Tuesday September 21, 6:13 pm Eastern Time
Company Press Release
SOURCE: American Wagering, Inc.
American Wagering Announces 2nd Quarter Results
LAS VEGAS, Sept. 21 /PRNewswire/ -- American Wagering, Inc. (Nasdaq: BETM - news) today announced results for the 2nd quarter ending July 31, 1999 and 6 month period ending July 31, 1999. For the 3 months ending July 31, 1999, revenues increased $623,000 or 38.2% to $2,256,000 from the year ago period. The increase was primarily driven by a 103.6% or $693,000 in revenues from Systems operations. The Systems revenue increase was primarily driven by a 95.1% or $636,000 increase in revenues from the Company's CBS operations due to increased ticket paper and equipment sales.
Revenues from Wagering operations decreased $84,000 or 10.4%. Handle (total amount wagered) from U.S. operations increased 5.1% to $21,773,000 over last year and win percentage increased to 4.5% from 3.9% last year. The decrease in total wagering revenues was principally due to the Company's Mega$ports (ACT) which incurred wagering losses of $251,000 for the 3 month period ended July 31, 1999.
The Company incurred a net loss from continuing operations of $986,000 during the 2nd quarter of 1999, a 13.1% decrease over the net loss from continuing operations of $1,135,000 in the year ago quarter. Total net loss for the quarter ended July 31, 1999 was $479,130 or $0.06 per share comparing favorably with a net loss of $1,134,634 or $0.15 per share in the year ago period. Included in the net loss for the 3 month period ended July 31, 1999 was start up expenses relating to the commencement of operations of the Company's Internet and Keno businesses totaling $429,000.
For the 6 months ended July 31, 1999, revenues increased 32.7% to $5,267,000 as compared with revenues of $3,969,000 in the year ago 6 month period. The revenue increase was driven by an $832,000 increase in Systems revenues and a $399,000 increase in Wagering revenues. The net loss from Continuing Operations was $735,000 for the 6 months ended July 31, 1999, a 28.1% decrease from the loss of $1,022,000 in the year ago 6 month period. Total net loss for the 6 months ended July 31, 1999 was $274,502 or $0.04 per share as compared with a net loss of $1,021,857 or $0.13 per share in the year ago period. The net loss included start up expenses for the 6 month period ending July 31, 1999 relating to the Company's Internet and Keno operations totaled $564,000
Commenting on the improved results, American Wagering, Inc. CEO Victor Salerno said, ``The 2nd quarter is consistently a weak quarter with the absence of football or basketball betting, the sports which receive the most attention from sports bettors. We were very pleased to see the increase in sales from our Systems division as our goal has been to generate revenues from various sources which will lessen the effects of the volatile wagering revenues. With sports betting revenues, your handle can surge but if the games go against you, the wagering revenues could be very low. With our expanded Systems division, we generate an increase in recurring revenues. Our new Keno system which was recently launched as well as other products which we have in development all work towards that same goal of generating a constant revenue stream without the volatility of sports wagering.'
American Wagering, Inc. owns and operates Leroy's Horse and Sports Place, the licensed bookmaker with the largest number of sports book locations (45) in the state of Nevada; CBS, the dominant supplier of sports and race book equipment and software in Nevada and creator and operator of Mega$ports. The Company also owns and operates an Australian subsidiary which operates Mega$ports on the Internet.
The statements contained in this release, which are not historical facts contain forward-looking information with respect to plans, projections or future performance of American Wagering, Inc., the occurrence of which involves certain risks and uncertainties, including that American Wagering takes financial risks on the outcome of sporting events as a principal betting against the patrons; an increase or decrease in handle is not necessarily indicative of an increase or decrease in revenues or profits. Investors should also examine other uncertainties detailed in American Wagering's filings with the SEC.
AMERICAN WAGERING, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JULY 31, 1999 AND 1998
1999 1998
REVENUES $2,256,484 $1,633,413
OPERATING COSTS AND EXPENSES:
Direct costs 2,037,817 1,269,424
Research and development 191,862 139,388
Selling, general and administrative 768,941 1,136,254
Depreciation and amortization 207,306 167,261
TOTAL OPERATING COSTS AND EXPENSES 3,205,926 2,712,327
OPERATING LOSS (949,442) (1,078,914)
OTHER INCOME (EXPENSE):
Interest income 3,023 34,692
Other income 1,319 78,593
Minority Interest (1,354) --
Equity in loss from joint venture -- (86,866)
Interest expense (39,974) (82,139)
TOTAL OTHER EXPENSE (36,986) (55,720)
LOSS FROM CONTINUING OPERATIONS
BEFORE PROVISION (BENEFIT) FOR INCOME TAXES(986,428) (1,134,634)
PROVISION (BENEFIT) FOR INCOME TAXES -- --
LOSS FROM CONTINUING OPERATIONS (986,428) (1,134,634)
DISCONTINUED OPERATIONS:
Gain on sale of hotel, food and beverage
operations, net of income tax 341,403 --
Excess reserve -- loss on disposal 213,465 --
INCOME FROM DISCONTINUED OPERATIONS 554,868 --
NET LOSS (431,560) (1,134,634)
PREFERRED STOCK DIVIDEND REQUIREMENTS (47,570) --
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $(479,130) $(1,134,634)
INCOME (LOSS) PER SHARE OF COMMON STOCK
Loss from continuing operations
Basic $(0.13) $(0.15)
Diluted $(0.13) $(0.15)
Income from discontinued operations
Basic $0.07 --
Diluted $0.07 --
Net loss
Basic $(0.06) $(0.15)
Diluted $(0.06) $(0.15)
AMERICAN WAGERING, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JULY 31, 1999 AND 1998
1999 1998
REVENUES $5,266,607 $3,968,781
OPERATING COSTS AND EXPENSES:
Direct costs 3,803,402 2,634,422
Research and development 343,242 278,660
Selling, general and administrative 1,395,606 1,440,812
Depreciation and amortization 395,451 331,557
TOTAL OPERATING COSTS AND EXPENSES 5,937,701 4,685,451
OPERATING LOSS (671,094) (716,670)
OTHER INCOME (EXPENSE):
Interest income 10,542 100,443
Other income 1,319 161,702
Minority Interest 3,669 --
Equity in loss from joint venture -- (384,068)
Interest expense (79,452) (183,264)
TOTAL OTHER EXPENSE (63,922) (305,187)
LOSS FROM CONTINUING OPERATIONS
BEFORE PROVISION (BENEFIT) FOR INCOME TAXES(735,016) (1,021,857)
PROVISION (BENEFIT) FOR INCOME TAXES -- --
LOSS FROM CONTINUING OPERATIONS (735,016) (1,021,857)
DISCONTINUED OPERATIONS:
Gain on sale of hotel, food and beverage
operations, net of income tax 341,403 --
Excess reserve -- loss on disposal 213,465 --
INCOME FROM DISCONTINUED OPERATIONS 554,868 --
NET LOSS (180,148) (1,021,857)
PREFERRED STOCK DIVIDEND REQUIREMENTS (94,354) --
NET LOSS AVAILABLE TO
COMMON SHAREHOLDERS $(274,502) $(1,021,857)
INCOME PER SHARE OF COMMON STOCK
Loss from continuing operations
Basic $(0.11) $(0.13)
Diluted $(0.11) $(0.13)
Income from discontinued operations
Basic $0.07 --
Diluted $0.07 --
Net loss
Basic $(0.04) $(0.13)
Diluted $(0.04) $(0.13)
SOURCE: American Wagering, Inc.
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