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RED DEER, AB / ACCESSWIRE / August 10, 2021 / Gamehost Inc. (TSX:GH) Management and Directors of Gamehost Inc. (the "Company") present results for the six and three month periods ended June 30, 2021 (the "Period" and "Quarter" respectively).
In year-over-year comparison for the Quarter, operating revenue was up 61.1% from $1.8 to $2.9, EBITDA swung to a positive $0.8 from a loss in the prior year quarter. A net loss per share for the Quarter of $0.02 per share was reduced from $0.06 per share for the same quarter in 2020.
Two of the Company's three casinos reopened in June 2021 when milestones were reached for Stage 2 of the Government of Alberta's ("GOA") "Open for Summer" economic reopening plan. Stage 2 allowed for all gaming activities at one third of fire code capacity and a resumption of indoor dining to a maximum of six per table with a continuation of mask use and physical distancing measures. Great Northern Casino in Grande Prairie opened June 10, 2021 for 21 operating days in the Quarter. Deerfoot Casino delayed reopening to June 18, 2021 to accommodate ongoing construction and operated for 13 days in the Quarter. The Company's three hotels were open throughout the Quarter continuing to operate under restrictions that limit service to appointment only check-in and COVID-19 protocols for breakfast and dining room service.
The province reached infection and hospitalization targets as well as the required days between stages for Stage 3 of the GOA reopening plan on July 1, 2021, Canada Day. On that day, all COVID-19 restrictions were removed, and all Company operations resumed full operations with the following notable exceptions. Boomtown Casino delayed reopening to accommodate ongoing construction activity. It reopened July 6, 2021 as the rebranded Rivers Casino & Entertainment Centre coinciding with a first inside look for patrons at the major expansion project underway. Dining and live entertainment venues within the casino remain closed and gaming capacity is reduced while construction progresses. A second construction project progressing at Deerfoot Casino is temporarily reducing slot and table capacity and poker is not currently offered. The casino's showroom, cafe and pub also remain closed. Management is pleased with the activity levels at all Company casinos in the short period since reopening. Gaming activity has been robust and would likely be even stronger if full food services were available.
It is clear that a high level of demand accumulated during the six or so months of full closure. The sustainability of this higher demand will be dependant on a number of factors. The full lifting of remaining travel restrictions which is forcing residents to spend their money at home and the comfort citizens feel towards resuming all of their pre-pandemic activities. In the meantime, the Company is again generating strong positive cash flow.
The Company has been focused on completing expansion projects at both Deerfoot Casino and Rivers Casino & Entertainment Centre. Original budgets on both projects will be exceeded by approximately 10% and completion dates extended by a couple of months into late-summer and mid-fall respectively. Management is enthused about what both of these projects, once completed, will contribute to the excitement and draw to both properties and the expected return on investment.
During the Quarter the Company repurchased 155,700 shares for an aggregate $1.2. The normal course issuer bid expired on July 20, 2021 after the Company acquired a total 917,565 shares at an average $6.11 per share or total $5.6. The Company received approval for a new normal course issuer bid commencing July 21, 2021 allowing the Company to purchase up to 1.2 million of its common shares. The Company will continue to purchase shares under issuer bid when Management believes the trading price of the Company shares do not adequately reflect underlying value.
The Company's dividend remains temporarily suspended. A decision to reinstate the dividend in whole or in part is reviewed at regular intervals by the board of directors. In the next months the Company will be focused on completing construction projects and rebuilding working capital balances until confidence that full and sustained recovery in operations is reasonably assured.
At June 30, 2021, the Company had a cash balance of $15.0 and $4.0 in available revolving credit. Management has been in discussions with our lender regarding covenant requirements. Our lender has temporarily waived certain covenants which will be evaluated at the end of the calendar year through their annual diligence review. Additional liquidity, if required, has been assured.
We are excited for the return of our valued employees who have weathered a difficult period both health wise and financially. And we welcome back our long-missed patrons to a clean, safe and fun environment. Even though it is no longer mandatory, we will proceed cautiously and continue to encourage mask use, hand sanitizing and physical distancing which has proven to dramatically reduce the potential spread of COVID-19 and other known viruses.
Gamehost Inc.
Financial Highlights
Unaudited - Canadian dollars (millions except per share figures)
six months ended June 30 | three months ended June 30 | |||
2021 | 2020 | 2021 | 2020 | |
| Operating revenue | $ 4.0 | $ 15.7 | $ 2.9 | $ 1.8 |
| Cost of sales | ||||
Other | (5.1) | (10.8) | (2.9) | (2.5) |
Depreciation | (1.4) | (1.5) | (0.7) | (0.8) |
(6.5) | (12.3) | (3.6) | (3.3) | |
| Gross profit (loss) | (2.5) | 3.4 | (0.7) | (1.5) |
| Lease and other income | 2.6 | 0.5 | 1.3 | 0.4 |
| Administrative expenses | ||||
Other | (0.8) | (1.1) | (0.5) | (0.4) |
Depreciation | (0.5) | (0.6) | (0.3) | (0.3) |
(1.3) | (1.7) | (0.8) | (0.7) | |
| Profit (loss) from operating activities | (1.2) | 2.2 | (0.2) | (1.8) |
| Fair value adjustment | - | (0.6) | - | - |
| Net finance costs | (0.8) | (0.8) | (0.3) | (0.4) |
| Profit (loss) before income tax | (2.0) | 0.8 | (0.5) | (2.2) |
| Income tax (expense) recovery | 0.5 | (0.1) | 0.1 | 0.6 |
| Profit (loss) | (1.5) | 0.7 | (0.4) | (1.6) |
| Profit (loss) attributable to: | ||||
Shareholders | (1.4) | 0.6 | (0.4) | (1.5) |
Non-controlling interest | (0.1) | 0.1 | - | (0.1) |
(1.5) | 0.7 | (0.4) | (1.6) | |
| Earnings (loss) per share | ||||
| Basic and fully diluted | $ (0.06) | $ 0.02 | $ (0.02) | $ (0.06) |
| Weighted average number of common shares outstanding | ||||
| Basic and fully diluted | 23.2 | 24.1 | 23.1 | 24.0 |
| EBITDA to Shareholders | $ 0.7 | $ 4.2 | $ 0.8 | $ (0.1) |
| EBITDA to Shareholders % | 10.9% | 27.1% | 19.5% | (4.8%) |
June 30, 2021 | December 31, 2020 | |||
| Cash | 15.0 | 10.3 | ||
| Total assets | 180.7 | 175.0 | ||
| Total debt | 50.0 | 40.8 | ||
This press release may contain certain "forward-looking information" or statements within the meaning of applicable securities legislation and may contain words such as "anticipates", "believes", "could", "expects", "indicates", "plans", "withstand", "further" or other similar expressions that suggest future outcomes or events. Forward-looking information is based on the Company's current expectations, estimates, projections and assumptions that were made by the Company in light of its historical trends and other factors. All information or statements, other than statements of historical fact, are forward-looking information including any statements that address expectations related to future economic outcomes or the Company's dividend. Forward-looking statements reflect reasonable assumptions made on the basis of management's current beliefs with information known by management at the time of writing. Many factors could cause actual results to differ from the results discussed in forward-looking statements. Actual results may not be consistent with these forward-looking statements.
The Company has included non-International Financial Reporting Standards ("non-IFRS") measures in this press release. EBITDA to Shareholders, as defined by the Company, means earnings before interest and financing costs, income taxes, depreciation and amortization, and foreign exchange gain. The Company believes EBITDA is a useful measure because it provides information to management and investors about the Company's performance in generating operating cash flow to fund working capital needs, service debt obligations, fund future capital expenditures and support dividend policy. Readers are cautioned that non-IFRS measures do not have any standardized meaning prescribed by IFRS and should not be taken as alternatives to net earnings measured in accordance with IFRS. The Company's method of calculating non-IFRS measures may not be comparable to similarly titled measures used by other reporting entities.
Gamehost is a corporation established under the laws of the Province of Alberta. The Company's operations are all located in the Province of Alberta, Canada. Operations of the Company include the Rivers Casino & Entertainment Centre in Ft. McMurray, the Great Northern Casino, Service Plus Inns & Suites hotel, Encore Suites hotel and a strip mall all located in Grande Prairie. The Company also holds a 91% ownership position in Deerfoot Inn & Casino Inc. in Calgary.
These condensed interim consolidated financial results include the accounts of Gamehost Inc. and its subsidiaries; however, they do not include all disclosures normally provided in annual consolidated financial statements and should be read in conjunction with the 2020 annual consolidated financial statements. Further, while the financial figures included in this announcement have been computed in accordance with IFRS applicable to annual periods, this announcement does not contain sufficient information to constitute an interim or annual financial report. The company will file an interim financial report for the six and three months ended June 30, 2021. This report will be filed in its entirety, along with historical financial reports on the Company's website at www.gamehost.ca and on SEDAR at www.sedar.com along with the Company's other continuous disclosure documents, when they are available.
Gamehost common shares trade on the Toronto Stock Exchange (TSX) under the symbol GH. For more information, contact:
Craig M. Thomas or Darcy J. Will
P (877) 703-4545
F (403) 340-0683
E info@gamehost.ca
SOURCE: Gamehost Inc.
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