American Wagering Announces 3rd Quarter and 9 Months Results
Reports Strong Improvement in Nevada Operations
LAS VEGAS, Dec. 17 /PRNewswire/ -- American Wagering, Inc. (Nasdaq: BETM) today announced financial results for the 3rd quarter and 9 months ended October 31, 1999. Revenues for the quarter ended October 31, 1999 rose 47.5% to $3,884,000 as compared with $2,633,000 in the year ago quarter. The increase in revenues was attributed primarily to an increase in wagering and systems revenues.
Revenues from wagering operations rose 52% over last year to $2,253,000 due to an increase in the U.S. net win percentage. The net win percentage from U.S. operations for the 3rd quarter ended October 31, 1999 rose to 8.1% compared to 4.5% in the year ago quarter.
Revenues from systems operations rose 43.4% to $1,425,000 in the 3rd quarter ending October 31, 1999. The increase was attributed primarily to an increase of 65.6% in revenues at the Company's CBS unit due principally to increased equipment sales.
The Company generated a net operating loss of $261,000 for the 3rd quarter ending October 31, 1999, an improvement of $416,000 or 61.4% from an operating loss of $677,000 in the year ago quarter. The Company incurred operating losses of $382,000 at their new wagering entities of Mega$ports U.S. and ACT and $292,000 for AWI Keno which began operations in August of 1999. Also offsetting increased revenues were research and development costs of $278,000 during the quarter.
For the 9 months ending October 31, 1999, revenues increased $2,549,000 or 38.6% to $9,151,000 versus $6,602,000 in the year ago period. Revenues from wagering operations rose $1,171,000 or 32.5% to $4,778,000 primarily due to an increase in U.S. net win percentage to 6.6% as compared with 4.8% in the year ago 9 month period. Systems operations revenues rose $1,263,000 or 49.8% to $3,800,000 primarily due to a 52% increase in CBS operations revenue due to increased equipment sales due to new casino openings.
The operating loss from continuing operations for the 9 months ended October 31, 1999 was $996,000 comparing favorably by $703,000 to the loss from continuing operations of $1,699,000 in the year ago period. Losses at the new wagering entities of Mega$ports US and ACT and AWI Keno totaled $1,586,000 for the 9 month period ending October 31, 1999. The Company also incurred research and development costs of $621,000.
Commenting on the strong improvement in year over year results, American Wagering CEO Victor Salerno said, "We are pleased with the results of our established businesses. Excluding recently consolidated and start up operations, the Company reported an improvement in operating profit of $1 million over the prior year third quarter. Our Nevada sports book operations had a very strong 3rd quarter and 9 month period. This segment of our business generated operating profits of $700,000 for the quarter. In addition, the new casino openings in Las Vegas helped spur strong gains in the supply side of our business with our CBS unit generating strong equipment sales during the period. The start up of operations in Australia and our newest Keno product, "The Game" were the primary reason for the operating losses in the period. With our recent approval of the Keno system and the installation in additional casinos, we feel that this will be a contributor to increased revenues going forward and look forward to updating everyone on new contracts as they are signed."
American Wagering, Inc. owns and operates Leroy's Horse and Sports Place, the licensed bookmaker with the largest number of sports book locations (47) in the state of Nevada; CBS, the dominant supplier of sports equipment and software in Nevada and creator and operator of Mega$ports; and AWI Keno, Inc. which is the systems operator for interlinked Casino games. The Company also owns and operates an Australian subsidiary which operate Mega$ports on the Internet.
The statements contained in this release, which are not historical facts contain forward-looking information with respect to plans, projections or the future performance of American Wagering, Inc., the occurrence of which involves certain risks and uncertainties, including that American Wagering takes financial risks on the outcome of sporting events as a principal betting against the patrons; an increase or decrease in handle is not necessarily indicative of an increase or decrease in revenues or profits. The statements contained in this release, which are not historical facts contain forward- looking information with respect to plans, projections or the future performance of American Wagering, Inc., the occurrence of which involves certain risks and uncertainties, including that American Wagering takes financial risks on the outcome of sporting events as a principal betting against the patrons; an increase or decrease in handle is not necessarily indicative of an increase or decrease in revenues or profits. There can be no assurance that Mega$ports US and ACT and AWI Keno will be operated profitably. 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 OCTOBER 31, 1999 AND 1998
1999 1998
REVENUES $3,883,988 $ 2,633,333
OPERATING COSTS AND EXPENSES:
Direct costs 2,701,221 1,880,120
Research and development 277,776 148,072
Selling, general and administrative 907,072 872,731
Depreciation and amortization 218,124 219,523
TOTAL OPERATING COSTS AND EXPENSES 4,104,193 3,120,446
OPERATING INCOME (220,205) (487,113)
OTHER INCOME (EXPENSE):
Interest income 13,947 12,822
Other income (38,722) 77,395
Minority Interest 22,937 (4,018)
Equity Loss from joint venture -- (196,638)
Interest expense (39,296) (79,413)
TOTAL OTHER EXPENSE (41,134) (189,852)
LOSS FROM CONTINUING OPERATIONS
BEFORE PROVISION (BENEFIT) FOR INCOME TAXES (261,339) (676,965)
PROVISION (BENEFIT) FOR INCOME TAXES -- --
NET LOSS (261,339) (676,965)
PREFERRED STOCK DIVIDEND REQUIREMENTS (42,417) --
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $ (303,756) $ (676,965)
INCOME (LOSS) PER SHARE OF COMMON STOCK
Net loss
Basic $ (0.04) $ (0.09)
Diluted $ (0.04) $ (0.09)
AMERICAN WAGERING, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED OCTOBER 31, 1999 AND 1998
1999 1998
REVENUES $9,150,595 $ 6,602,114
OPERATING COSTS AND EXPENSES:
Direct costs 6,504,623 4,514,542
Research and development 621,018 426,732
Selling, general and administrative 2,302,678 2,500,430
Depreciation and amortization 613,575 551,080
TOTAL OPERATING COSTS AND EXPENSES 10,041,894 7,992,784
OPERATING LOSS (891,299) (1,390,670)
OTHER INCOME (EXPENSE):
Interest income 24,490 119,642
Other income (37,404) 232,720
Minority interest 26,606 (4,018)
Equity in loss from joint venture -- (393,819)
Interest expense (118,749) (262,677)
TOTAL OTHER EXPENSE (105,057) (308,152)
LOSS FROM CONTINUING OPERATIONS
BEFORE PROVISION (BENEFIT)
FOR INCOME TAXES (996,356) (1,698,822)
PROVISION (BENEFIT) FOR INCOME TAXES -- --
LOSS FROM CONTINUING OPERATIONS (996,356) (1,698,822)
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 (441,488) (1,698,822)
PREFERRED STOCK DIVIDEND REQUIREMENTS (136,771) --
NET LOSS AVAILABLE TO COMMON SHAREHOLDERS $(578,259) $(1,698,822)
INCOME PER SHARE OF COMMON STOCK
Loss from continuing operations
Basic $ (0.14) $ (0.22)
Diluted $ (0.14) $ (0.22)
Income from discontinued operations
Basic $ 0.07 $ 0.00
Diluted $ 0.07 $ 0.00
Net (loss)
Basic $ (0.07) $ (0.22)
Diluted $ (0.07) $ (0.22) |
