MONTREAL, Oct. 18, 2016 /CNW/ - Amaya Inc. (NASDAQ:
AYA; TSX: AYA) today announced certain preliminary results for the
third quarter ended September 30,
2016 and provided full year financial guidance for 2016.
Unless otherwise noted, all dollar ($) amounts are in U.S.
dollars.
"We anticipate our third quarter performance will continue to
demonstrate the improving strength of PokerStars' core poker
business, as well as continued growth in our new verticals of
online casino and sports betting," said Rafi Ashkenazi, Chief
Executive Officer of Amaya. "Since earlier this year, our four
strategic priorities remain the same: (1) grow our leadership
position in online poker, (2) become a leader in online casino, (3)
build a competitive online sportsbook, and (4) achieve operational
excellence by improving efficiency and effectiveness throughout the
organization."
Mr. Ashkenazi further commented, "We are focused on applying our
industry leading technology platform to best serve our customers
and deliver high-quality customer service and a superior gaming and
entertainment experience, while continuing to deliver on our
overall strategy and corporate objectives for the benefit of our
shareholders."
Preliminary Third Quarter Results
Amaya currently expects to report the following:
- Revenues - Total revenues of between $268 to $273 million, as compared to
approximately $247 million of total
revenues for the third quarter ended September 30, 2015. Real-money online poker
revenues and real-money online casino and sportsbook combined
revenues are expected to represent approximately 73% and 24% of
expected total revenues for the quarter, respectively, as compared
to 81% and 15% for the prior year period.
- Quarterly Real-Money Active Uniques (QAUs) – Total
combined QAUs of 2.4 million, which would represent an increase of
approximately 5% year-over-year. Approximately 2.3 million of such
QAUs played online poker during the quarter, which would represent
an increase of approximately 3% year-over-year, while Amaya's
online casino offerings had approximately 490,000 QAUs and its
emerging online sportsbook offerings had approximately 230,000
QAUs.
- Quarterly Net Yield (QNY) – Total QNY of $110 to $111, which would represent an increase
of 4% to 5% year-over-year. QNY is a non-IFRS measure.
These views on anticipated results are based on management's
initial review of its operations and performance for the third
quarter ended September 30, 2016, do
not include all results expected to be reported, and are subject to
the completion of Amaya's customary quarterly closing and review
procedures.
Amaya expects to release its full financial results for the
third quarter ended September 30,
2016 on Monday, November 14,
2016, and will provide timing and conference call and
webcast details in the near future.
2016 Full Year Guidance
For the full financial year 2016, Amaya currently expects the
following:
- Revenues of $1,127 to
$1,157 million;
- Adjusted EBITDA of $490 to $510
million;
- Adjusted Net Earnings of $332 to $352
million; and
- Adjusted Net Earnings per Diluted Share of $1.71 to $1.82.
Amaya's current guidance ranges assume no (i) material adverse
regulatory events or (ii) material foreign currency exchange rate
fluctuations that could negatively impact customer purchasing power
as it relates to Amaya's U.S. dollar denominated product
offerings.
As previously reported, the purchase price for Amaya's
acquisition of the Rational Group in August
2014 included a $400 million
deferred payment payable on February 1,
2017. In addition to Amaya's required monthly excess cash
flow deposits, which were approximately $144
million as of September 30,
2016, and approximately $99
million of unrestricted cash on Amaya's balance sheet as of
the same date, Amaya is pursuing various non-dilutive options to
pay the balance of such deferred payment and expects to announce
the same by the end of the current fiscal year.
Adjusted EBITDA, Adjusted Net Earnings and Adjusted Net Earnings
per Diluted Share are non-IFRS measures. For important information
on Amaya's non-IFRS measures, see below under "Non-IFRS and
Non-U.S. GAAP Measures" and, with respect to expected QNY for the
third quarter ended September 30,
2016, the table under "Reconciliation of Non-IFRS Measures
to Nearest IFRS Measures". As a result of Amaya's change in
presentation currency from Canadian dollars to U.S. dollars during
the first quarter of 2016, the comparative and historical figures
disclosed herein have been retrospectively adjusted to reflect such
change as if the U.S. dollar had been used as the presentation
currency for all prior periods presented.
Reconciliation of Non-IFRS Measures to Nearest IFRS
Measures
The table below presents a reconciliation of the numerator of
QNY (i.e., real-money online poker revenue and real-money
online casino and sportsbook combined revenue) to the nearest IFRS
measure (i.e., total revenue):
|
|
Three Months Ended
September 30,
|
|
|
2016
|
|
2015
|
|
|
$000s
|
|
$000s
|
Total
revenue
|
|
268,241 -
273,241
|
|
247,327
|
Corporate
revenue
|
|
(0)
|
|
(225)
|
Other
business-to-consumer revenue
|
|
(8,632) -
(10,632)
|
|
(9,729)
|
Real-money online
poker revenue and real-money online casino and sportsbook combined
revenue
|
|
259,609 -
262,609
|
|
237,373
|
Amaya has not provided a reconciliation of the non-IFRS measures
to the nearest IFRS measures included in its full year 2016
financial guidance provided in this release, including Adjusted
EBITDA, Adjusted Net Earnings and Adjusted Net Earnings per Diluted
Share, because certain reconciling items necessary to accurately
project such IFRS measures, particularly net income (loss), cannot
be reasonably projected due to a number of factors, including
variability from potential foreign exchange fluctuations impacting
financial expenses, and the nature of other non-recurring or
one-time costs (which, for example, are excluded from non-IFRS
measures but included in net income(loss)).
Non-IFRS and Non-U.S. GAAP Measures
This news release references non-IFRS and non-U.S. GAAP
financial measures, including Adjusted EBITDA, Adjusted Net
Earnings, and Adjusted Net Earnings per Diluted Share. Amaya
believes these non-IFRS and non-U.S. GAAP financial measures will
provide investors with useful supplemental information about the
financial performance of its business, enable comparison of
financial results between periods where certain items may vary
independent of business performance, and allow for greater
transparency with respect to key metrics used by management in
operating its business. Although management believes these
financial measures are important in evaluating Amaya, they are not
intended to be considered in isolation or as a substitute for, or
superior to, financial information prepared and presented in
accordance with IFRS or U.S. GAAP. They are not recognized measures
under IFRS or U.S. GAAP and do not have standardized meanings
prescribed by IFRS or U.S. GAAP. These measures may be different
from non-IFRS and non-U.S. GAAP financial measures used by other
companies, limiting its usefulness for comparison purposes.
Moreover, presentation of certain of these measures is provided for
year-over-year comparison purposes, and investors should be
cautioned that the effect of the adjustments thereto provided
herein have an actual effect on Amaya's operating results. Amaya
uses the following non-IFRS and non-U.S. GAAP measures in this
release:
Adjusted EBITDA means net earnings (loss) from continuing
operations before interest and financing costs (net of interest
income), income taxes, depreciation and amortization, stock-based
compensation, restructuring and other non-recurring costs.
Adjusted Net Earnings means net earnings (loss) from continuing
operations before interest accretion, amortization of intangible
assets resulting from purchase price allocation following
acquisitions, stock-based compensation, restructuring, foreign
exchange, and other non-recurring costs. Adjusted Net Earnings per
Diluted Share means Adjusted Net Earnings divided by Diluted
Shares. Diluted Shares means the weighted average number of common
shares on a fully diluted basis, including options, warrants and
the Amaya's convertible preferred shares. The effects of
anti-dilutive potential common shares are ignored in calculating
Diluted Shares. As of September 30,
2016 and for the purposes of the full year 2016 guidance
provided in this release, Diluted Shares equals 193,866,395.
For additional information on Amaya's non-IFRS measures, see
Amaya's Management's Discussion and Analysis for the three and six
months ended June 30, 2016 (the "Q2
2016 MD&A"), including under the headings "Management's
Discussion and Analysis" and "Selected Financial Information—Other
Financial Information". Updated information will be provided in
Amaya's Management's Discussion and Analysis for the three and nine
months ended September 30, 2016 (the
"Q3 2016 MD&A") when publicly released by Amaya.
Key Metrics and Other Data
Amaya defines QAUs as active unique customers (online,
mobile and desktop client) who generated rake, placed a bet or
otherwise wagered (excluding free play, bonuses or other
promotions) on or through an Amaya poker, casino or sportsbook
offering during the applicable quarterly period. Amaya defines
unique as a customer who played at least once on one of Amaya's
real-money offerings during the period, and excludes duplicate
counting, even if that customer is active across multiple verticals
(e.g., both poker and casino).
Amaya defines QNY as combined real-money online gaming and
related revenue (excluding certain other revenues, such as revenues
from play-money offerings, live events and branded poker rooms) for
its two business lines (i.e., real-money online poker and
real-money online casino and sportsbook) as reported during the
applicable quarterly period (or as adjusted to the extent any
accounting reallocations are made in later periods) divided by the
total QAUs during the same period. QNY is a non-IFRS measure.
For additional information on Amaya's key metrics and other
data, see the Q2 2016 MD&A, including under the headings
"Limitations on Key Metrics and Other Data" and "Key Metrics".
Updated information will be provided in the Q3 2016 MD&A when
publicly released by Amaya.
About Amaya
Amaya is a leading provider of technology-based products and
services in the global gaming and interactive entertainment
industries. Amaya ultimately owns gaming and related consumer
businesses and brands including PokerStars, Full Tilt, BetStars,
StarsDraft and the PokerStars Championship and PokerStars Festival
live poker tour brands (incorporating the European Poker Tour,
PokerStars Caribbean Adventure, Latin American Poker Tour and the
Asia Pacific Poker Tour). These brands have more than 103 million
cumulative registered customers globally and collectively form the
largest poker business in the world, comprising online poker games
and tournaments, live poker competitions, branded poker rooms in
popular casinos in major cities around the world, and poker
programming created for television and online audiences. Amaya,
through certain of these brands, also offers non-poker gaming
products, including casino, sportsbook and daily fantasy sports.
Amaya, through certain of its subsidiaries, is licensed or approved
to offer, or offers under third party licenses or approvals, its
products and services in various jurisdictions throughout the
world, including in Europe, both
within and outside of the European Union, the Americas and
elsewhere.
Cautionary Note Regarding Forward Looking Statements
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and
applicable securities laws, including, without limitation, certain
financial and operational expectations and projections as it
relates to Amaya's preliminary third quarter results and full year
2016 financial guidance and certain operational plans and
strategies. Forward-looking statements can, but may not always, be
identified by the use of words such as "anticipate", "plan",
"continue", "estimate", "expect", "may", "will", "project",
"predict", "potential", "targeting", "intend", "could", "might",
"would", "should", "believe", "objective", "ongoing" and similar
references to future periods or the negatives of these words and
expressions. These statements, other than statements of historical
fact, are based on management's current expectations and are
subject to a number of risks, uncertainties, and assumptions,
including market and economic conditions, business prospects or
opportunities, future plans and strategies, projections,
technological developments, anticipated events and trends and
regulatory changes that affect us, our customers and our
industries. Although Amaya and management believe the expectations
reflected in such forward-looking statements are reasonable and are
based on reasonable assumptions and estimates, there can be no
assurance that these assumptions or estimates are accurate or that
any of these expectations will prove accurate. Forward-looking
statements are inherently subject to significant business,
regulatory, economic and competitive risks, uncertainties and
contingencies that could cause actual events to differ materially
from those expressed or implied in such statements. Specific risks
and uncertainties include, but are not limited to: the heavily
regulated industry in which Amaya carries on business; interactive
entertainment and online and mobile gaming generally; current and
future laws or regulations and new interpretations of existing laws
or regulations with respect to online and mobile gaming; potential
changes to the gaming regulatory scheme; legal and regulatory
requirements; ability to obtain, maintain and comply with all
applicable and required licenses, permits and certifications to
distribute and market its products and services, including
difficulties or delays in the same; significant barriers to entry;
competition and the competitive environment within Amaya's
addressable markets and industries; impact of inability to complete
future acquisitions or to integrate businesses successfully;
ability to develop and enhance existing products and services and
new commercially viable products and services; ability to mitigate
foreign exchange and currency risks; ability to mitigate tax risks
and adverse tax consequences, including, without limitation, the
imposition of new or additional taxes, such as value-added and
point of consumption taxes, and gaming duties; risks of foreign
operations generally; protection of proprietary technology and
intellectual property rights; ability to recruit and retain
management and other qualified personnel, including key technical,
sales and marketing personnel; defects in Amaya's products or
services; losses due to fraudulent activities; management of
growth; contract awards; potential financial opportunities in
addressable markets and with respect to individual contracts;
ability of technology infrastructure to meet applicable demand;
systems, networks, telecommunications or service disruptions or
failures or cyber-attacks; regulations and laws that may be adopted
with respect to the Internet and electronic commerce and that may
otherwise impact Amaya in the jurisdictions where it is currently
doing business or intends to do business; ability to obtain
additional financing on reasonable terms or at all; refinancing
risks; customer and operator preferences and changes in the
economy; dependency on customers' acceptance of its products and
services; consolidation within the gaming industry; litigation
costs and outcomes; expansion within existing and into new markets;
relationships with vendors and distributors; and natural events.
Other applicable risks and uncertainties include those
identified under the heading "Risk Factors and Uncertainties" in
Amaya's Annual Information Form for the year ended December 31, 2015 and "Risk Factors and
Uncertainties" and "Limitations of Key Metrics and Other Data" in
its Q2 2016 MD&A, each available on SEDAR at www.sedar.com,
EDGAR at www.sec.gov and Amaya's website at www.amaya.com, and in
other filings that Amaya has made and may make with applicable
securities authorities in the future. Investors are cautioned not
to put undue reliance on forward-looking statements. Any
forward-looking statement speaks only as of the date hereof, and
Amaya undertakes no obligation to correct or update any
forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
SOURCE Amaya Inc.