NYX Gaming Group Limited Reports First Quarter Financial Results

May 28, 2015, 07:00 ET from NYX Gaming Group Ltd.

Growth momentum continues with revenue growth up 98% to $9.9 million

LAS VEGAS, NV, May 28, 2015 /PRNewswire/ - NYX Gaming Group Limited (TSXV: NYX) ("NYX Gaming Group" or "Company") today announced its financial and operating results for the first quarter three months ended March 31, 2015. All amounts expressed are in Canadian dollars unless otherwise noted.

First Quarter 2015 Highlights

  • Record revenue of $9.9 million compared to $5.0 million to Q1 2014
  • Gross Profit of $8.8 million, representing a gross margin of 88.2%, compared to 85.1% in Q1 2014            
  • Positive EBITDA contribution from social gaming segment
  • Subsequent events to quarter-end:
    • On April 9, 2015, NYX Gaming Group entered into a share purchase agreement to acquire the entire issued share capital of Amaya (Alberta) Inc. (formerly Chartwell Technology Inc.) and Cryptologic Limited for $150 million. This acquisition is expected to increase the Company's content by approximately 300 games to 650.
    • On May 20, 2015, the Company announced the acquisition of the entire issued share capital of Game360 Limited expanding its international presence to Italy. Total consideration consisted of an up-front payment that was less than 5% of our reported total assets as of December 31, 2014 and an earn-out payment based on Game360's EBITDA during the calendar year 2015.

"I am very pleased to report that in our first full quarter of 2015, we have been able to carry forward our growth momentum from last year resulting in a strong start to 2015," said Matt Davey, Chief Executive Officer. "With our proven abilities to identify accretive opportunities, I am confident that our track record of operational and financial success will continue. With our experienced management team, dedicated employees and supportive shareholders we are able to position ourselves for future growth."

Summary of Results

000's, except per share data

3 months ended March 31, 2015

3 months ended March 31, 2014

% Change

Revenue

$9,939

$5,021

98%

Gross Profit

$8,767

$4,274

105%

Gross Margin (%)

88.2%

85.1%

4%

Adjusted EBITDA1

($453)

$355

--

Net Income (Loss)

($5,034)

($1,098)

--

Earnings (loss) per share (basic)

($0.15)

($0.04)

--

Earnings (loss) per share (diluted)

($0.15)

($0.04)

--

1 3 months Adjusted EBITDA excludes share-based compensation, derivative value adjustment, gains and losses, net interest, foreign currency and acquisition and restructuring cost $0.3 million.

 

Q1 2015 Operating and Financial Results

Revenue.  Revenue is derived from income due to royalty/license fees, professional services and social gaming.  Revenue has grown 98% to $9.9 million for the three months ended March 31, 2015 from $5.0 million for the three months ended March 31, 2014.  Royalty and License revenue was the main driver of growth in our business as revenues increased $4.0 for the three months ended March 31, 2015 to $8.0 million from $4.0 million for March 31, 2014.  The growth was attributable to the addition of new customers, growth from existing customers, and three months of revenue from the acquisition of Ongame.  Excluding Ongame revenues increased approximately 79%.  Our social product revenue increased by 126.7% to $1.6 million from $0.9 million for the three months ended.

Gross Profit. Gross profit, which is revenue less cost of sales, increased to $4.5 million for three months ended March 31, 2015 to $8.8 million compared to $4.3 million for the three months ended March 31, 2014.  Gross profit percentage increased by 3% for the three months ended March 31, 2015 to 88% from 85.1%.  The increase was primarily the result of improved economies relative to cost of sales and the mix between gross gaming revenue and/or net gaming revenue between NYX owned content versus third-party licensed content, which we generate higher margins. 

Net Loss. Net loss, which is revenue less all expenses, (including non-cash fair value adjustments to derivatives, and acquisition expenses), for the three month period ended March 31, 2015 was $5.0 million compared to a net loss of $1.1 million for the three months ended March 31, 2014.  The net loss was mainly driven by the losses from Ongame and the fair value adjustment to the embedded derivative related to the Amaya note.

Adjusted EBITDA.  Adjusted EBITDA was $(0.45) million compared to $0.35 million for three months ended March 31, 2015 and March 31, 2014, respectively. During the three months ended March 31, 2015. EBITDA was negatively impacted by 2.8 million of losses related to Ongame. During the three months ended March 31, 2015 the Company's social casino business experienced positive EBITDA for the first time during a calendar quarter, due to the revenue contribution from the acquisition of two social games, supported by additional cost reduction initiatives therein by the Company.

Financial Position as of March 31, 2015

  • Cash and cash equivalents of $21.8 million
  • Total assets of $62.8 million
  • Total liabilities of $30.0 million
  • Total borrowings of $9.1 million net of the discount on the convertible debt
  • Total stockholders' equity of $32.9 million

Financial Statements and Management's Discussion and Analysis

NYX Gaming Group's audited consolidated financial statements, notes thereto and Management's Discussion and Analysis for the three month period ended March 31, 2015 will be available on SEDAR at www.sedar.com. Additional information relating to NYX Gaming Group and its business may also be found on SEDAR at www.sedar.com and the Company's website www.nyxgaminggroup.com.

First Quarter 2015 Conference Call Details

NYX Gaming Group Limited will host a conference call on Thursday, May 28, 2015 at 8:30 a.m. ET to discuss its financial results for the first quarter of fiscal 2015. To access the conference call by telephone, please dial 647-427-7450 or 1-888-231-8191. We recommend callers to dial-in 15 minutes prior to the beginning of the call to ensure participation. A taped rebroadcast will be available to listeners until 23:59 ET on Thursday, June 4, 2015. To access the rebroadcast, please dial 416-849-0833 or 1-855-859-2056 and enter passcode 3535072, followed by the number sign.  

About NYX Gaming Group Limited

NYX Gaming Group is headquartered in Las Vegas with development out of Stockholm and Sydney. The group provides market leading content and technology to some of the largest lotteries, casinos and gaming operators across the globe. Through its recent acquisition of Ongame Network Ltd., a real money poker provider since 2001, NYX Gaming Group now offers a B2B poker network in both Europe and the United States. NYX Poker compliments our suite of casino, bingo and lottery games that players can enjoy on desktop, web and mobile. NYX Gaming Group Limited is listed on the Toronto TSX Venture Exchange (TSX-V:NYX).

Caution Regarding Forward-Looking Statements and Non-IFRS Financial Measures

Certain statements included herein, including those that express management's expectations or estimates of our future performance, constitute "forward-looking statements" within the meaning of applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "potential" or the negative of these terms or other similar expressions. Forward looking statements are based on certain assumptions regarding the Company's expected growth, results of operations, performance, industry trends and growth opportunities. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive risks, uncertainties and contingencies that could cause actual results to differ materially from those expressed or implied in such statements. Investors are cautioned not to put undue reliance on forward looking statements. Applicable risks and uncertainties include, but are not limited to: credit, market, currency, operational, liquidity and funding risks, including changes in economic conditions, interest rates or tax rates, the impact of government regulation on the on-line gaming industry and the risk that such regulation is subject to change, competition from other providers of online gaming services, the possibility that the Company be unable to successfully integrate the B2B Business as described herein, the risks associated with international and foreign operations, the impact of consolidations in the online gaming industry and the other risks identified under the heading "Risk Factors" in the Company's final long form prospectus  dated December 18, 2014, as filed on SEDAR at www.sedar.com, and in other filings that NYX Gaming Group may make with applicable securities authorities in the future. The forward-looking statements contained herein reflect NYX Gaming Group's current views with respect to future events, and except as required by law, NYX Gaming Group does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events, or otherwise.

This release contains Non-IFRS financial measures and are noted where used. These financial measures are used by many investors to compare companies and management believes they are important measures in evaluating NYX Gaming Group. However, they are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. Therefore, they may not be comparable to similar measures presented by other issuers. Investors are cautioned that such measures should not be construed as alternatives to comparable IFRS measures determined in accordance with IFRS.

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.

SOURCE NYX Gaming Group Ltd.



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