Company Press Release
SOURCE: Casino Journal Publishing Group, Inc.
Casino Journal Publishing Group Reports 300% Increase In 6 Month Earnings Per Share
Highlights 2nd Quarter Revenues sets record of $3,638,920: +39% 6 Month Revenues sets record of $6,756,416: +44% 2nd Quarter EBITDA sets record of $495,000 or .10 per share 6 Month EBITDA sets record of $799,000 or .16 per share 'Best of' Casino Player Issue sets new monthly advertising record of $516,000 Letter of Intent With BG Media Expires
LAS VEGAS, Aug. 16 /PRNewswire/ -- Casino Journal Publishing Group, Inc. (OTC Bulletin Board: CJPG - news) today announced record results for the 2nd quarter and 6 month financial reporting periods ending June 30, 1999. The 2nd quarter and 6 month periods set records in just about every aspect of the Company.
REVENUES
Revenues for the 2nd quarter totaled $3,638,920 as compared with $2,624,699 in the year ago period, up 39% or $1,014,221. The increase in revenues were driven by a 33% increase in advertising revenues to $1,984,005 and a 95% increase in subscription revenues to $825,075.
Revenues for the 6 month period ending June 30, 1999 rose 44% to $6,756,416 from $4,705,033 in the year ago period. Advertising revenues rose 30% to $3,530,629 while subscription revenues rose 73% to $1,607,357. Revenues from the Company's trade shows nearly doubled from the year ago period to $1,186,148.
The dramatic Subscription revenue growth for the 2nd quarter and 6 month period were a direct result of the Company's aggressive marketing promotions which took place in 1998 along with the release of the Company's newest consumer magazine, Strictly Slots, in December of 1998. Strictly Slots has generated cash subscription revenue of approximately $1 million since the launch in December while Casino Player has increased its paid circulation during that time. The record advertising revenues for the 2nd quarter and 6 month period were driven by increased circulation of Casino Player, the successful launch of Strictly Slots and a 15% increase in advertising revenue at the Company's flagship Trade publication, Casino Journal.
EBITDA
EBITDA (Earnings Before Interest Taxes, Depreciation and Amortization) rose 155% for the 6 month period ending June 30, 1999 to $799,000 or 0.16 per average share outstanding. For the 2nd quarter, EBITDA rose to $495,000 from $491,000. EBITDA, on a comparison basis over 1998, was negatively affected by amortization of past promotional expenses. In the first 6 months of 1998, there were no promotional expenses amortized. EBITDA before amortization of promotional expenses was $595,000 or 0.12 per share in the 2nd quarter and $950,000 or 0.19 per share for the 6 months ended June 30, 1999.
EPS
Earnings per share (EPS) grew to 0.09 per basic and diluted weighted average share outstanding for the 6 months ended June 30, 1999, a 300% increase over the 0.03 per share reported in the 6 months ended June 30, 1998. EPS for the 2nd quarter 1999 was 0.06 per share versus 0.07 per share in 2nd quarter 1998. The decrease in EPS was due to the amortization of past promotional expenses in fiscal 1999 against no amortization of past promotional expenses in 1998, a higher reserve for income taxes in the 2nd quarter of 1999 and a higher number of average shares outstanding due to the Company being public for a full year.
LETTER OF INTENT
Casino Journal Publishing Group, Inc. also announced today that the letter of intent with BG Media Investors LP for negotiating a transaction whereby BG Media would acquire control of the Company was expiring today and would not be extended. The 2 companies were unable to reach agreement on the various aspects of the transaction and both parties agreed that an extension of the letter of intent was not in the best interest of the parties. While Casino Journal Publishing Group, Inc. will consider any offer which is brought to the Company by any Interested Party, it is no longer actively seeking a buyer of the Company and will focus more on enhancing shareholder value by undertaking a marketing campaign to generate interest in the Company's common stock trading and seeking financing to implement the next aggressive marketing campaign.
As of June 30, 1999, Casino Journal Publishing Group, Inc. had total assets of $7,925,943. The return to profitability in the first half of 1999 has increased the Company's Net Tangible Assets to $2,192,812. Although the Company has generated audited revenues of $22,000,000 over the last 3 years, which resulted in the restriction of being a ``Penny Stock' removed, compliance officers of many broker dealers would not give approval for their brokers to recommend the Company's stock due to the Net Tangible Assets being below $2 million. With the Company's Net Tangible Assets now in excess of $2 million, the Company is no longer considered a ``Penny Stock' under rule 15g-9 under the Exchange Act, thus not imposing additional sales practice requirements on broker-dealers.
COMPANY COMMENT
Commenting on the earnings and events which occurred in the first half of 1999, Casino Journal Publishing Group, Inc. Chairman, CEO and Group Publisher, Glenn Fine, said, ``It may be hard to believe by looking at our financial results for the first 6 months of 1999, but the negotiations with BG Media did distract management and slow the Company down a little. Discussions have been underway about some joint ventures and other transactions and the parties we were discussing business with were not comfortable entering into serious negotiations until they knew what the status was with our talks with BG Media. We expect to complete one or more of these transactions in the 3rd quarter.'
Alan Woinski, President and CFO of the Company added, ``While our door remains open to any Parties who are interested in making an offer which will enhance shareholder value, the focus of the Company will now be on continuing the raging growth, increasing the value and activity of our Common Stock, and generating the financing the Company needs to not only complete the next phase of our growth plan but also to list our Company on either the Nasdaq or AMEX stock markets. Management knows quite well that at the current market capitalization of our Company, we will remain a target for others looking to capitalize on our low market value. With Friday's bid price, the Company is valued at $11.25 million. We are on pace to generate over $12 million in revenues this year, up 33% from last year and in the year 2000, our revenues should be double what they were in 1997. It is not very often where you see a company with over 30% annual growth in its past 3 years and .16 per share in EBITDA in the first 6 months of its current year which trades at the low multiple that we do. We are aware that part of the reason is the stigma which is attached to many of the companies trading on the OTC Bulletin Board and the Company will use every effort to increase the value of our common stock and move the trading to a listed exchange.'
Casino Journal Publishing Group, Inc. publishes Casino Journal, the company's flagship magazine, and the most widely read trade publication serving the gaming industry; the National Gaming Summary, an extensive weekly newsletter that provides up-to-the-minute gaming news; the Gaming Industry Weekly and Daily Reports and the Daily Lodging Report targeting gaming and lodging executives and investors.
For the gaming consumer, CJPG publishes Casino Player and Strictly Slots, the nation's largest circulation consumer gaming publications, and the Atlantic City Insider, which targets the frequent Atlantic City gambler.
The Company also produces the American Gaming, Lodging and Leisure Summit in conjunction with Bear Stearns & Co. and the law firm of Lionel Sawyer and Collins; the Southern Gaming Summit with the Mississippi Casino Operators Association; the Atlantic City Chamber of Commerce Business Expo, the Northern Gaming Summit in conjunction with the Michigan law firm of Fraser Trebilcock Davis & Foster and Bear Stearns & Co. and UNLV Casino Ops trade shows.
Safe Harbor: Certain statements in this press release, including statements regarding the anticipated development and expansion of the Company's business, and the intent, belief or current expectations of the Company, its directors or its officers, are ``forward-looking' statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.
CASINO JOURNAL PUBLISHING GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
Revenues $3,638,920 $2,624,699 $6,756,416 $4,705,033
Direct costs 1,802,546 1,029,240 3,430,839 2,182,449
Gross profit 1,836,374 1,595,459 3,325,577 2,522,584
General and
administrative
expenses 1,418,983 1,184,968 2,661,466 2,272,438
Income from
operations 417,391 410,491 664,111 250,145
Other income 8,857 30,668 19,115 6,517
Income before income
taxes and minority
interest 426,248 441,159 883,226 256,663
Income taxes 148,000 128,000 148,000 128,000
Income before
minority interest 278,248 313,159 535,226 128,663
Minority interest in
earnings (loss) of
American Gaming
Summit, LLC (5,208) -- 65,194 --
Net income $283,454 $313,159 $470,032 $128,663
Basic and diluted
income per share $.06 $.07 $.09 $.03
Shares used in
calculation of
income per share 4,984,097 4,533,020 4,979,071 3,803,245
SOURCE: Casino Journal Publishing Group, Inc.
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