VANCOUVER, BC--(Marketwired - November 30, 2015) -
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Contagious Gaming Inc. (
"Contagious Gaming is committed to becoming a leader in developing and providing unique and engaging software solutions for regulated gaming and lottery operators around the world. Since going public in September 2014, we have made significant progress in advancing and launching our Goal Time betting platform with our media partner Trinity Mirror PLC; as well as continuing to position ourselves as a leader in the 'eInstants' category of the lottery market in North America," said Peter Glancy, CEO and Director. "Both the lottery and regulated gaming markets globally continue to become increasingly more mobile focused which is a key strength for us as we build out our business now and into the future."
Digitote Acquisition Update
The Company has made significant progress with the previously announced acquisition of Digitote Limited and Digitote Software GmbH Deutschland (together "Digitote"), a developer and provider of commercial-grade sports betting and horse racing technology, hardware, and support services to operators across Europe. The definitive acquisition agreement was signed on October 19, 2015. The closing of the Acquisition is expected to take place in early December 2015.
Change of CFO and Corporate Secretary
Contagious Gaming is pleased to announce that Mr. Craig Loverock, CPA, CA has been named Chief Financial Officer ("CFO") and Corporate Secretary of the Company effective immediately. Mr. Loverock takes over from Mr. Adam Kniec who has served as CFO and Corporate Secretary since the company went public. The Company's Board of Directors would like to thank Mr. Kniec for his valuable services as the Company's Chief Financial Officer over the past 22 months.
Craig Loverock is a Chartered Professional Accountant with over 20 years' experience in accounting and finance roles in Canada, the United States, and England. From October 2014 until May 2015, he served as the CFO of VoiceTrust Inc. From November 2012 until October 2014, Mr. Loverock served as the Chief Financial Officer and Chief Compliance Officer of Quartz Capital Group Ltd. From January 2010 until November 2012, he provided CFO consulting services to a number of high-growth businesses. Mr. Loverock served as the Senior Financial Advisor to the Chairman at Magna International from August 2007 to January 2010. Mr. Loverock received his B.Comm (Hons) from Carleton University in 1994 and received his Chartered Accountant designation from the Institute of Chartered Accountants, Ontario in 1997.
Goal Time Update
Contagious Gaming has made significant progress since its launch on December 21, 2014 with its media white label partner, Trinity Mirror PLC. The focus for the Company has been: 1) maximizing the return from its marketing spend by improving the cost per acquisition for a player; and 2) ensuring that the Goal Time technology and experience is consistently upgraded and improved.
As of September 30, 2015, Goal Time had 3,871 registered players. A significant number of these players were acquired near the end of the 2014/2015 Premier League season and we have experienced the continued momentum into the start of the 2015/2016 season. The majority (63%) of the registered players (year-to-date) are playing through their mobile devices and the average age of the registered player is 35. The Company has been able to improve its player conversion rate by utilizing the digital assets within the Trinity Mirror Group that have the highest conversion at a lower cost. As of September 30 2015, the Company has spent approximately £134k since December 2014 and approximately £25k since the start of this 2015/ 2016 season. This leaves the Company with £478k in remaining prepaid marketing resources with Trinity Mirror PLC. The Company has made the decision to minimize marketing spend until the development and testing of Goal Time version 2 ("Goal Time v2") is finished and the integration work into the Digitote's xTurf platform is complete.
The Company has completed the development of Goal Time v2 and is currently being tested by a third-party organization. Goal Time v2 offers the player a richer and more intuitive experience with more betting opportunities by adding the following: 1) updated and streamlined user interface; 2) ability for players to place multiple bets at the same time; 3) refined design and branding; and 4) dashboard feature highlighting featured games and results. Once the testing has been completed and the completion of the integration into Digitote's xTurf platform, Goal Time v2 will be ready to be submitted to the Apple Store UK for approval and will be available on the Goalti.me website for download on Android devices.
The Company is currently in the process of implementing Goal Time v2 onto Digitote's proprietary xTurf platform. This is expected to be completed in January 2016 and will provide Contagious Gaming the ability to: offer multiple combination (accumulator) wagering with varying amounts (small and large) bets; handle and offer a wider range of soccer matches; access to multiple payment providers who have already integrated into the xTurf platform/ eWallet, and sports-focused gaming content including virtual sports and fixed odds sport betting capabilities. The Company has applied for both a "Remote General Betting Standard -- Real Event" and "Remote Casino" licenses with the UK Gambling Commission to facilitate the operation of the anticipated expanded Goal Time offerings. Once integrated into xTurf, Goal Time will also be available to other gaming operators who are currently using the xTurf platform.
The Company expects the integration of Goal Time into Microgaming Networks' ("Microgaming") QuickFire platform to be complete in early 2016. The QuickFire platform offers fast and seamless integration into any existing system and covers all platforms including casino, poker, bingo, live dealer and mobile to a number of the world's leading gaming operators. This integration will expand Goal Time into new territories and benefit from Quickfire's extensive portfolio of over 300 gaming brands.
Digital Lottery Update
Contagious Gaming continues on its path as a leader in digital instant ("eInstant") content solutions for regulated markets. To date, lottery players have purchased approximately 840,000 eInstant games that are owned by the Company that generated approximately US$1.6 million in eInstant sales for the lotteries. Management believes that the Company's eInstant performance is promising, given the limited distribution and marketing efforts by the lotteries to date.
Growth within North America has been restricted historically due to limited marketing at the consumer level. It is management's belief that the industry is making a shift in technology away from desktop/ internet based distribution into a more mobile-focused model. The Company has invested in the transfer of its content portfolio into HTML5 to ensure it remains a leading innovator in eInstant content. The migration to HTML5 is complete and awaiting integration
The sector is continuing to evolve in North America and management is excited about the ongoing developments in North America and abroad as it continues to strength its relationship with its current partners and seeks new opportunities globally.
September 30, 2015 Q2 Financial Results:
- The Company generated $215,844 of revenue for the quarter ended September 30, 2015 compared with $209,398 for the quarter ended June 30, 2015.
- Adjusted EBITDA for the quarter ended September 30, 2015 amounted to a loss of $456,363 compared to Adjusted EBITDA loss of $503,497 for the quarter ended June 30, 2015.
- As at September 30, 2015 the company had a cash balance of $1,650,533 compared to $2,128,145 as at June 30, 2015.
September 30, 2015 Q2 Interim Financial Statements and Management Discussion and Analysis:
The Company's financial statements, notes to the financial statements and Management Discussion and Analysis ("MD&A") for the six months ended September 30, 2015 are available at www.sedar.com.
Non-IFRS Measures:
The following non-IFRS definitions are used in this news release because management believes that they provide useful information regarding our ongoing operations. Readers are cautioned that the definitions are not recognized measures under IFRS, do not have standardized meanings prescribed by IFRS, and should not be construed to be alternatives to revenues and net loss and comprehensive loss for the period determined in accordance with IFRS or as indicators of performance, liquidity or cash flows. Our method of calculating these measures may differ from the method used by other entities and accordingly our measures may not be comparable to similarly titled measures used by other entities or in other jurisdictions.
- Adjusted EBITDA as defined by the Company means earnings before interest and financing costs (net of interest income), income taxes, amortization, depreciation, RTO public listing, stock based compensation, stock based marketing compensation, transaction costs and acquisition related costs. Management believes that Adjusted EBITDA is a useful measure because it provides information to management about the operating and financial performance of the Company and its ability to generate operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures.
- Adjusted Earnings (Loss), as defined by the Company, means net income (loss) plus or minus items of note that management may reasonably quantify and that it believes will provide the reader with a better understanding of the Company's underlying business performance. For the purposes of the Company's current quarter MD&A, Adjusted Earnings (Loss) is calculated by adjusting net income (loss) for (i) financing costs related to extinguished debt, (ii) stock based compensation, (iii) stock based marketing compensation, (iv) RTO public listing, (v) transaction costs and (vi) acquisition related costs. Management believes that Adjusted Earnings (Loss) is an important indicator of the issuer's ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures and uses the metric for this purpose. Adjusted Earnings (Loss) is also used by investors and analysts for the purpose of valuing an issuer.
- Adjusted Earnings (Loss) per Share, as defined by the Company, means Adjusted Earnings (Loss) divided by the weighted average number of shares outstanding for the period. Management believes that Adjusted Earnings (Loss) is an important indicator of the issuer's ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt, and fund future capital expenditures and uses the metric for this purpose. Adjusted Earnings (Loss) per Share is also used by investors and analysts for the purpose of valuing an issuer.
During the current quarter, the Company modified its definition of Adjusted EBITDA by adjusting its earnings by acquisition related costs. Acquisition costs include professional fees, travel, due diligence and other costs incurred in the process of identifying and investigating acquisition targets and negotiating acquisition contracts. Acquisition costs are not considered to be the Company's normal operating costs, therefore the Company believes that to measure the Company's core business performance and liquidity it is important to include this adjustment in determination of Adjusted EBITDA.
The intent of Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share is to provide additional useful information to investors and analysts and these measures do not have any standardized meaning under IFRS. Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share should therefore not be considered in isolation or used as a substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Adjusted EBITDA, Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per Share differently.
A reconciliation of the adjusted measures noted above to results of operations under IRFS is included in the "Discussion of Operations" section of the Company's MD&A.
About Contagious Gaming
Contagious Gaming Inc. (
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.
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 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.
Contact Information:
For further information please contact:
Justin Barragan
Corporate Development
Email: justin.barragan@contagiousgaming.com
Phone: (647) 886-8551