Gamehost Inc.
TSX : GH

Gamehost Inc.

August 14, 2012 18:00 ET

Gamehost Announces Q2 2012 Financial Results and August Dividend

RED DEER, ALBERTA--(Marketwire - Aug. 14, 2012) - Gamehost Inc. (TSX:GH)

Management and Directors of Gamehost Inc. ("Gamehost", the "Company", the "Corporation", "Our") are pleased to present results for the six months ended June 30, 2012 (the "Period") and three months ended June 30, 2012 (the "Quarter").

Alberta Bubble?

Total operating revenues for the Quarter grew by 2.7% to $19.1 million from $18.6 in the same quarter of 2011. Earnings before interest, taxes, depreciation and amortization ("EBITDA") that is attributable to owners of the Company ("EBITDA to Owners") grew by $0.4 million or 4.9% to $8.6 million for the Quarter compared to $8.2 million for the same quarter in 2011. EBITDA to Owners margin rose by 0.7 percentage points to 46.9% from 46.2% in the Quarter compared to one year earlier. Furthermore, results for the Quarter are the best ever for the Company and the third consecutive quarter that we can repeat this phrase. That's a lot of good news in a sea of bad to be read almost daily in papers around the globe. Is it too good to last? No one can say for sure, but we don't know of a better region of the world we'd rather be.

Float Higher

$16.9 million of the Company's $55.0 million in convertible debentures have now converted to common shares with $8.9 million converting during the Quarter. The Company has issued 1.6 million shares to the converted debentures based on the $10.65/share strike price. By way of normal course issuer bid, the Company has been repurchasing shares on points of weakness. To date the company has repurchased and cancelled 0.7 million shares for a net increase in shares issued and outstanding of 0.9 million shares. Shares were repurchased by the Company at an average purchase price of $11.24/share and closed on August 2, 2012 at $12.55/share.

Money in the Pocket

Alberta continues to boast the highest employment rates and lowest unemployment rates in the country. All this means more Albertans with more jingle in their pockets. This is translating into improved consumer confidence and in our case more customers willing to spend on entertainment. We are optimistic that our properties will continue to benefit from this environment in the months ahead.

Certainly the occupancy performance at Service Plus hotel in Grande Prairie has been stronger than we had anticipated. This is a good indicator that energy sector activity in the area is continuing at a healthy level. This is supported by statistics released recently reporting unemployment rates of only 4.5% in the city. Recent unemployment figures released for the Wood Buffalo region of Northern Alberta of 4.6% also bode well for the continued success of our Boomtown Casino in Fort McMurray.

Calgary has the 2nd lowest unemployment rate of all major cities in Canada. It should be no surprise that consumers there have been freer spending of late as well. Certainly performance at our Deerfoot Inn & Casino would support this view. Our flagship property is a full 8% higher in year over year revenue generation for the Period and July 2012 results at the property during the recent 100th Anniversary of the Calgary Exhibition & Stampede were excellent.

Stop, Go or Yield?

Gamehost shares have seen strong support throughout the Quarter as new investors continue to seek equities that provide a secure steady yield. It is our aim to continue to be a secure and stable option for you to place your investment.

Condensed consolidated interim statement of profit and comprehensive income
In Canadian dollars (unaudited) (unaudited)
six months ended June 30 three months ended June 30
2012 2011 2012 2011
Operating revenue $ 37,985,550 $ 35,419,484 $ 19,126,213 $ 18,618,677
Cost of sales
Other (18,957,629 ) (18,362,341 ) (9,524,859 ) (9,359,331 )
Depreciation (1,072,211 ) (1,176,642 ) (537,022 ) (591,283 )
(20,029,840 ) (19,538,983 ) (10,061,881 ) (9,950,614 )
Gross profit 17,955,710 15,880,501 9,064,332 8,668,063
Other income 118,460 111,383 60,648 60,958
Administrative expenses
Other (1,492,365 ) (1,573,765 ) (732,446 ) (760,694 )
Depreciation (1,135,464 ) (1,327,137 ) (567,732 ) (673,366 )
(2,627,829 ) (2,900,902 ) (1,300,178 ) (1,434,060 )
Profit from operating activities

15,446,341



13,090,982



7,824,802



7,294,961

Finance income 46,269 39,380 23,327 20,822
Finance costs (1,769,946 ) (2,828,215 ) 170,750 (1,407,496 )
Net finance costs (1,723,677 ) (2,788,835 ) 194,077 (1,386,674 )
Profit before income taxes 13,722,664 10,302,147 8,018,879 5,908,287
Income tax expense (2,370,113 ) (1,102,892 ) (854,835 ) (1,396,256 )
Profit and comprehensive income for the period
$

11,352,551


$

9,199,255


$

7,164,044


$

4,512,031

Profit and comprehensive income attributable to:











Owners of the Company $ 10,684,150 $ 8,635,079 $ 6,810,629 $ 4,182,967
Non-controlling interest 668,401 564,176 353,415 329,064
Profit and comprehensive income for the period
$

11,352,551


$

9,199,255


$

7,164,044


$

4,512,031

Earnings per share
Basic earnings per share $ 0.497 $ 0.409 $ 0.313 $ 0.198
Diluted earnings per share $ 0.451 $ 0.400 $ 0.243 $ 0.195

August Dividend

Gamehost has declared a cash dividend for the month of August 2012 of $0.0733 per common share. The dividend will be paid on September 14, 2012 to shareholders of record on August 31, 2012. The ex- dividend date is August 29, 2012.

This dividend is considered an "Eligible Dividend" and therefore, eligible for the enhanced gross-up and dividend tax credit available to shareholders.

This press release may contain forward-looking statements. Forward-looking statements may contain words such as "anticipates", "believes", "could", "expects", "indicates", "plans" or other similar expressions that suggest future outcomes or events. Use of these statements reflect reasonable assumptions made on the basis of management's current beliefs with information known by management at the time of writing. Many factors could cause actual results to differ from the results discussed in forward-looking statements. Actual results may not be consistent with these forward-looking statements.

Gamehost is a corporation established under the laws of the Province of Alberta. The Company's operations are all located in the Province of Alberta, Canada. Operations of the Company include the Boomtown Casino in Ft. McMurray, the Great Northern Casino, Service Plus Inns & Suites hotel and a strip mall all located in Grande Prairie. The Company also holds a 91% ownership position in Deerfoot Inn & Casino Inc. in Calgary.

These unaudited interim financial results include the accounts of Gamehost Inc. and its subsidiaries; however, they do not include all disclosures normally provided in annual consolidated financial statements and should be read in conjunction with the 2011 annual consolidated financial statements. Further, while the financial figures included in this preliminary interim results announcement have been computed in accordance with IFRS applicable to interim periods, this announcement does not contain sufficient information to constitute an interim financial report as that term is defined in International Accounting Standard ("IAS") 34, "Interim Financial Reporting". The company has published and filed an interim financial report that complies with IAS 34 for the interim period ended June 30, 2012. This report, along with historical financial reports can be found on the Company's website at www.gamehost.ca and will be filed in its entirety along with the Company's other continuous disclosure documents, when they are available, on SEDAR at www.sedar.com.

Gamehost common shares and convertible debentures trade on the Toronto Stock Exchange (TSX) under the symbols GH and GH.DB respectively.

Contact Information

  • Gamehost Inc.
    Craig M. Thomas
    (877) 703-4545
    (403) 340-0683 (FAX)

    Gamehost Inc.
    Darcy J. Will
    (877) 703-4545
    (403) 340-0683 (FAX)
    info@gamehost.ca
    www.gamehost.ca