— Continued growth in installed base from
exclusive product portfolio driving revenue growth —
VANCOUVER, May 22, 2018 /CNW/ - INTEGRITY GAMING
CORP. (TSX-V: IGAM) (OTCQX: IGAMF) ("Integrity" or the
"Company") today announces financial results for the first quarter
ended March 31, 2018 (all amounts
stated in U.S. dollars unless otherwise indicated).
First Quarter 2018 Highlights & Financial
Results
- 6.9% increase in revenue to $4.4
million, over $4.2 million in
Q1 2017.
- Adjusted EBITDA relatively flat year-over-year at $2.4 million, compared to $2.4 million in Q1 2017.
- Operating cash flow before changes in current non-cash working
capital of $976k, compared to
$944k in Q1 2017.
- Net loss of $0.9 million for Q1
2018, compared to a net loss of $1.2
million in Q1 2017.
- At quarter end, Integrity held participating interests in
approximately 2,707 revenue generating machines, compared to 2,650
at March 31, 2017.
"We achieved solid growth in revenue in the first quarter of
2018, reflecting our success at increasing our machine base, both
through exclusive and non-exclusive products offerings, and
optimizing machines placements to achieve better unit economics,"
said Peter Macy, CEO of Integrity.
"We're off to a good start for the year and we will continue to
drive growth by actively managing our current machines, increasing
our penetration with new and exclusive product offerings, adding
new casinos to our roster, and introducing innovative games and
technologies including iGaming that will enhance our profile as a
leader in the tribal gaming industry."
Selected operating and financial information and reconciliation
of net income (loss) to Adjusted EBITDA is as follows:
|
Q1 2018
|
Q4 2017
|
Q3 2017
|
Q2 2017
|
Q1 2017
|
Q4 2016
|
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
Weighted average
number of machines
|
2,701
|
2,622
|
2,529
|
2,583
|
2,650
|
2,548
|
Leasing Payments
*
|
4,276,700
|
3,781,240
|
3,833,128
|
3,922,972
|
4,058,507
|
4,001,201
|
Reported
Revenue
|
4,443,280
|
4,062,627
|
3,898,110
|
4,250,547
|
4,157,374
|
4,027,458
|
COGS: Casino supplies
and equipment
|
(633,979)
|
(320,786)
|
(428,829)
|
(428,595)
|
(354,373)
|
(337,437)
|
Operating
expenses
|
(2,252,720)
|
(2,317,861)
|
(2,474,213)
|
(2,335,795)
|
(2,268,483)
|
(2,797,730)
|
General and
administrative expenses
|
(1,439,193)
|
(1,372,907)
|
(1,554,085)
|
(1,546,981)
|
(1,490,607)
|
(800,093)
|
Amortization of
intangible assets
|
(198,775)
|
(200,375)
|
(200,642)
|
(199,576)
|
(198,775)
|
(218,337)
|
Gain (loss) on
disposal of assets
|
-
|
-
|
990
|
23,200
|
108,212
|
(12,750)
|
Impairment of
placement fees
|
-
|
-
|
-
|
-
|
-
|
(1,732,152)
|
Loss from
operations
|
(81,387)
|
(149,302)
|
(758,669)
|
(237,200)
|
(46,652)
|
(1,871,041)
|
Financing
costs
|
(932,950)
|
(3,882,101)
|
(1,163,893)
|
(1,145,358)
|
(1,140,346)
|
(1,153,146)
|
Foreign exchange gain
(loss)
|
1,897
|
(299)
|
(1,948)
|
196
|
(8,466)
|
(745)
|
Gain on sale of
Bingo
|
-
|
139,032
|
-
|
-
|
-
|
-
|
Gain on settlement of
debt
|
-
|
194
|
580
|
(224)
|
28,380
|
-
|
Revaluation of exit
fee liability
|
105,464
|
-
|
-
|
-
|
-
|
-
|
Revaluation of
earn-out liability
|
-
|
-
|
-
|
-
|
-
|
(30,000)
|
Income tax recovery
(expense)
|
(10,000)
|
(3,307)
|
(98,199)
|
-
|
-
|
119,904
|
Net Income
(loss)
|
(916,976)
|
(3,895,783)
|
(2,022,129)
|
(1,382,586)
|
(1,167,084)
|
(2,935,028)
|
Adjustments:
|
|
|
|
|
|
|
|
Depreciation of
equipment
|
1,277,063
|
1,321,685
|
1,599,168
|
1,525,644
|
1,390,548
|
1,074,475
|
|
Amortization of
placement fees
|
441,393
|
441,393
|
424,863
|
449,658
|
449,658
|
533,904
|
|
Amortization of
intangible assets
|
198,775
|
200,375
|
200,642
|
199,576
|
198,775
|
218,337
|
|
Income tax expense
(recovery)
|
10,000
|
3,307
|
98,199
|
-
|
-
|
(119,904)
|
|
Finance lease
receivable reduction
|
525,263
|
204,521
|
538,231
|
308,392
|
467,486
|
513,064
|
|
Financing
costs
|
932,950
|
3,882,101
|
1,163,893
|
1,145,358
|
1,140,346
|
1,153,146
|
|
Foreign exchange
(gain) loss
|
(1,897)
|
299
|
1,948
|
(196)
|
8,466
|
745
|
|
Impairment of
placement fees
|
-
|
-
|
-
|
-
|
-
|
1,732,152
|
|
Gain on settlement of
debt
|
-
|
(194)
|
(580)
|
224
|
(28,380)
|
-
|
|
Loss (gain) on
disposal of assets
|
-
|
(139,032)
|
(990)
|
(23,200)
|
(108,212)
|
12,750
|
|
Revaluation of
earn-out liability
|
-
|
-
|
-
|
-
|
-
|
30,000
|
|
Revaluation of exit
fee liability
|
(105,464)
|
-
|
-
|
-
|
-
|
-
|
|
Stock based
compensation
|
56,627
|
89,024
|
92,691
|
116,416
|
92,919
|
102,272
|
|
Employee separation
fees
|
-
|
-
|
290,000
|
-
|
-
|
-
|
Adjusted
EBITDA
|
2,417,734
|
2,107,696
|
2,385,936
|
2,339,286
|
2,444,522
|
2,315,913
|
* Leasing Payments
consist of leasing revenue reported under IFRS plus finance lease
receivable reduction.
|
Conference Call
The Company will hold a conference call to discuss the results
for its first quarter ended March 31,
2018. The call will be hosted by Peter Macy, CEO, and Adam Kniec, CFO on Thursday, May 24, 2018 at 8:30 a.m. PST (11:30 a.m.
EST), followed by a question and answer period. All
interested parties are invited to participate.
Conference Call
Details:
|
|
|
|
Date:
|
Thursday, May 24, 2018
|
Time:
|
8:30 a.m. Pacific
Time / 11:30 a.m. Eastern Time
|
|
|
Dial-In
Numbers:
|
North America
Toll-Free Dial-In Number:
|
1 (888)
231-8191
|
|
For
Toronto:
|
(647)
427-7450
|
|
For
Vancouver:
|
(778)
371-9827
|
|
|
Conference
ID:
|
8596356
|
TAPED
|
1 (855) 859‐2056
|
REPLAY:
|
Available until 12:00 midnight (EST) Thursday, May 31, 2018
|
|
Reference number: 8596356
|
About Integrity Gaming Corp.:
Formerly
Poydras Gaming Finance Corp., Integrity Gaming Corp. is a regional
slot route operator with over 2,700 gaming machines in operation
across over 30 casinos in Oklahoma
and Texas. The Company primarily derives its revenue from
short- and long-term revenue share contracts with Native American
casinos. It provides gaming equipment such as slot machines
and electronic table games, and project financing to owners,
operators, and managers of casinos and other regulated gaming
venues. The Company works with casinos, new casino
developments, and gaming machine suppliers. Additional
information about the Company can be found on the Company's website
at www.integritygaming.com and on the SEDAR website at
www.sedar.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.
Cautionary Note Regarding Forward‐Looking
Statements
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,
including those statements relating to expected EBITDA, and the
placement of additional machines by the Company, 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.
Non‐IFRS Measures
Adjusted EBITDA is a financial
measure that does not have a standardized meaning under IFRS.
Adjusted EBITDA is defined as earnings before financing costs,
income taxes, depreciation, amortization, stock based compensation,
unrealized foreign exchange, impairment of loans receivable,
impairment of placement fees, gain/loss on settlement of debt,
gain/loss on disposal of assets, gain/loss on disposal of BitBoss,
finance lease receivable reduction, revaluation adjustment of
earn-out liability, revaluation of exit fee liability, employee
separation fees and non-recurring costs.
During the current quarter, the Company modified its definition
of Adjusted EBITDA by adjusting its earnings by revaluation of exit
fee liability. The Company believes that to measure the
Company's core business performance and liquidity, and to measure
its ability to purchase additional machines, it is important to
include this adjustment in determination of Adjusted EBITDA.
As there is no standardized method of calculating Adjusted
EBITDA, it may not be directly comparable with similarly titled
measures used by other companies. The Company considers
Adjusted EBITDA to be a relevant indicator for measuring trends in
performance and its ability to generate funds to service its debt
and to meet its future working capital and capital expenditure
requirements. Adjusted EBITDA is not a generally accepted earnings
measure and should not be considered in isolation or as an
alternative to net income (loss), cash flows or other measures of
performance prepared in accordance with IFRS.
SOURCE Integrity Gaming Corp.