Gamehost Inc.
Tuesday, March 13, 2018 - 6:40 PM EDT

Gamehost Announces Fourth Quarter 2017 Financial Results and March Dividend



Red Deer, Alberta (FSCwire) - Management and Directors of Gamehost Inc. (the “Company”) present results for the three and twelve months ended December 31, 2017 (the "Quarter" and "Year" respectively).

 

This Quarter is the first since Q2 2016 without the distortion of comparative results caused by the 2016 Fort McMurray area wildfire.  The fire resulted in our Boomtown Casino closing for ten weeks beginning in May 2016, followed by the recording of intermittent insurance settlements from our insurer.  This Quarter is also the first quarter since Q4 2014 that we can celebrate normal year-over-year improvements in top line revenue generation and EBITDA.  This has been a protracted recession which we hope has come to an end for the Company.

 

Profit attributable to shareholders for the Quarter was up $0.1 million or 2.3% to $4.5 million compared to $4.4 million in the same quarter of 2016.  Earnings per share was flat to the prior year quarter at $0.18 per common share.

 

Total operating revenues for the Quarter were up $0.3 million or 1.7% to $17.7 million compared to $17.4 million in the same quarter of 2016.  Earnings before interest, taxes, depreciation, and amortization (“EBITDA”) that is attributable to shareholders of the Company ("EBITDA to Shareholders") was up $0.4 million or 6.0% to $7.1 million compared to $6.7 million in the same quarter of 2016.  EBITDA to Shareholders margin for the Quarter improved to 42.0% from 40.4% in year-over-year comparison.

 

Though top line and EBITDA consolidated results were both positive for the Quarter, operating results geographically were mixed.

 

Fort McMurray continues to feel the lingering fallout from the effects of the 2016 wild fire.  Significant populations in the city remain displaced with less than one third of destroyed residences reconstructed for occupancy.  It is still unclear what portion of the former permanent population will ultimately return to the community following completion of rebuilding efforts, which are expected to take an additional three to four years.  Top line and EBITDA results in Fort McMurray were lower for the Quarter compared to one year earlier by 4.8% and 10.5% respectively.

 

Grande Prairie continues to be the beacon of light for the Company.  Great Northern Casino and Service Plus combined results for top line and EBITDA produced year-over-year growth for the Quarter of 15.1% and 16.9% respectively.  The community continues to benefit from the Montney and Duvernay geological formations that remain attractive for energy sector investment.

 

At the Company's Deerfoot property, management has made impressive strides at finding operating efficiencies that were implemented in the previous quarter.  While top line results for the Quarter were flat in year-over-year comparison, an impressive 12.7% improvement in EBITDA over the same period mirrored similar results in the previous quarter. 

 

The Company's dividend pay-out ratio has fallen steadily from the start of the year to 89.4% for the Quarter.  Total debt was reduced by 1.3 million during the Quarter and 4.0 million during the Year.  Debt as a percentage of EBITDA is now 0.9 to 1.  The Company is well positioned to capitalize on opportunities as they may arise and to easily withstand a rising interest rate environment should it emerge.  Since the start of the new year, the Company has purchased for cancellation, 169,350 common shares at prices averaging $10.26 per common share including commissions.  Up to this point, the Company had not been active on our current normal course issuer bid given the lack of any real forward clarity in the economy.  The Company acquired a parcel of land separating our Great Northern Casino and Service Plus hotel in Grande Prairie.  The parcel will provide for additional parking and expansion potential for the two properties. 

 

Three years into what has been one of the most severe recessions experienced in the province, we are now beginning to see some positive signs that, if sustained, could mean we are at the end of this dark tunnel.  Oil prices have seen a positive trend upward since the beginning of August of this year and broke through $60 per barrel at the beginning of December of this year.  The Company's fortunes are closely tied to the strength of this commodity and the jobs and economic spin offs it provides.

 

Gamehost Inc.

           

Financial Highlights

           

Unaudited - Canadian dollars (millions except per share figures)

   
   

twelve months ended December 31

three months ended December 31

   

2017

2016

 % Chg

2017

2016

 % Chg

               

Operating revenue

$68.2

$67.3

1.3%

$17.7

$17.4

1.7%

Cost of sales

           
 

Other

(37.2)

(37.3)

 

(9.6)

(9.7)

 
 

Depreciation

(1.8)

(2.0)

 

(0.4)

(0.5)

 
   

(39.0)

(39.3)

 

(10.0)

(10.2)

 

Gross profit

29.2

28.0

4.3%

7.7

7.2

6.9%

               

Other income

0.2

1.8

 

-

-

 
               

Administrative expenses

           
 

Other

(3.0)

(3.1)

 

(0.7)

(0.7)

 
 

Depreciation

(1.3)

(1.4)

 

(0.3)

(0.4)

 
   

(4.3)

(4.5)

 

(1.0)

(1.1)

 

Profit from operating activities

25.1

25.3

(0.8%)

6.7

6.1

9.8%

               

Net finance costs

(1.1)

(1.0)

 

(0.2)

(0.3)

 
               

Income tax expense

(6.2)

(7.0)

 

(1.7)

(1.2)

 

Profit

 

17.8

17.3

2.9%

4.8

4.6

4.3%

               

Profit attributable to:

           
 

Shareholders

16.7

16.2

3.1%

4.5

4.4

2.3%

 

Non-controlling interest

1.1

1.1

 

0.3

0.2

 
   

17.8

17.3

 

4.8

4.6

 
               

Earnings per share

           

Basic and fully diluted

$0.68

$0.66

 

$0.18

$0.18

 
               

Weighted average number of common shares outstanding

   

Basic

 

24.7

24.7

 

24.7

24.7

 

Fully diluted

24.7

24.7

 

24.7

24.7

 
               

EBITDA to Shareholders

$27.0

$27.6

(2.2%)

$7.1

$6.7

6.0%

EBITDA to Shareholders %

41.5%

41.4%

 

42.0%

40.4%

 

 

             
               

Cash

 

14.6

14.7

(0.7%)

     

Total assets

164.1

166.7

(1.6%)

     

Total debt

25.8

29.8

(13.4%)

     

 

Gamehost has also declared a cash dividend for the month of March 2018 of $0.0575 per common share.  The dividend will be paid on April 13, 2018 to shareholders of record on March 31, 2018.  The ex-dividend date is March 28, 2018.

 

This dividend is considered an “Eligible Dividend”, qualifying for the enhanced gross-up and dividend tax credit available to shareholders.

 

This press release may contain certain "forward-looking information" or statements within the meaning of applicable securities legislation and may contain words such as “anticipates”, “believes”, “could”, “expects”, “indicates”, “plans”, “withstand”, “further” or other similar expressions that suggest future outcomes or events.  Forward-looking information is based on the Company's current expectations, estimates, projections and assumptions that were made by the Company in light of its historical trends and other factors.  All information or statements, other than statements of historical fact, are forward-looking information including any statements that address expectations related to future economic outcomes or the Company’s dividend.  Forward-looking 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.

 

The Company has included non-International Financial Reporting Standards (“non-IFRS”) measures in this press release.  EBITDA to Shareholders, as defined by the Company, means earnings before interest and financing costs, income taxes, depreciation and amortization, and foreign exchange gain.  The Company believes EBITDA is a useful measure because it provides information to management and investors about the Company’s performance in generating operating cash flow to fund working capital needs, service debt obligations, fund future capital expenditures and support dividend policy.  Readers are cautioned that non-IFRS measures do not have any standardized meaning prescribed by IFRS and should not be taken as alternatives to net earnings measured in accordance with IFRS.  The Company’s method of calculating non-IFRS measures may not be comparable to similarly titled measures used by other reporting entities.  Dividend pay-out ratio, means EBITDA less all scheduled principal payments on debt, interest expense, and income tax expense.  The Company believes this measure to be useful to management and investors because it provides insight into the sustainability of the Company’s dividend.

 

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 consolidated 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 2017 annual consolidated financial statements. Further, while the financial figures included in this announcement have been computed in accordance with IFRS applicable to annual periods, this announcement does not contain sufficient information to constitute an interim or annual financial report. The company will file an annual financial report for the three and twelve month period ended December 31, 2017.  This report will be filed in its entirety, along with historical financial reports on the Company’s website at www.gamehost.ca and on SEDAR at www.sedar.com along with the Company’s other continuous disclosure documents, when they are available.

 

Gamehost common shares trade on the Toronto Stock Exchange (TSX) under the symbol GH.

 

For more information, contact:

Craig M. Thomas or,

Darcy J. Will

P (877) 703-4545

F (403) 340-0683

E info@gamehost.ca







Source: Gamehost Inc. (TSX:GH, OTC Pink:GHIFF)

To follow Gamehost Inc. on your favorite social media platform or financial websites, please click on the icons below.


 

Maximum News Dissemination by FSCwire. https://www.fscwire.com

 
 

Copyright © 2018 FSCwire





Visit Company Profile Gamehost Inc.
Visit Company Website
Subscribe to This Company Sign Up