Gamehost Inc.
TSX : GH

Gamehost Inc.

March 30, 2012 13:33 ET

Gamehost Corrects Clerical Error in Monthly Dividend

RED DEER, ALBERTA--(Marketwire - March 30, 2012) - Gamehost Inc. (TSX:GH)

Gamehost's press release issued March 29, 2012 incorrectly stated that the Company would maintain a "$0.733 per share regular monthly dividend rate". The statement should read a $0.0733 per share regular monthly dividend rate. The full corrected press release is re-printed below:

GAMEHOST ANNOUNCES Q4 and ANNUAL FINANCIAL RESULTS FOR 2011

Management and Directors of Gamehost Inc. ("Gamehost", the "Company", the "Corporation", "Our") are pleased to present annual results for the twelve months ended December 31, 2011 (the "Period") and three months ended December 31, 2011 (the "Quarter").

It's been a while since we've been able to say "another record Quarter", but we can say it again for Q4 2011, our biggest quarter ever! Total operating revenues for the Quarter grew by 6.4% to $19.0 million from $17.8 in the same quarter of 2010. Earnings before interest, taxes, depreciation and amortization ("EBITDA") that is attributable to owners of the Company ("EBITDA to Owners") grew $0.6 million or 8.4% to $8.1 million for the Quarter compared to $7.4 million for the same quarter in 2010. EBITDA to Owners margin climbed by 0.8 percentage points to 42.6% from 41.8% in the Quarter compared to one year earlier. For the Period, in year over year comparisons, revenue is up 15.3% to $72.0 million from $62.5 million, EBITDA to Owners is up 13.0% to $30.6 million from $27.1 million while EBITDA to Owners margins are down 1.1 percentage points to 42.3% from 43.4%. The year over year reduction in Period EBITDA to Owners margin percentage can be attributed to the May 2010 acquisition of an additional 51% interest in the Deerfoot Inn & Casino which has higher operating costs than do the Company's other properties. We're hoping this is the sound of the starting gun for a quick out of the blocks sprint through 2012.

There's still a lot of ill health affecting the world's economies. Clear treatment plans for the European Union sovereign and financial credit markets have not yet emerged. A drug resistant bacterium continues to malady the United States economy, and unrest from the 'Arab spring' is affecting good circulation in middle eastern economies. Just a few of the names on the 'critical' list. Here in Alberta, there is significant optimism that things may be on the mend. So, forget about your winter holiday trip south. A trip west to Alberta might just be your best medicine.

During the year $5.2 million of the Company's debentures were presented for conversion to 490,879 common shares. Offsetting this increase to dividend paying shares, the Company repurchased for cancellation 495,140 shares at an average price of $11.00 per share resulting in zero dilution of the Company's per share earnings. We will endeavor to continue a program of share repurchase equal to the rate of debenture conversions in the coming year.

The Corporation, will make its first ever tax installments beginning January 2013. On June 26, 2011, a federal government Ways and Means Motion to limit tax deferral opportunities for corporations with interests in partnerships received royal assent. Consequently, a perpetual one year deferral of current year taxes will be closed at the end of 2012. The accretive cash flow from the 2010 acquisition of a further 51% interest in Deerfoot Inn & Casino will ensure tax obligations can be met while maintaining the Company's $0.0733 per share regular monthly dividend rate.

Management continued a program of facility refurbishment over the year, completing a number of projects in Grande Prairie and Calgary in order to maintain the high level of appearance and quality we know our customers appreciate.

Scheduled principal reductions on the Company's traditional debt together with debenture conversions continue to improve on already envious debt levels. The Company's total debt to EBITDA ratio sits at 2.4:1 at December 31, 2011.

During the year, and indeed since the onset of the 'Great Recession', management has worked diligently to keep costs in check. Repeatedly, over the course of this troubled period we made mention of the benefits of having to examine areas of cost that we had assumed were as efficient as they could be. Learning otherwise, we have made some permanent changes to our cost structure. Elimination of some administrative positions and offering and promoting fewer but higher quality live entertainment events to name a few examples.

At the date of writing, Gamehost shares are trading in a flat to moderately higher trend, at or near 52 week highs, which represents a 13.8% increase from the start of the 2011. We are optimistic that 2012 will continue to witness increased per capita spending by our customers and higher foot traffic through our doors. As it does, the home fires should burn brighter than ever before. We look forward again to days when we can report that we are truly 'on fire'!

Consolidated statement of profit (loss) and comprehensive income (loss)

In Canadian dollars (audited) (unaudited )
twelve months ended December 31 three months ended December 31
2011 2010 2011 2010
Operating revenue $ 71,989,151 $ 62,449,609 $ 18,957,496 $ 17,820,644
Cost of sales
Other (37,432,038 ) (31,524,933 ) (9,863,356 ) (9,405,924 )
Depreciation (2,355,818 ) (2,228,479 ) (591,336 ) (633,236 )
(39,787,856 ) (33,753,412 ) (10,454,692 ) (10,039,160 )
Gross profit 32,201,295 28,696,197 8,502,804 7,781,484
Other income 240,386 240,383 68,257 58,985
Administrative expenses
Other (2,959,443 ) (3,435,257 ) (750,388 ) (793,768 )
Depreciation (2,663,731 ) (1,446,991 ) (682,823 ) (700,927 )
(5,623,174 ) (4,882,248 ) (1,433,211 ) (1,494,695 )
Profit from operating activities 26,818,507 24,054,332 7,137,850 6,345,774
Other gains 1,677 27,083,015 1,677 -
Finance income 82,542 56,540 21,893 20,477
Finance costs (5,586,935 ) (12,581,717 ) (1,238,534 ) (3,526,685 )
Fair value changes to Class B limited partnership units - (23,336,000 ) - (9,241,056 )
Profit (loss) before income taxes 21,315,791 15,276,170 5,922,886 (6,401,490 )
Income tax expense (5,301,001 ) (564,272 ) (2,984,706 ) (851,091 )
Profit (loss) and comprehensive income (loss) for the period $ 16,014,790 $ 14,711,898 $ 2,938,180 $ (7,252,581 )
Profit (loss) and comprehensive income (loss) attributable to:
Owners of the Company $ 14,860,454 $ 13,942,116 $ 2,618,808 $ (7,533,019 )
Non-controlling interest 1,154,336 769,782 319,372 280,438
Profit (loss) and comprehensive income (loss) for the period $ 16,014,790 $ 14,711,898 $ 2,938,180 $ (7,252,581 )
Earnings per share
Basic and diluted earnings (loss) per share $ 0.702 $ 0.661 $ 0.123 $ (0.357 )

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.

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.

This press release is not a suitable source of information for readers who are unfamiliar with the Gamehost. Readers more familiar with the Company should not consider this press release a substitute for reading the financial statements and MD&A. Consolidated financial statements and MD&A, both current and historical, are available on the Company's website at www.gamehost.ca and will be filed in their 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.

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