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RED DEER, AB / ACCESSWIRE / November 14, 2023 / Gamehost Inc. (TSX:GH) Management and Directors of Gamehost Inc. (the "Company") present results for the nine and three months ended September 30, 2023 (the "Period" and "Quarter" respectively).
Operating revenue for the Quarter was up 18.3% to $21,392.6 thousand ($18,809.4 thousand - 2022) and EBITDA was up 53.0% to $9,459.7 thousand ($6,182.3 thousand - 2022). Earnings per share for the Quarter nearly doubled to $0.27 ($0.14 - 2022).
Comparative results for the Quarter reflect a two-percentage point increase in the operators share of electronic gaming device Hold from 15% to 17%. AGLC approved the temporary, two year, increase effective April 1, 2023. The increase is intended to incentivize operators to make investments in their facilities or promotions that will increase gaming revenues and will be evaluated at regular intervals by AGLC during the two-year period. Management is hopeful that results following the two-year period will support the change being made permanent.
All company assets reported year-over-year gains in revenue, cashflow and margins. Wildfires that in the prior quarter suppressed rooming revenue at our northern hotels in Grande Prairie by keeping oil & gas crews out the field were a boost to rooming revenues at all Company hotels during the Quarter from wildfire evacuees.
The Company applied $4,129.2 thousand to reduce debt during the Quarter and has reached a debt to EBITDA ratio of 1.5 to 1 on a trailing twelve-month basis.
Consumers in the province have proven to be very resilient to the headwinds of inflation and any negative sentiment towards a slowing economy. Provincial Cash Play numbers for slot machines entered record territory towards the end of the prior quarter and have since marched steadily higher. Very favourable in-migration to the province could be masking the true impact of inflation and higher interest rates and we expect at some point to feel their impact on revenue growth. In the meantime, we are enjoying the benefits Alberta is famous for and sharing positive news again after some difficult years.
Gamehost Inc.
Financial Highlights
Unaudited - Canadian dollars (thousands except per share figures)
| nine months ended September 30 | three months ended September 30 | |||||||||||||||||||||
| 2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||||||||||||
| Operating revenue | $ | 62,064.3 | $ | 50,959.7 | 21.8 | % | $ | 21,392.6 | $ | 18,089.4 | 18.3 | % | ||||||||||
| Cost of sales | ||||||||||||||||||||||
| Other | (33,459.1 | ) | (30,609.1 | ) | (11,227.7 | ) | (11,265.2 | ) | ||||||||||||||
| Depreciation | (2,545.8 | ) | (2,786.8 | ) | (857.2 | ) | (873.2 | ) | ||||||||||||||
| | (36,004.9 | ) | (33,395.9 | ) | (12,084.9 | ) | (12,138.4 | ) | ||||||||||||||
| Gross profit | 26,059.4 | 17,563.8 | 48.4 | % | 9,307.7 | 5,951.0 | 56.4 | % | ||||||||||||||
| | ||||||||||||||||||||||
| Lease and other income (expense) | 140.8 | (554.8 | ) | 54.9 | 40.8 | |||||||||||||||||
| | ||||||||||||||||||||||
| Administrative expenses | ||||||||||||||||||||||
| Other | (2,733.2 | ) | (2,292.0 | ) | (847.1 | ) | (730.4 | ) | ||||||||||||||
| Depreciation | (710.2 | ) | (733.2 | ) | (247.0 | ) | (244.5 | ) | ||||||||||||||
| | (3,443.4 | ) | (3,025.2 | ) | (1,094.1 | ) | (974.9 | ) | ||||||||||||||
| Profit from operating activities | 22,756.8 | 13,983.8 | 62.7 | % | 8,268.5 | 5,016.9 | 64.8 | % | ||||||||||||||
| | ||||||||||||||||||||||
| Net finance costs | (2,288.2 | ) | (1,706.7 | ) | (741.3 | ) | (703.9 | ) | ||||||||||||||
| Profit before income tax | 20,468.6 | 12,277.1 | 7,527.1 | 4,313.0 | ||||||||||||||||||
| | ||||||||||||||||||||||
| Income tax expense | (4,800.8 | ) | (3,587.4 | ) | (1,752.8 | ) | (1,230.7 | ) | ||||||||||||||
| Profit | 15,667.8 | 8,689.7 | 80.3 | % | 5,774.3 | 3,082.3 | 87.3 | % | ||||||||||||||
| | ||||||||||||||||||||||
| Profit attributable to: | ||||||||||||||||||||||
| Shareholders | 15,667.8 | 8,393.5 | 5,774.3 | 3,082.3 | ||||||||||||||||||
| Non-controlling interest | - | 296.2 | - | - | ||||||||||||||||||
| | 15,667.8 | 8,689.7 | 80.3 | % | 5,774.3 | 3,082.3 | 87.3 | % | ||||||||||||||
| | ||||||||||||||||||||||
| Earnings per share | ||||||||||||||||||||||
| Basic and fully diluted | $ | 0.72 | $ | 0.37 | 92.2 | % | $ | 0.27 | $ | 0.14 | 93.6 | % | ||||||||||
| | ||||||||||||||||||||||
| Weighted average number of common shares outstanding | ||||||||||||||||||||||
| Basic and fully diluted (x 000) | 21,875.2 | 22,526.5 | 21,706.5 | 22,433.1 | ||||||||||||||||||
| | ||||||||||||||||||||||
| EBITDA | $ | 26,255.9 | $ | 17,587.1 | 49.3 | % | $ | 9,459.7 | $ | 6,182.3 | 53.0 | % | ||||||||||
| EBITDA % | 42.0 | % | 34.8 | % | 43.9 | % | 34.0 | % | ||||||||||||||
| | ||||||||||||||||||||||
| | September 30, | December 31, | ||||||
| Cash | 15,452.6 | 15,614.5 | ||||||
| Total assets | 181,240.9 | 183,409.5 | ||||||
| Total debt | 47,292.8 | 54,502.2 | ||||||
Gamehost has declared a cash dividend for the month of November 2023 of $0.04 (CDN) per common share, which equates to $0.48 (CDN) per common share on an annualized basis. The dividend represents a 33.3% increase to the regular monthly dividend and will be paid on December 15, 2023 to shareholders of record on November 30, 2023. This dividend is considered an "Eligible Dividend" and therefore, eligible for the enhanced gross-up and dividend tax credit available to Canadian shareholders.