Press Releases
Parlay Entertainment Announces Results Results for Q1 2009
OAKVILLE, ONTARIO — May 27, 2009
All amounts in Canadian Dollars
Parlay Entertainment Inc. (TSX VENTURE: PEI.V), the world's leading supplier of Internet and TV bingo software solutions, today announced its results for the three-month period ended March 31, 2009.
"2009 marks an important transitional year for Parlay as we deploy Parlay5 across our licensee base and provide enhanced technology solutions through our Parlay Games Services division in Alderney," said Mr. Scott White, Parlay's Chief Executive Officer. "With Parlay5 representing the most sophisticated and robust Internet bingo software commercially available today, our ability to support some 11 languages in a multi-currency environment, gives us a platform to service increasingly sophisticated licensees offering gaming opportunities across multiple languages and currencies."
"Through the use of this new generation of Parlay bingo," continued Mr. White, "our integration of new content from our recently announced technology partners, our launch of complete remote gaming services in the UK and North America and our enhanced customer relationships, as well as opportunities to use the Parlay5 platform outside of traditional Internet gaming, will give Parlay the ability to recoup the revenue streams divested in 2008."
Parlay generates revenue from software licensing, installation fees and support services. Consolidated revenues were $1.0 million in Q1 2009 compared to $2.0 million in Q1 2008.
Expenses in Q1 2009 were $1.3 million, down from $2.5 million in Q1 2008. The decrease represented reduced compensation expenses together with the absence of certain non-recurring expenses in Q1 2008.
Net loss for the quarter was $0.2 million, or $(0.02) per diluted share, compared to a net loss of $0.3 million, or $(0.02) per diluted share in Q1 2008.
Parlay remains debt free and Parlay's cash balance at March 31, 2009 was $3.0 million.
"As part of our strategic plan to transition Parlay out of non-regulated markets, we anticipated that both our revenue and our cost-base would shrink in Q1 2009," commented Mr. White. "With our strong cash position and solid technology infrastructure, we expect to end 2009 with increasingly robust revenue streams from customers on both sides of the Atlantic, while at the same time continuing to control our cost structure."
PARLAY ENTERTAINMENT INC.
CONSOLIDATED BALANCE SHEETS
(incorporated under the laws of the province of Ontario)
in whole Canadian dollars
(Unaudited) (Audited)
March 31, December 31,
ASSETS 2009 2008
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Current assets:
Cash $ 3,005,569 $ 3,226,615
Accounts receivable:
Trade, less allowance of approximately
$132,000 ($108,000 - 2008) 841,201 820,974
GST receivable 6,702 18,185
Prepaid expenses, deposits and other assets 108,127 184,075
Future income taxes 225,972 225,972
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Total current assets 4,187,571 4,475,821
Equipment - net 92,348 95,492
Future income taxes, net of valuation
allowance 60,000 60,000
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$ 4,339,919 $ 4,631,313
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 474,975 $ 555,492
Income taxes payable 103,772 59,819
Deferred revenue 305,303 280,364
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Total current liabilities 884,050 895,675
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Shareholders' equity:
Common shares, an unlimited number of
shares authorized, 12,375,765 shares
issued and outstanding (12,585,765 - 2008) 1,649,239 1,667,013
Contributed surplus 2,694,761 2,664,274
Accumulated other comprehensive income (loss) (356,615) (356,615)
Retained earnings (accumulated deficit) (531,516) (239,034)
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3,455,869 3,735,638
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$ 4,339,919 $ 4,631,313
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PARLAY ENTERTAINMENT INC.
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND RETAINED EARNINGS
(ACCUMULATED DEFICIT)
(in whole Canadian dollars, except for per share amounts)
Three-Months Ended
------------------
March 31
2009 2008
------------- -------------
(Unaudited) (Unaudited)
Revenues:
Royalties $ 849,938 $ 1,769,733
Installation fees 21,720 86,539
Software license fees - 62,654
Support services 148,398 107,347
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1,020,056 2,026,273
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Expenses:
Sales, marketing and services to licensees 140,625 236,215
Research, software development and support
services 806,737 1,220,698
General and administrative 335,018 418,318
Amortization 20,990 39,362
Foreign exchange (gain) (18,778) (6,210)
Transaction fees - 557,072
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1,284,592 2,465,455
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Income (loss) before income taxes (264,536) (439,182)
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Income tax provision (recovery)
Current (73,000) (137,342)
Future - -
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(73,000) (137,342)
------------- -------------
Net income (loss) for the period (191,536) (301,840)
Retained earnings (accumulated deficit),
beginning of period (239,034) (403,490)
Repurchase and cancellation of common shares (100,946) -
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Retained earnings (accumulated deficit),
end of period $ (531,516) $ (705,330)
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Net income (loss) per share:
Basic $ (0.02) $ (0.02)
------------- -------------
------------- -------------
Diluted $ (0.02) $ (0.02)
------------- -------------
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Weighted average number of common
shares outstanding:
Basic 12,400,432 13,237,265
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Diluted 12,400,432 13,237,265
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PARLAY ENTERTAINMENT INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in whole Canadian dollars, except for per share amounts)
Three-Months Ended
March 31
--------
2009 2008
------------- -------------
(Unaudited) (Unaudited)
Net income (loss) for the period $ (191,536) $ (301,840)
Changes in unrealized gains (losses) on
translating the comparative consolidated
financial statements of the Company for the
three-month period ended March 31, 2008 from
the $U.S. to the Canadian dollar following
the adoption of the Canadian dollar as the
functional and reporting currency on October
1, 2008 (net of income taxes of nil). - 120,389
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Comprehensive income (loss) for the period $ (191,536) $ (181,451)
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PARLAY ENTERTAINMENT INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in whole Canadian dollars)
Three-Months Ended
March 31
--------
2009 2008
------------- -------------
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net income (loss) for the period $ (191,536) $ (301,840)
Adjustments to reconcile net income (loss)
to net cash (used in) operating activities:
Stock option expense 30,487 35,318
Amortization 20,990 39,362
Changes in non-cash working capital items:
Accounts receivable (8,744) (470,167)
Prepaid expenses, deposits and other
assets 75,948 (52,225)
Accounts payable and accrued liabilities (96,442) (183,045)
Income taxes recoverable / payable 43,953 (137,021)
Deferred revenue 24,939 379,594
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Net cash (used in) operating activities (100,405) (690,024)
------------- -------------
Cash flows from investing activities:
Purchases of equipment (17,846) (1,312)
Increase in accounts payable and accrued
liabilities related to purchases of
equipment 5,974 -
------------- -------------
Net cash (used in) investing activities (11,872) (1,312)
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Cash flows from financing activities:
Repurchase of common shares (142,245) -
Increase in accounts payable and accruals
related to repurchase of common shares 9,950 -
------------- -------------
Cash used for repurchase of common shares (132,295) -
Proceeds from issuance of common shares 23,526 39,438
------------- -------------
Net cash provided by (used in) financing
activities (108,769) 39,438
------------- -------------
Effect of changes in foreign currency
exchange rates on cash - 58,136
------------- -------------
Net (decrease) in cash (221,046) (593,762)
Cash, beginning of period 3,226,615 1,810,375
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Cash, end of period $ 3,005,569 $ 1,216,613
------------- -------------
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Supplemental cash flow activities:
Income taxes paid $ 218,300 $ -
------------- -------------
------------- -------------
Income taxes (received) $ (335,253) $ -
------------- -------------
------------- -------------
Interest (received) $ (21,586) $ -
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(1) Management believes that EBITDA (earnings before interest, income taxes and amortization) is a useful supplemental measure of performance. However, EBITDA is not a recognized earnings measure under generally accepted accounting principles ("GAAP") and does not have a standardized meaning. Therefore, EBITDA may not be comparable to similar measures presented by other companies. EBITDA is reconciled to net income as follows:
Three-Months Ended
------------------
March 31,
2009 2008
------------- -------------
Net income (loss) $ (191,536) $ (301,840)
Interest (21,586) -
Taxes (73,000) (137,342)
Amortization 20,990 39,362
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EBITDA $ (265,132) $ (399,820)
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Revenue $ 1,020,056 $ 2,026,273
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% -26% -20%
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About Parlay Entertainment
Parlay Entertainment Inc. is the world's leading developer and licensor of Internet and TV bingo solutions. As the inventor and holder of Internet bingo² patents, Parlay was the first company in the world to develop and deploy a commercial Internet bingo product. Parlay Bingo is available in both 75-number, 80-number and 90-number versions and is complemented by a full suite of lottery and casino games. Our multi-player, multi-platform technology is used to power more online bingo sites than any other software provider in the world. Some of the world's best known brands use Parlay solutions, including Yahoo!, Paddy Power, NetPlay TV and the St. Minver, TGN and Entraction bingo networks. Parlay's head offices are in Oakville, Canada with offices in Bridgetown, Barbados, and Valletta, Malta.
Contact:
Scott F. White
Parlay Entertainment Inc.
President & CEO
+1 (905) 337-6505
David Callander
Parlay Entertainment Inc.
CFO
+1 (905) 337-6516
For more information on Parlay solutions and services, please visit our Web site at www.parlaygroup.com.
This document may contain statements about expected future events and/or financial and operating results of Parlay Entertainment Inc. that are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions and other forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements.
The TSX Venture Exchange does not accept any responsibility for the adequacy or accuracy of this release.
² United States Patent No. 6,585,590, Canadian Patents No. 2,340,152 and 2,618,843, with other Patent applications pending in other countries
© 2010 by Parlay Entertainment Inc.