and Ongame, as well as participating agreement revenues from Cadillac Jack. “We’re extremely pleased with the substantial positive cash flow generated from our operations in the first quarter,” said Amaya president and CEO David Baazov.
Details of Financial Performance of Amaya
Amaya reported revenues of $38.05 million for the fourth quarter of 2012, an increase of 496% compared to $6.38 million in the first quarter of 2012. This revenue increase is primarily attributable: to consolidating the software licensing and hosted casino revenue of CryptoLogic Limited (“CryptoLogic”), which was acquired on April 2, 2012; consolidating software licensing revenue from Ongame Network Limited (“Ongame”), which was acquired on November 1, 2012; and consolidating participation agreement revenue of Cadillac Jack Inc. (“Cadillac Jack”), which was acquired on November 5, 2012. On a regional basis, revenue in Q1 2013 was concentrated in North America and Europe.
Gross profit percentage was 99% of revenues for the three months ended March 31, 2013 and 96% for the three month period ended March 31, 2012.
Selling and marketing expenses increased from $1.81 million for the three month period ended March 31, 2012 to $3.73 million for the three month period ended March 31, 2013, representing an increase of 106%, attributable to consolidating advertising, promotion and royalty expenses incurred by CryptoLogic and advertising and promotion expenses incurred by Cadillac Jack.
General and administrative expenses increased from $7.51 million for the three month period ended March 31, 2012, to $34.37 million for the three month period ended March 31, 2013, representing an increase of 358%. The increase in 2013 was driven by a growing employee base and higher rent due to the CryptoLogic, Cadillac Jack, and Ongame acquisitions, and increases in amortization costs, consulting and professional fees, costs incurred in connection with the termination of employment agreements, communications expense in connection with generating CryptoLogic’s hosted casino revenue, maintenance and repairs, and other costs.
Financial expenses were $6.21 million for the three month period ended March 31, 2013 and $0.41 million for the three month period ended March 31, 2012. The increase is primarily attributable to interest on the convertible debentures related to the acquisition of Cryptologic, and the senior secured term loan in connection with the agreement and plan of merger to acquire Cadillac Jack.
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