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Cherry year-end report 2018

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Cherry year-end report 2018Reading Time: 6 minutes

 

An eventful year with continued good development in the final quarter

 

FOURTH QUARTER

• Consolidated revenue increased by 49 percent to MSEK 904 (608), with organic revenue growth amounting to 41 percentage points. Corporate acquisitions contributed 0.5 percentage point and currency 7.5 percentage points.
• Profitability improved and EBITDA increased by 40 percent to MSEK 198 (141) and the EBITDA margin was 22 percent (23).
• Profit for the period amounted to MSEK 120 (18).
• Earnings per share before and after dilution amounted to SEK 1.14 (0.05) and SEK 1.14 (0.05) respectively.
• European Entertainment Intressenter BidCo AB (“EE Intressenter”), a company jointly controlled by a consortium of Bridgepoint and major shareholders in Cherry AB, announced a takeover bid for SEK 87 in cash per Class A and B share in Cherry AB. The independent bid committee for Cherry recommended that shareholders accept the public offer.
• Companies in the Online Gaming business area secured a total of eight Swedish gaming licenses in December.
• An Extraordinary General Meeting in November elected Rolf Åkerlind as a new member of the Board and approved the decision to acquire the remaining five percent of the shares in Game Lounge Sweden AB.

FULL-YEAR

• Consolidated revenue increased by 44 percent to MSEK 3,236 (2,252), of which organic growth amounted to 3 percent. Corporate acquisitions contributed 1 percentage point and currency 8 percentage points.
• Profitability improved and EBITDA increased by 89 percent to MSEK 813 (429) and the EBITDA margin was 25 percent (19).
• Profit for the period amounted to MSEK 487 (110). Profit was affected positively by an item affecting comparability of MSEK 50 regarding the reassessment of the value of Highlight Games.
• Earnings per share before and after dilution amounted to SEK 4.45 (0.53) and SEK 4.44 (0.53) respectively.
• As for the 2017 financial year, Cherry AB’s Board of Directors proposes to the Annual General Meeting that no dividend be paid for the 2018 financial year.

EVENTS AFTER THE END OF THE PERIOD

• On 12 February, EE intressenter announced that it controls approximately 98.2 percent of the total number of shares in Cherry AB (publ) after the expiry of the final acceptance period, and that EE Intressenter intends to initiate a compulsory acquisition procedure and to promote a delisting of the shares of series B in Cherry AB from Nasdaq Stockholm.
• On 12 February, Cherry announced the initiation of early redemption of senior secured callable bonds. In connection with the redemption, the bonds will be delisted from Nasdaq Stockholm.

Comments by the CEO

An excellent year for all companies in the Cherry Group

Cherry’s development in 2018 can be summarized with one word: excellent. On almost all measurements, our operations delivered in line with our expectations. Financially, we have performed well with total growth of 44 percent, and full-year revenue amounting to MSEK 3,236 (2,252) with an EBITDA margin of 25 percent (19).

For a significant part of the year, we worked to prepare for the re-regulation of the Swedish gaming market. We were involved right from the inquiry phase prior to the legislation being drafted and have participated in issues on which we have specialist knowledge on an ongoing basis. We are satisfied with the framework, which should contribute to a high level of channelization, which is important for the long-term perspective that our market needs to be able to develop in a way that assures all stakeholders the security they need.

It is reasonable that gaming companies be taxed and, to some extent, controlled when it comes to marketing, but the legislators must be aware that this is an industry in which customers are aware of their options and can therefore quickly shift their preferences. This can result in tax revenue and preventive actions from game addiction being lost. The more laws there are and the more detailed the regulations, the greater the risk that companies position themselves outside the licensing system, with the effect that everyone loses.

We now have only a few weeks’ experience of the Swedish regulations and it is too early yet to have a clear idea of how development is progressing for Cherry and the rest of the industry. Our experience of similar changes in other countries is that the companies and brands that cope best are those with a clear digital strategy, that are at the forefront in technology and their customer relationships, and are led by entrepreneurs. This is the core of Cherry’s business model and the companies within our Group hold strong positions, are strongly focused on what they do and are quick to grasp opportunities.

Marketing investments are often in focus among investors. During the quarter, business area Online Gaming accounted for the largest share, MSEK 253, and we can see that these investments continued to yield good returns. The business area’s revenue for the fourth quarter rose by 48 percent, to MSEK 722 (485) and the EBITDA result amounted to MSEK 141 (92). During the quarter, expenses affecting the comparison between periods were incurred, relating to doubtful receivables and gaming tax of MSEK 45.2, and impacting earnings. Underlying EBITDA amounted to MSEK 186.7 and the underlying EBITDA margin was 25.9 percent.

A few days ago, the ICE trade fair closed. This is one of the industry’s foremost meeting places, and Yggdrasil once again held a prominent position there as the leading game developer. Its attendance at ICE is the company’s largest initiative in presenting itself and its new games. For the third consecutive year, Yggdrasil received the industry’s “Innovator of the year” award.

The other company in business area Game Development, Highlight Games, has now launched its virtual football game in Italy together with some of the country’s largest gaming operators, Eurobet and Sisal. We believe that this game can quickly capture market share in one of Europe’s foremost football nations.

On 18 December 2018, European Entertainment Intressenter BidCo AB (“EE Intressenter”), announced a public cash offer of SEK 87 per share to Cherry AB shareholders. EE Intressenter is a company jointly controlled by a consortium consisting of Bridgepoint Advisers Limited, acting as manager for and on behalf of, Bridgepoint Europe VI Fund, major shareholders in Cherry AB and others.

The Board of Directors’ independent bid committee recommended that Cherry’s shareholders accept the bid from EE Intressenter. In its assessment, the recommendation took into account factors including the thorough analysis performed by the company’s financial advisers Carnegie. Key components of the bid committee’s assessment were the consideration of the bid premium over an extended time frame, the major shareholders’ decision to participate and changed market environments for listed gaming companies in Sweden.

On 25 January 2019, EE Intressenter announced that the offering was accepted by shareholders holding 45,425,416 shares, corresponding to approximately 43.0 percent of the shares in Cherry. The shares submitted in the offering, together with the shares controlled by the Consortium, totalled 4,988,000 Class A shares and 90,537,784 Class B shares in Cherry, corresponding to approximately 90.4 percent of the total number of shares and 93.3 percent of the total number of votes in Cherry AB. EE Intressenter extended the acceptance deadline to 8 February and announced on 12 February that it had secured approximately 98.2 percent of the total number of shares in Cherry. EE Intressenter intends to initiate a compulsory acquisition procedure regarding the shares in Cherry that were not tendered in the offer and to promote a delisting of the shares of series B in Cherry from Nasdaq Stockholm, the operations will continue in a private setting.

In a way, Cherry can be said to be Sweden’s oldest gaming company. The Group’s roots date back to 1963, when Bill Lindwall and Rolf Lundström initiated gaming operations under the name Restaurang AB Rouletter. In 1968, cooperation was initiated with AB Roulett konsult & Spelautomater, which had been founded Per Hamberg and Lars Kling. In 1972, the name of the company was changed to Cherry, and the cherry symbol began to be used as a trademark. The period as a listed company began in 1997, with the company’s listing on the SBI list, and after the current planned delisting of the company’s series B shares from Nasdaq Stockholm, Mid Cap list, to continue the business in a private setting.

The foundation of Cherry’s development has been, and remains, to have a clear focus on entrepreneurial spirit and innovation, as well as offering the best workplace and development opportunities for all of our employees. We will now work with partly new owners to implement the existing strategy, while, at the same time, being able to implement efficient investments to safeguard Cherry’s market position.

I would like to thank all of the shareholders, employees, partners and other stakeholders who have participated in Cherry’s journey thus far. I am convinced that Cherry and its Group companies will remain significant players in the gaming and entertainment industry for many years to come and I look forward to following developments.

Gunnar Lind
Acting CEO

 

MARKET OUTLOOK
The gaming market is currently growing strongly and Cherry estimates that demand in the Group’s largest geographic markets will continue to develop favourably. The Group continuously studies conditions for new business in related business areas and geographic markets within Europe and beyond.

The Group focuses on generating value for shareholders by participating actively in the development of new and existing companies in the gaming, media and entertainment sector. The objective is for the companies to become market leaders in their respective areas by building on their core values of entrepreneurship, responsibility and commitment. These are important prerequisites for the Group to be able to achieve its financial targets and to continue its successful profitable growth, through both organic growth and acquisitions, in existing and new verticals and geographic markets.


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Cherry year-end report 2018

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50 flavors of Endorphina at London event in 2019

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When it comes to international exhibitions there are certain exhibiting companies that immediately catch attendee´s attention with their promo. As usually, Endorphina was one of these companies during the main igaming event of the year – ICE London.

What was Endorphina´s booth all about then?

This time, Endorphina wasn´t playing any games and brought in a guest star from the US – Erik Cavanaugh, who has already won the hearts of millions with his passion for dancing and challenging stereotypes of a dancer’s body. Erik’s been viewed over 90 million times worldwide and his fame is still rising. His videos and interviews were published by major publications like People Magazine, The Today Show, Good Morning America, Forbes, and more. During each performance there was a crowd watching Erik, cheering and admiring his graceful moves. Trust us, it was an impeccable performance!

We had a chance to ask Erik about his feelings regarding the event:

“I am so excited to be performing with Endorphina at ICE London and getting to show to the attendees that Dancers Come In All Sizes! This is my first time ever performing live in Europe and I couldn’t be more excited!”

Endorphina´s stand was buzzing all the time. Many people came to try their luck in Wheel of Fortune to win a huge collection of prizes – from witty branded cans, a very own Endorphina cookbook or custom Endorphina slides and branded socks. Provider´s slides and socks with designs of successful game titles were the most popular prizes and made more than one attendee of the show come back to their stand for a second chance to win it. And the rest was exploring provider´s latest games and business opportunities.

Did you witness the guy who impressed America with his charm and talent at the show? Or did you win some of the branded goods? Let us know!

 

Learn more about Endorphina: https://endorphina.com/about


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: 50 flavors of Endorphina at London event in 2019

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Battle for Humanity’s Survival in Pariplay’s New Zombies Gone Wild Video Slot

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Battle for Humanity’s Survival in Pariplay’s New Zombies Gone Wild Video SlotReading Time: 2 minutes

 

iGaming software provider pits zombie hunters against the undead in this action-packed offering

 

Pariplay Ltd., a gaming technology company serving iGaming operators, land-based casinos and lotteries, has released Zombies Gone Wild, an original online video slot inspired by pop culture’s deep-rooted fascination with the living dead. Engaging characters, an atmospheric soundtrack and an array of exciting gameplay features, will have players of all experience players feeling like they are part of humanity’s last stand for survival.

Pariplay’s Zombies Gone Wild features 50 lines that pay both ways for even bigger rewards as well as a collection of wilds, free spins and jackpots. Ratcheting up the adrenaline pumping action are the expanding Mega Wilds, which occur when one of the game’s three heroic zombie hunters are exposed to radiation and become Wild zombies. During the ensuing free spins, the hunter expands to increase the chances of winning.

The game also features three jackpots, each of which corresponds to one of the three zombie hunters. Players can contribute to the value of these respective jackpots with a winning line that includes a Wild zombie hunter symbol. The jackpot values are tracked with separate progress bars, which when full award multipliers of x25, x75 or x200 of the bet amount, respectively.

Other game highlights include the free spins feature, which awards up to 20 spins and can be retriggered up to three times with the initial number of spins awarded. Offered in over 20 languages, Zombies Gone Wild appeals to a broad audience with its thrilling combination of vile zombie hordes and formidable heroes, that latter of which wield a skateboard, katana and chainsaw as their respective weapons of choice.

Zombies Gone Wild also benefits players with an attractive 95.88% return-to-player (RTP) rate, while its development in HTML5 supports gameplay across mobile phones, desktops and other devices. The game also features a mobile portrait mode, allowing players to easily switch to one-handed gameplay.

Certified by gambling regulators in the UK, Isle of Man and Malta, the slot is the latest addition to Pariplay’s growing portfolio of over 100 online casino games. Alongside its original and branded slot titles, the company also provides a selection of online scratch cards, bingo games and instant win titles.

Richard Mintz, Commercial and Marketing Director at Pariplay, said: “When designing Zombies Gone Wild, we knew it was important to give players a game that not only looked great but was also true to the spirit of a genre that holds such an important place in modern pop culture. That combined with our commitment to maximum entertainment, engagement and unique gameplay features, ensures that players of all experience levels will be eager to return to a world packed with rewards and adventure.”

For more information about the Zombies Gone Wild slot launch, contact Pariplay.


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Battle for Humanity’s Survival in Pariplay’s New Zombies Gone Wild Video Slot

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Pennsylvania Gaming Control Board Reports January Fantasy Contests Revenue

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Pennsylvania Gaming Control Board Reports January Fantasy Contests RevenueReading Time: 2 minutes

 

The Pennsylvania Gaming Control Board posted on its web site the January Fantasy Contests Revenue Report. The report provides a breakdown on fees collected from the play of Pennsylvania participants, Fantasy Contests Operators’ adjusted revenue, and tax revenue due to the Commonwealth. The report can be found at www.gamingcontrolboard.pa.gov.

Fantasy adjusted revenue for January was $2,116,499 compared to adjusted revenue of $2,860,503 in December 2018.

Tax revenue is derived through a 15% assessment on the adjusted revenue reported by the Fantasy Contest Operators and is deposited into the Commonwealth General Fund. This resulted in tax revenue generated during January of $317,475. Seven of the Fantasy Contest Operators reported tax revenue due.

Fantasy revenue and tax revenue for each of the providers for January 2019 is displayed in the following table:

Fantasy Contest Provider

January 2019

Fantasy Contest

Adjusted Revenue

January 2019

State Tax Due

DraftKings

$1,026,565.22

$153,984.78

FanDuel

$998,218.08

$149,732.71

Yahoo Fantasy Sports

$41,878.21

$6,281.73

DRAFT

$35,986.44

$5,397.97

Sportshub Technologies

$8,795.00

$1,319.00

Fantasy Draft

$4,201.20

$630.18

Boom Fantasy

$854.78

$128.22

Total

$2,116,498.93

$317,474.59

 

About the Pennsylvania Gaming Control Board:

The Pennsylvania Gaming Control Board is tasked to oversee all aspects of the state’s casino industry, including sports wagering offered currently at six locations. The oversight also includes other new gaming initiatives, expected to be launched in the coming months, which were created through Act 42 of 2017, an amendment to the Race Horse Development and Gaming Act.

The Commonwealth’s casino industry currently consists of 10 stand-alone and racetrack casinos in operation, along with the two smaller resort casinos.  These facilities collectively employ nearly 17,000 people and annually generate approximately $1.4 billion in tax revenue from slot machine and table games play. The largest portion of that money is used for property tax reduction to Pennsylvania homeowners.

Additional information about both the PGCB’s gaming regulatory efforts and Pennsylvania’s gaming industry can be found at gamingcontrolboard.pa.gov. You can also follow the agency on Twitter by choosing @PAGamingControl.

Source: Pennsylvania Gaming Control Board


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Pennsylvania Gaming Control Board Reports January Fantasy Contests Revenue

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