FYI: CryptoLogic lowers expectations for third quarter
CryptoLogic Inc CRY
Shares issued 11,222,462 Sep 28 close $21.90
Fri 29 Sept 2000 News Release
Mr. Andrew Rivkin reports
CryptoLogic anticipates that results for the third quarter ended Sept. 30,
2000, will be lower than analysts' estimates. Third quarter performance
continued to be affected by the timing of the version 4.0 rollout as well
as aggressive investment to launch a rapid succession of major new
licensees on and ahead of schedule.
Management expects total revenue for the third quarter in 2000 to be
approximately $9.0-million, an increase of 12.5 per cent compared with
$8.0-million (U.S.) in the 1999 third quarter. The company's net income is
expected to be $2.7-million (U.S.) compared with $4.8-million (U.S.) in the
1999 third quarter. Management expects that net margins will average over
40 per cent for year 2000.
"Two thousand has been a pivotal year, focused on advancing the company to
the next level with next generation technology, significant infrastructure
investment and adding leading land-based licensees," said CryptoLogic's
president and chief executive officer, Andrew Rivkin. "Although the growth
numbers for this year have been modest, we are confident that our strategy
will bear positive results and solidify our global leadership. By year-end,
CryptoLogic will have on-line the largest number of brand name Internet
gaming licensees in the world with the brand power, top-notch technology
and financial strength to gain major market share."
Mr. Rivkin added, "CryptoLogic continues to be a fundamentally solid
organization, with the highest revenue, profitability and cash position in
the industry. Version 4.0 is now out, marketing campaigns are underway,
eBet's casino is launched ahead of schedule and the remaining licensees
will be ready to go shortly. The fourth quarter is looking good and the
outlook for 2001 is promising, with stronger growth rates expected for next
year."
With version 4.0 introduced later than expected, the revenue surge
anticipated in the latter half of 2000 has now shifted largely into the
first quarter of 2001. Management expects that the continuing rollout of
version 4.0 and the launch of the remaining licensees will have the desired
top line results.
Expenditures were also higher than expected in the third quarter as a
result of adding major new licensees. CryptoLogic accelerated investment in
development and support services to get new licensees up and running
quickly as well as enhancing infrastructure capacity and continuing
software certification in Australia. The company continues to maintain
profitability and expects this to improve in the foreseeable future as
today's investments drive a significant increase in revenues.
CryptoLogic continues to view its shares as an exceptional investment at
current prices. Since renewing it share buy back program in mid May,
CryptoLogic has bought about 40 per cent of the authorized amount or
217,600 shares.
Preliminary third quarter numbers are estimates only and actual results may
vary. Final results for the third quarter of fiscal 2000 will be reported
by the end of October, 2000.
An analyst/shareholder conference call to discuss the preliminary results
has been scheduled for Monday, Oct. 2, 2000, at 11 a.m., ET. Interested
parties should call either 1-800-478-9326 or 416-695-5801.
(c) Copyright 2000 Canjex Publishing Ltd. stockwatch.com
>>>
Later...Gator |
