CryptoLogic Software Reports 'Transitional Year'

Wednesday March 25, 2009

Leading casino software developer CryptoLogic Limited has released its financial figures for 2008 showing a 16.5 percent drop in revenues to $61.526 million.

The Dublin-based firm reported that its results reflected a transitional year in which a new management team put in place last February endeavoured to reposition the business following a fundamental review.

CryptoLogic unveiled a new growth strategy and restructuring programme in October featuring a renewed focus on customer acquisition. As a result, the firm signed ten new customers over 2008 including 888 Holdings Plc, PartyGaming Plc, BSkyB Group Plc and GigaMedia while releasing 34 new games featuring brands such as Street Fighter II, Sub-Mariner and King Kong. The developer stated that this strategy, which is now in an advanced stage of execution, would help it to achieve long-term growth, sustained profitability and strong cash generation.

For the final quarter of 2008, CryptoLogic revealed revenues of $11.4 million, which was a 44 percent drop from the same period in 2007, while reporting a net loss of $26 million from profits of $4.3 million a year earlier due to the write downs of some of its assets and programme costs alongside non-recurring restructuring costs, departure costs for its ex-Chief Executive Officer and currency fluctuations.

For the future, CryptoLogic stated that it is on track to achieve its full-year targets for 2009 providing that there is no further deterioration in economic conditions and currency markets stabilise. If these targets were met, CryptoLogic would emerge from 2009 with net income of around nine million dollars, eight million dollars in revenues from 2008 customer signings and full-year cash generation post-restructuring of just under $13 million.

"In the fourth quarter, we unveiled a bold strategy to refocus CryptoLogic on its core strengths and on a return to profitability in 2009," said Brian Hadfield, President and Chief Executive Officer for CryptoLogic.

"Our restructuring programme is ahead of schedule. With a lower cost base, ten new customers signed to date and a highly profitable 'build-once-license-often' model coupled with the financial strength to weather difficult global economic conditions, CryptoLogic is on track for a substantial turnaround this year."