RED DEER, ALBERTA--(Marketwired - March 8, 2016) - Management and Directors of Gamehost Inc. (the "Company") (TSX:GH) are pleased to present results for the three months ended December 31, 2015 (the "Quarter") and twelve months ended December 31, 2015 (the "Year").
Now and Then
Total operating revenues for the Quarter were down 11.8% to $19.4 million compared to $22.0 million in the same quarter of 2014. For the Year, operating revenues are down 7.5%. Earnings before interest, taxes, depreciation and amortization ("EBITDA") that is attributable to shareholders of the Company ("EBITDA to Shareholders") was down 18.8% to $7.8 million compared to $9.6 million in the same quarter of 2014. For the Year, EBITDA to Shareholders was lower by 13.6%. EBITDA to Shareholders margin declined 3.7 percentage points in the Quarter to 42.2% from 45.9% in year over year comparison. For the Year, EBITDA to Shareholders margin declined by 3.0 percentage points. 2015 results are compared to a backdrop of record high numbers for the Company in 2014.
Not By Guess and By Golly
Did we know that Alberta would elect an NDP government after 44 years of Progressive Conservative rule? Did we know the federal Conservatives would fall hard to the Liberals? Did we know oil prices would slide to the levels we are seeing today? No, to all of the above. What we did know, however, is not to get too far ahead of yourself. Be patient. And, always be prepared for unforeseen events. The financial crisis in 2008/09 reminded us of this and so we continued to manage the Company to be in the best possible position to withstand another such event. And here we are. We are not laying off hundreds of staff, we are not selling assets at distressed pricing and we are not paying dividends we cannot afford.
Share prices for the Company have been caught in the same undertow directly affecting the trading price of energy and energy service company players. The Company remained on the sidelines, preserving cash, instead of actively buying back shares under an approved normal course issuer bid. The current bid will expire in April 2016 and will be renewed.
There are more than a few companies out there that would like a balance sheet like ours. The Company's convertible debentures matured during the Year. Now, with a debt to EBITDA ratio less than 0.9 to 1, we are in a strong position to weather the storm and capitalize on opportunities as they may present. All of the debt we do hold carries a very low interest rate of bank prime +1.0%. The Company continued to pay tax liabilities from 2011 through the Year with the final amounts from allowable 2011 deferrals to be paid during 2016. Capital maintenance expenditures will be minimal in 2016 as the Company completed a two year refurbishment program on our hotels in 2015. So, we head into the new year with a balance sheet and assets that are in great shape and ready to meet all challenges head on.
Hard at it Every Day
Drawing on our years of experience, including more than one down cycle in the energy sector, management has prepared a forward plan that acknowledges the current realities and conservatively addresses the conditions that are likely to persist in the year ahead. The impact of this latest commodity slump hit each of our operations at different periods of time and with varying severity. As a result, the accuracy of our 2016 projections will be best assessed towards the end of Q1 2016. Though the Company does not face the same pressures as our corporate oil and gas counterparts, we are leaving no stone unturned as we examine ways to be ever efficient in our operations and more creative in pursuing revenues.
Alberta, we live here and work here. We know it for all its booms and busts, sunrises and hail stones. Our neighbours come from everywhere and now are friends. Alberta, great when things are rolling and still pretty good when times are tough, we're sticking it out right here. Thanks for staying with us.
Consolidated Statements of Comprehensive Income
| In Canadian dollars (millions except per share figures) |
(audited) |
|
(unaudited) |
|
| |
twelve months ended
December 31 |
|
three months ended
December 31 |
|
| |
2015 |
|
2014 |
|
2015 |
|
2014 |
|
| |
|
|
|
| Operating revenue |
$ |
77.4 |
|
$ |
83.7 |
|
$ |
19.4 |
|
$ |
22.0 |
|
| Cost of sales |
|
|
|
| |
Other |
|
(41.2 |
) |
|
(42.0 |
) |
|
(10.6 |
) |
|
(11.0 |
) |
| |
Depreciation |
|
(2.1 |
) |
|
(2.2 |
) |
|
(0.5 |
) |
|
(0.6 |
) |
| |
|
(43.3 |
) |
|
(44.2 |
) |
|
(11.1 |
) |
|
(11.6 |
) |
| Gross profit |
|
34.1 |
|
|
39.5 |
|
|
8.3 |
|
|
10.4 |
|
| |
|
|
|
| Other income |
|
0.1 |
|
|
0.2 |
|
|
- |
|
|
- |
|
| |
|
|
|
| Administrative expenses |
|
|
|
| |
Other |
|
(3.2 |
) |
|
(3.5 |
) |
|
(0.7 |
) |
|
(1.0 |
) |
| |
Depreciation |
|
(1.6 |
) |
|
(1.8 |
) |
|
(0.4 |
) |
|
(0.4 |
) |
| |
|
(4.8 |
) |
|
(5.3 |
) |
|
(1.1 |
) |
|
(1.4 |
) |
| Profit from operating activities |
|
29.4 |
|
|
34.4 |
|
|
7.2 |
|
|
9.0 |
|
| |
|
|
|
| Other (losses) |
|
- |
|
|
(0.1 |
) |
|
- |
|
|
(0.1 |
) |
| |
|
|
|
| Finance income |
|
0.1 |
|
|
0.1 |
|
|
- |
|
|
- |
|
| Finance costs |
|
(1.4 |
) |
|
(2.3 |
) |
|
(0.3 |
) |
|
(0.1 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Profit before income taxes |
|
28.1 |
|
|
32.1 |
|
|
6.9 |
|
|
8.8 |
|
| |
|
|
|
| Income tax expense |
|
(7.0 |
) |
|
(8.2 |
) |
|
(1.7 |
) |
|
(1.2 |
) |
| Profit |
|
21.1 |
|
|
23.9 |
|
|
5.2 |
|
|
7.6 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Profit attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Shareholders |
|
19.8 |
|
|
22.4 |
|
|
4.9 |
|
|
7.2 |
|
| |
Non-controlling interest |
|
1.3 |
|
|
1.5 |
|
|
0.3 |
|
|
0.4 |
|
| |
|
21.1 |
|
|
23.9 |
|
|
5.2 |
|
|
7.6 |
|
| |
|
| Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Basic |
$ |
0.82 |
|
$ |
0.95 |
|
$ |
0.20 |
|
$ |
0.30 |
|
| |
Fully diluted |
$ |
0.82 |
|
$ |
0.95 |
|
$ |
0.20 |
|
$ |
0.29 |
|
| |
|
| Weighted average number of common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Basic |
|
24.2 |
|
|
23.6 |
|
|
24.7 |
|
|
23.7 |
|
| |
Fully diluted |
|
24.2 |
|
|
24.8 |
|
|
24.7 |
|
|
24.9 |
|
Condensed Interim Consolidated Statements of Comprehensive Income
| In Canadian dollars (millions except per share figures) |
(unaudited) |
|
(unaudited) |
|
| |
nine months ended
September 30 |
|
three months ended
September 30 |
|
| |
2015 |
|
2014 |
|
2015 |
|
2014 |
|
| |
|
| Operating revenue |
$ |
57.9 |
|
$ |
61.8 |
|
$ |
18.8 |
|
$ |
20.2 |
|
| Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Other |
|
(30.6 |
) |
|
(31.1 |
) |
|
(9.7 |
) |
|
(10.1 |
) |
| |
Depreciation |
|
(1.6 |
) |
|
(1.6 |
) |
|
(0.6 |
) |
|
(0.5 |
) |
| |
|
| |
|
(32.2 |
) |
|
(32.7 |
) |
|
(10.3 |
) |
|
(10.6 |
) |
| Gross profit |
|
25.7 |
|
|
29.1 |
|
|
8.5 |
|
|
9.6 |
|
| |
|
| Other income |
|
0.1 |
|
|
0.2 |
|
|
- |
|
|
0.1 |
|
| |
|
| Administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Other |
|
(2.4 |
) |
|
(2.6 |
) |
|
(0.7 |
) |
|
(0.9 |
) |
| |
Depreciation |
|
(1.2 |
) |
|
(1.3 |
) |
|
(0.4 |
) |
|
(0.4 |
) |
| |
|
(3.6 |
) |
|
(3.9 |
) |
|
(1.1 |
) |
|
(1.3 |
) |
| Profit from operating activities |
|
22.2 |
|
|
25.4 |
|
|
7.4 |
|
|
8.4 |
|
| |
|
| Net finance costs |
|
(1.0 |
) |
|
(2.1 |
) |
|
(0.1 |
) |
|
(0.8 |
) |
| |
|
| Profit before income taxes |
|
21.2 |
|
|
23.3 |
|
|
7.3 |
|
|
7.6 |
|
| |
|
| Income tax expense |
|
(5.3 |
) |
|
(7.0 |
) |
|
(1.0 |
) |
|
(3.4 |
) |
| Profit |
|
15.9 |
|
|
16.3 |
|
|
6.3 |
|
|
4.2 |
|
| |
|
| |
|
| Profit attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Shareholders of the Company |
|
14.9 |
|
|
15.2 |
|
|
5.9 |
|
|
3.8 |
|
| |
Non-controlling interest |
|
1.0 |
|
|
1.1 |
|
|
0.4 |
|
|
0.4 |
|
| |
|
15.9 |
|
|
16.3 |
|
|
6.3 |
|
|
4.2 |
|
| |
|
| Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Basic |
$ |
0.62 |
|
$ |
0.64 |
|
$ |
0.24 |
|
$ |
0.16 |
|
| |
Fully diluted |
$ |
0.62 |
|
$ |
0.64 |
|
$ |
0.24 |
|
$ |
0.16 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average number of common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Basic |
|
24.0 |
|
|
23.6 |
|
|
24.5 |
|
|
23.8 |
|
| |
Fully diluted |
|
24.0 |
|
|
24.8 |
|
|
24.5 |
|
|
25.0 |
|
| |
|
| EBITDA to Shareholders |
$ |
31.8 |
|
$ |
36.8 |
|
$ |
7.8 |
|
$ |
9.6 |
|
| EBITDA to Shareholders % |
|
43.1 |
% |
|
46.1 |
% |
|
42.2 |
% |
|
45.9 |
% |
Gamehost has also declared a cash dividend for the month of March 2016 of $0.0733 per common share. The dividend will be paid on April 15, 2016 to shareholders of record on March 31, 2016. The ex-dividend date is March 29, 2016.
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 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.
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 2015 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, 2016. 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.
