Wednesday April 29,2015 : BIG FISH PERFORMS WELL FOR CHURCHILL DOWNS
New acquisition boosts casino results but related acquisition charges have an effect
American gaming firm Churchill Downs Inc (CDI) reported record net revenues in its first quarter 2015 results, saying its recent acquisition of Big Fish Games had performed beyond expectation.
Key performance indicators include:
Net revenues of $250.9 million, up 50 percent over first-quarter 2014
Record Adjusted EBITDA of $48.3 million, up 97 percent over first-quarter 2014
Record net cash from operating activities of $89.7 million, up 73 percent over first-quarter 2014
Net loss driven by $19.3 million of Big Fish Games acquisition related charges and deferred revenue adjustments
“Our Big Fish Games acquisition, completed late in the fourth-quarter, helped drive record first-quarter results and provided further validation of our strategy to enter the growing online and mobile games segment,” commented Bill Carstanjen, chief executive officer of CDI.
CDI’s other business segments reported “encouraging” results with Casino Adjusted EBITDA growing 6 percent; TwinSpires Adjusted EBITDA growing 12 percent; and Racing Adjusted EBITDA improving 10 percent.”
“The performance of our operating segments also drove a 73% improvement in cash provided by operating activities over prior year and, consequently, we reduced the Company’s total debt to approximately $700 million from $770 million at year end”, Carstanjen added.
Big Fish Games’ results account for around 45 percent of EBITDA while TwinSpires generated an increase in adjusted EBITDA of $1.2 million.
The acquisition of Big Fish Games has, however impacted CDI’s quarterly net loss and net loss per share figures below the adjusted EBITDA line.
CDI Online Business results for the first quarter of 2015 include:
Total bookings increased $29.8 million or 67 percent compared to the pre-acquisition of Big Fish Games.
Bookings for casino grew by $19.8 million.
Free-to-Play Casual increased by $21.3 million.
153 percent increase in quarterly average paying casino users.
Premium bookings declined $11.3 million, or 28 percent, primarily driven by customers continuing to shift from paid PC games to free-to-play mobile games.
Revenues decreased $0.8 million due to the cancellation of a third-party administrative call center service agreement during the fourth-quarter of 2014.
Wagering handle increased 1.1 percent compared to a U.S. thoroughbred racing handle decline of 5.2 percent, outpacing the industry by 6.3 percentage points.
Adjusted EBITDA increased $1.2 million.