Philippines – Entertainment Gaming Asia readjusting following sales

Having sold off its assets related to the gaming products operations and all its gaming assets in Cambodia, Entertainment Asia Gaming has posted revenue from continuing operations of $357,000 for the fourth quarter and $2mfor the 2016 fiscal year.

This left the company with revenue from its continuing operations in the Philippines.

Consolidated revenue for the fourth quarter was down 47 per cent compared to $676,000 in the fourth quarter of 2015. Consolidated revenue of $2m for the 2016 fiscal year, was down 26 per cent compared to $2.6m in the prior year.

The company said the decreases were due to a reduced operating base of electronic gaming machines (EGMs) as a result of the expiration of the EGM leasing agreement with Leisure World VIP Slot Club on June 30, 2016 and lower average daily net win per unit due to increased competition.

It reported a net loss of $9.7m for the 2016 fiscal year compared to income of $820,000 for 2015 fiscal year. The 2016 fiscal year net loss included a net loss of $4.4m from the discontinued gaming products and Cambodia gaming operations. The 2015 fiscal year net income included net income of $4.8 million from the same discontinued operations.

The increases in net losses from continuing operations were primarily due to lower gaming operations revenue, higher operating expenses (mainly related to the social gaming operations) and higher taxes due to an income tax provision and movement in the deferred tax assets for the Philippines operations. This was partially offset by lower depreciation and amortization expenses related to the gaming operations.

Clarence Chung, Chairman and Chief Executive Officer of Entertainment Gaming Asia, said: “During 2016, we disposed of all of our gaming assets in Cambodia, certain gaming assets in the Philippines and the principal assets of the gaming products business. These sales have provided cash proceeds of $10.3m and the potential for earn-outs on certain gaming chip and plaque sales related to the now discontinued gaming products business. To date, we have received $8.1m of the sales proceeds and no earn-outs on gaming chip and plaque sales.

Our reduced base of operations coupled with the expenses related to the social gaming operations, which remain in the testing phase, and corporate overhead, presently have a negative impact on our cash flow. We currently have approximately $32m in cash and are exploring avenues to apply these resources in ways to enhance value for our shareholders.”

 

Source http://www.g3newswire.com/philippines-entertainment-gaming-asia-readjusting-following-sales/