Positive effect on results attributable to Internet gaming
Swedish land, maritime and online gaming group, Cherryföretagen AB, released its third quarter interim report.
– Group turnover increased 56.3 percent and amounted to SEK 111.6 million (Q3/2009: SEK 71.4 million).
– EBITDA increased 153.2 percent to SEK 11.9 million (Q3/2009: SEK 4.7 million). EBIT amounted to SEK 9.1 million (Q3/2009: SEK 1.8 million).
– Profit after financial items amounted to SEK 7.9 million (Q3/2009: SEK 1.6 million) and third quarter results rose to SEK 7.6 million (Q3/2009: SEK 1.3 million) equivalent SEK 0.63 (Q3/2009: SEK 0.30) per share after minority interests.
– The number of registered customers within business segment Online Gaming amounted, on September 30, to 82 378 (Q2/2010: 74 884). The number of new customers during the period amounted to 7 494, an increase of 7.9 percent compared to Q2/2010. The number of active clients rose by 5.5 percent, to 14 320 customers (Q2/2010: 13 574). Deposits in Q3 amounted to SEK 133.8 million (Q2/2010: SEK 131.3 million).
– Cherry has in Q3/2010 increased the number of restaurant casinos in Sweden and further signed 7 new restaurant casino agreements with Harrys in Malmö, Tre Kockar in Kungälv and Kinna Krog etc.
– Cherry has in Q3/2010 renewed the contract with Unity Line for an additional five years. The contract covers Unity Lines four vessels.
President and Chief Executive Officer, Gunnar Lind comments:
From having been a traditional gaming company, in Cherry's case including Restaurant & Event Casino and Maritime Gaming, through the acquisition of AutomatGruppen, Cherry is now a more complete company in the gaming and entertainment industry.
Internet gaming is now an important and significant part of Cherry's activities and the organization in Malta is now a natural part of Cherry. The fact that Internet gaming is a significant part of Cherry's operations has had a positive effect on our results. Indicating a positive development, as a result of the acquisition, it has now become interesting to compare the results from previous years but taking into consideration that Cherry cannot, for the first quarter, include the results from AutomatGruppen. Our new employees continue to deliver the results we expected and that we based our purchase price on. I also experience and expect to see many exciting ideas for the future.
Even if we have concentrated a lot on AutomatGruppen, we have not lost focus on other business areas. Restaurant & Event Casino continues to deliver strong results and also shows growth. A substantial amount of the growth derives from the acquisition of Joker Casino in 2009, but also the fact that Cherry has increased the number of gaming clients. I am pleased that an important part of Cherry's vision, to promote the fun and excitement of gaming, despite an outdated and outmoded regulatory framework, continued to maintain profitability at a satisfactory level. We continue to develop our operations in Restaurant & Event Casino and will reduce the number of regions from three to two. We have also installed a new cash register system where our customers can pay with credit cards at all venues, which of course is timely.
Our Maritime activities are struggling with shrinking volumes and reduced on board gaming. A hard job is done to find ways to streamline the operations in order to reduce costs. In 2009 as well as in the beginning of 2010, a number of changes were made, which we expect will pay off when the economy recovers. I would like to repeat that Cherry has a positive long-term view on Maritime Gaming. We have, during the period, prolonged the contract with one of our major partners, which in turn indicate that the shipping industry has a positive view for the future and that gaming will continue to be a natural part of the travel experience.
The 2010 election in Sweden is completed. It will be interesting to see if the gaming legalization, once again, will be put on the agenda. Cherry has still not yet received a reply to our proposal to increase the stakes in restaurant casino – but who knows, maybe the answer arrives soon!