Asia-facing online and land gambling group AsianLogic Limited has reported a 49 percent fall in adjusted pretax profit for 2008, following a significant increase in operational expenses and bad debt provisions. The company showed a 2008 pretax loss of $11.9 million. The Board has therefore decided that a dividend will not be paid.
Vice Chairman Tom Hall said to counter the fall in adjusted profits AsianLogic was repositioning the business by looking to dispose of its wholesale-based gaming services and investing further in higher-margin deposit and retail-based products.
"The increasing pressure on our lower margin wholesale business profitability, and increasing bad debt provision meant the company's adjusted net profit nearly halved," Hall said. "To counter this, the board is repositioning the business by looking to dispose of its wholesale business and invest further into higher margin deposit and retail based products as well as services, and again, we expect revenues to continue to grow.”
"However, the capital expenditure, marketing and advertising spend required to grow this business means that profitability will be impacted throughout 2009 and into 2010", he added.
AsianLogic's adjusted pretax profit for the year ended December 31, 2008 almost halved to $6.3 million from $12.4 million last year.
Revenue increased by a creditable 82 percent to $98.7 million, but the company's operating expenses soared to $6.9 million from $2.8 million a year ago, while financial expenses also surged to $17.9 million from $500 000.
Daily casino turnover rose 83 percent to $11.5 million from $6.2 million in 2007, and average daily poker rake increased 4.5 times from a low base to $15 000 from $2 700 the year before. The company had a net cash balance at 31 December 2008 of $ 48.6 million.
The firm reported a 2008 pretax loss of $11.9 million against a profit of $7.9 million last year. Shares fell 20 percent.