The Intertain Group Limited
TSX : IT

The Intertain Group Limited

March 09, 2015 16:27 ET

Intertain Group Limited Announces Fourth Quarter and Fiscal 2014 Financial Results

TORONTO, ONTARIO--(Marketwired - March 9, 2015) - The Intertain Group Limited ("Intertain" or the "Company") (TSX:IT) today announced its financial results for the three month period and year ended December 31, 2014. All amounts are stated in Canadian dollars unless otherwise noted.

Financial Highlights:

YE 2014 YE 2013 Q4 F14 Q4 F13
$ $ $ $
Revenue 40,776,239 - 18,281,704 -
Adjusted EBITDA (1) 20,062,593 (26,130) 7,626,643 (26,130)
Adjusted net income (2) 16,563,821 (107,700) 6,211,431 (107,700)
Basic adjusted net income per share $0.93 ($0.09) $0.25 ($0.09)
Diluted adjusted net income per share $0.80 ($0.09) $0.22 ($0.09)
(1) Adjusted EBITDA, as defined by the Company means income before financing costs (net of interest income and including a fair value adjusted for contingent consideration), income taxes, share-based compensation, amortization, loss on foreign exchange, and acquisitions related costs. Adjusted EBITDA is a non-IFRS measure. Reconciliation to Net Loss is included in this release.
(2) Adjusted net income as defined by the Company means income before share-based compensation, amortization of intangible assets resulting from purchase price allocation followings acquisitions, loss on foreign exchange, acquisition related costs, interest accretion, and the fair value adjustment for contingent consideration. Adjusted net income is a non-IFRS measure. Reconciliation to Net Loss is included in this release.

Q4 and Subsequent Highlights:

  • Completed the Acquisition of Dumarca Holdings Limited ("Vera&John") for EUR44.5 Million
    • Vera&John is a leading, fully integrated global online casino and operates in 13 countries worldwide and offers approximately 800 games and has approximately 490,000 registered customers.
    • The transaction was funded through a combination of cash-on-hand, a vendor take-back loan, and an interim bridge loan provided by certain members of Intertain management on an arm's length basis.
    • For the 3 months ended December 31st, 2014, Vera&John generated approximately EUR10.3 million in revenue and approximately EUR2.1 million in EBIT.
  • Announced Binding Agreement to Acquire Business-to-Consumer Assets from Gamesys Limited for £369 Million in Cash, 7.4 Million in Intertain Common Shares Plus an Earn Out
    • Privately held Gamesys Limited is the leading online bingo led business and owner and operator of the Jackpotjoy, Starspins and Botemania brands (the "Jackpotjoy Business").
    • The initial purchase price will consist of cash and share consideration worth approximately £425.8 million, plus certain cash earn out payments.
    • For the 3 months ended December 31st 2014, the JackpotJoy Businesess generated approximately £34 million in revenue and approximately £18 million in EBIT.
  • Completed Equity Funding of $483 Million
    • Intertain closed an offering of 32,200,000 subscription receipts, which were issued at a price of $15.00 per Subscription Receipt for aggregate gross proceeds of $483 million.
    • The Subscription Receipts began trading on the Toronto Stock Exchange under the symbol "IT.R" on February 26, 2015.
  • Signed Committed Debt of US$352.5 Million
    • Intertain entered into a binding commitment letter with Macquarie Capital (USA) Inc. in respect of certain credit facilities (the "Credit Facilities").
    • The Credit Facilities will consist of a seven-year US$335.0 million term loan credit facility and a five-year senior secured US$17.5 million revolving credit facility to be used for working capital and general corporate purposes.

"2014 was an extremely busy year for Intertain and I'm very pleased with our trading position and the overall progress we achieved," said John Kennedy FitzGerald, President and CEO of Intertain. "We owe our 2014 results to the ongoing successful implementation of our organic and acquisitive strategy on the road to becoming the world's largest online gaming operator focused on the female demographic. I am especially satisfied with Intertain's position as one of the largest online gaming companies with the highest percentage of revenue from regulated jurisdictions."

"2015 comes with great opportunity for Intertain, as we announced the acquisition of the Jackpotjoy, Starspins and Botemania brands from Gamesys and entered into a long-term partnership with them to launch the business globally. This is an historic period for our company and I feel privileged to be at the helm as we create something truly special."

Adjusted EBITDA & Adjusted Net Income for Year Ended December 31, 2014

YE 2014 YE 2013 Q4 2014 Q4 2013
Net loss for the period (26,067,946) (1,003,239) (12,044,986) (1,003,239)
Financing costs, net 7,937,157 81,570 5,089,060 81,570
Income taxes 381,934 - 89,871 -
Amortization 14,831,041 - 4,187,133 -
EBITDA (2,917,814) (921,669) (2,678,922) (921,669)
Loss on foreign exchange 2,084,053 - 1,193,022 -
Share-based compensation 1,116,537 - 253,901 -
Acquisition related costs 19,779,817 895,539 8,858,642 895,539
Adjusted EBITDA 20,062,593 (26,130) 7,626,643 (26,130)
Net loss for the period (26,067,946) (1,003,239) (12,044,986) (1,003,239)
Share-based compensation 1,116,537 - 253,901 -
Amortization of acquisition related purchase price intangibles 14,778,217 - 4,154,738 -
Loss on foreign exchange 2,084,053 - 1,193,022 -
Acquisition related costs 19,779,817 895,539 8,858,642 895,539
Interest accretion 1,492,003 - 414,974 -
Fair value adjustment for contingent consideration 3,381,140 - 3,381,140 -
Adjusted Net Income 16,563,821 (107,700) 6,211,431 (107,700)

2014 Fourth Quarter Financial Statements and Management's Discussion and Analysis

The financial statements, notes to the financial statements and Management's Discussion and Analysis for the three month period and year ended December 31, 2014, will be available on the SEDAR website at www.sedar.com.

Fourth Quarter and Fiscal 2014 Conference Call

Intertain will host a conference call with members of the investment community to discuss its fourth quarter and fiscal 2014 results on Monday, March 9, 2015 at 6:00 p.m. ET.

To participate, interested parties are asked to dial (647) 788-4919 or (877) 291-4570 10 minutes prior to the scheduled start of the call. A replay of the conference call will be available until March 23, 2015 by dialing (800) 585-8367 or (416) 621-4642 and using reference number 1491565.

About The Intertain Group Limited

Intertain is an online gaming company that provides entertainment to a global consumer base. Intertain currently offers bingo and casino to its customers using the InterCasino www.intercasino.com, Costa www.costabingo.com, Vera&John www.verajohn.com and other brands. For more about Intertain please visit www.intertain.com.

Disclaimer in Regards to Forward-Looking Statements

Certain statements included herein, including those that express management's expectations or estimates of our future performance constitute "forward-looking statements" within the meaning of applicable securities laws. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward-looking statements. Except as required by law, the Company does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events. Additional information identifying risks and uncertainties is contained in Intertain's filings with the Canadian securities regulators, available at www.sedar.com.

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