Key performance indicators of the Group
| Q1 2017 | Q1 2016 | Q1 2015 | ||
| Revenue before gaming taxes | m€ | 51.5 | 48.9 | 41.9 |
| Gaming tax | m€ | -11.2 | -11.3 | -9.9 |
| Net revenue | m€ | 40.3 | 37.6 | 32.0 |
| Total net revenue and income | m€ | 40.3 | 37.9 | 32.1 |
| EBITDA | m€ | 9.8 | 9.0 | 8.8 |
| EBIT | m€ | 6.8 | 6.5 | 7.0 |
| Net profit | m€ | 5.6 | 5.5 | 5.8 |
| EBITDA margin | % | 24.4 | 23.8 | 27.5 |
| Operating margin | % | 16.8 | 17.3 | 21.8 |
| Net margin | % | 13.9 | 14.5 | 18.2 |
| Assets | m€ | 158.4 | 169.9 | 135.5 |
| Equity | m€ | 135.6 | 127.2 | 115.6 |
| ROE | % | 4.7 | 4.3 | 5.1 |
| ROA | % | 3.6 | 3.3 | 4.4 |
| Current ratio | times | 2.4 | 1.4 | 2.8 |
| Casinos at end of period | # | 120 | 124 | 96 |
| Casino floor area at end of period | m2 | 39,083 | 38,830 | 31,603 |
| Betting points at the end of period | # | 31 | 33 | 0 |
| Betting points floor area at end of period | m2 | 838 | 964 | 0 |
| Employees | # | 3,023 | 3,201 | 2,656 |
| Slot machines at end of period | # | 4,100 | 4,183 | 3,317 |
| Electronic roulette terminals at the end of period | # | 108 | 142 | 120 |
| Gaming tables at end of period | # | 167 | 183 | 171 |
| Tournament poker gaming tables at the end of period | # | 66 | 64 | 55 |
Key developments of the Group during Q1 of 2017:
- The financial results in the management report section of this report have been presented together with discontinued operations Poland and Belarus, whereas in the statement of comprehensive income the results of discontinued operations have been separated and presented in a single line. Please see page 13 for the income statements of continued and discontinued operations.
- The Group’s consolidated total revenue before gaming taxes for Q1 2017 amounted to EUR 51.5 million, up 5.3% or EUR 2.6 million y‑o‑y.
- Total gaming revenue before gaming taxes accounted for 91.3% (47,0 m€) and other revenues for 8.7% (4.5 m€) of the Group’s consolidated total sales revenues for Q1 2017. A year before the revenue split was 94.2% (46.1 m€) and 5.8% (2.8 m€), respectively.
- The Group’s consolidated EBITDA for Q1 2017 amounted to EUR 9.8 million, a growth of 9.6% from EUR 9.0 million a year before. The Group’s consolidated operating profit increased EUR 0.3 million (3.9%) to EUR 6.8 million.
- The Group’s consolidated net profit attributable to equity holders of the parent company for Q1 2017 totalled EUR 6.0 million compared to EUR 5.1 million a year ago.
- In the current financial statements, Polish and Belarus segments have been classified as discontinued operations, for which the net profit for Q1 2017 amounted to EUR 0 million (in Q1 2016 net profit of EUR 0 million).
- Group Polish subsidiary Casino Polonia-Wrocław sp. z o.o. that operated the flagship casino of OEG in Warsaw until September 2016 submitted to the court its bankruptcy petition on 2 January 2017.
- On 11 January 2017 Group has established and registered the company Olybet Malta Limited in Malta with share capital of EUR 5,000. Group owns through a subsidiary 100% of the shares of Olybet Malta Limited. The aim of establishing the subsidiary is to develop the legal platform for the expansion of OEG group's activities in the business of remote gambling.
- Group Polish subsidiaries Baina Investments sp. z o.o. and Silber Investments sp. z o.o. submitted to the court their bankruptcy petitions on 20 January 2017. These holding companies own shares in the OEG subsidiary Casino Polonia-Wrocław sp. z o.o.
- On 27 February 2017 Group announced that the Lithuanian subsidiary of OEG, UAB Orakulas will be demerged into two entities within the first half of this year. The aim of the demerger is to adjust the group structure by separating the technology platform of online operations and trading and risk management for sports betting services from the operational activities of the subsidiary. OEG will own 100% of the shares in both entities after the demerger.
- On 28 March 2017 Group initiated proceedings for delisting its shares from the main market of the Warsaw Stock Exchange.
The Group’s consolidated total revenue before gaming taxes by segments:
| ‘000€ | Q1 2017 | Q1 2016 | Change |
| Estonia | 12,399 | 9,530 | 30.1% |
| Latvia | 16,542 | 16,024 | 3.2% |
| Lithuania | 7,032 | 6,288 | 11.8% |
| Slovakia | 4,501 | 3,923 | 14.7% |
| Italy | 7,915 | 6,287 | 25.9% |
| Malta | 3,117 | 2,187 | 42.5% |
| Poland | 0 | 4,573 | -100.0% |
| Belarus | 0 | 122 | -100.0% |
| Total | 51,506 | 48,934 | 5.3% |
Number of casinos by segment:
| 31 March 2017 | 31 March 2016 | |
| Estonia | 24 | 24 |
| Latvia | 54 | 57 |
| Lithuania | 18 | 19 |
| Slovakia | 8 | 7 |
| Italy | 15 | 14 |
| Malta | 1 | 1 |
| Poland | 0 | 1 |
| Belarus | 0 | 1 |
| Total | 120 | 124 |
Overview by markets
Estonia
Total revenue before gaming taxes of Estonian segment for Q1 of 2017 amounted to EUR 12.4 million (+2.9 m€, +30.1%), EBITDA to EUR 1.4 million (+0.1 m€, +4.4%) and operating profit to EUR 0.6 million (-0.3 m€, -34.3%). Gaming revenue before gaming taxes increased 13.7% y-o-y amounting to EUR 10.3 million.
At the end of March 2017, there were 24 Olympic casinos with 988 slot machines, 38 electronic roulette terminals, 24 gaming tables and 24 poker tournament tables operating in Estonia. As at 31 March 2017 Estonian operations employed 720 people.
Latvia
Total revenue before gaming taxes of Latvian segment for Q1 of 2017 amounted to EUR 16.5 million (+0.5 m€, +3.2%), EBITDA to EUR 6.8 million (+0.0 m€, +0.2%) and operating profit to EUR 5.8 million (-0.1 m€, -2.1%). Gaming revenue before gaming taxes increased 2.8% y‑o‑y amounting to EUR 15.1 million.
At the end of March 2017, there were 54 Olympic casinos with 1,476 slot machines, 8 electronic roulette terminals, 24 gaming tables and 9 poker tournament tables operating in Latvia. As at 31 March 2017 Latvian operations employed 917 people.
Lithuania
Total revenue before gaming taxes of Lithuanian segment for Q1 of 2017 amounted to EUR 7.0 million (+0.7 m€, +11.8%), EBITDA to EUR 1.1 million (+0.6 m€, +115.4%) and operating profit to EUR 0.6 million (+0.5 m€, +503.3%). Gaming revenue before gaming taxes increased 13.6% y-o-y amounting to EUR 6.7 million.
At the end of March 2017, there were 18 Olympic casinos with 544 slot machines, 8 electronic roulette terminals, 56 gaming tables and 2 poker tournament tables and 31 betting shops operating in Lithuania. As at 31 March 2017 Lithuanian operations employed 774 people.
Slovakia
Total revenue before gaming taxes of Slovak segment for Q1 of 2017 amounted to EUR 4.5 million (+0.6 m€, +14.8%), EBITDA to EUR 0.5 million (+0.2 m€, +109.3%) and operating profit to EUR 0.2 million (+0.2 m€). Gaming revenue before gaming taxes increased 17.5% y-o-y amounting to EUR 4.0 million.
At the end of March 2017, there were 8 Olympic casinos with 268 slot machines, 36 electronic roulette terminals, 44 gaming tables and 21 poker tournament tables operating in Slovakia. As at 31 March 2017 Slovak operations employed 324 people.
Italy
Total revenue before gaming taxes of Italian segment for Q1 of 2017 amounted to EUR 7.9 million (+1.6 m€, +25.9%), EBITDA to EUR 0.6 million (+0.4 m€, +155.3%) and operating profit to EUR 0.4 million (+0.2 m€, +142.4%). Gaming revenue before gaming taxes increased 25.7% y-o-y amounting to EUR 7.8 million.
At the end of March 2017, there were 15 VLT slot casinos with 539 slot machines operating in Italy. As at 31 March 2017 Italian operations employed 88 people.
Malta
Total revenue before gaming taxes of Maltese segment for Q1 of 2017 amounted to EUR 3.1 million (+0.9 m€, +42.5%), EBITDA to EUR -0.6 million (-0.3 m€) and operating loss to EUR 0.8 million (-0.3 m€). Gaming revenue before gaming taxes increased 42.4% y-o-y amounting to EUR 3.1 million.
At the end of March 2017, there was 1 casino with 285 slot machines, 18 electronic roulette terminals, 19 gaming tables and 10 poker tournament tables operating in Malta. As at 31 March 2017 Maltese operations employed 203 people.
Financial position
As at 31 March 2017, the total assets of the Group amounted to EUR 158.4 million, down 6.8% or EUR 11.5 million compared to the same period a year ago.
Current assets totalled EUR 51.8 million or 32.7% of total assets, and non-current assets EUR 106.6 million or 67.3% of total assets. The liabilities amounted to EUR 22.8 million and equity to EUR 135.6 million. The largest liabilities included suppliers payables and advances (7.4 m€), tax liabilities (5.9 m€) and payables to employees (5.4 m€).
Investments
Within Q1 of 2017, the Group’s expenditures on property, plant and equipment totalled EUR 1.6 million (-7.2 m€, -81.8%), of which EUR 1.0 million was invested into construction and reconstruction of casinos and EUR 0.4 million into new gaming equipment. Q1 2016 also includes investments into the hotel construction, which is why Q1 2017 investments were lower.
Cash flows
Group’s Q1 2017 cash flows generated from operating activities amounted to EUR 10.1 million (-0.5 m€) and cash flows used in investing activities to EUR -2.5 million (+16.1 m€). Financing cash flows amounted to EUR -0.03 million (+4.9 m€). Net cash flows totalled EUR 7.6 million (+11.6 m€).
Staff
As at 31 March 2017 Group employed 3,023 people, down by 178 y-o-y mostly due to casinos´ closure in Poland and Belarus.
Within Q1 of 2017, total personnel expenses amounted to EUR 13.5 million (+0.6 m€, +4.8%). For Q1 of 2017, the members of the Management Board and Supervisory Board of all Group entities were paid remuneration and benefits including social security taxes in the amount of EUR 270 thousand (EUR 372 thousand for Q1 of 2016) and EUR 37 thousand (EUR 37 thousand for Q1 of 2016), respectively.
Consolidated statement of financial position
| (EUR thousands) | 31.03.2017 | 31.12.2016 | |
| ASSETS | |||
| Current assets | |||
| Cash and cash equivalents | 45,537 | 37,933 | |
| Financial investments | 100 | 99 | |
| Receivables and prepayments | 3,807 | 4,552 | |
| Prepaid income tax | 711 | 913 | |
| Inventories | 1,690 | 1,532 | |
| Total current assets | 51,845 | 45,029 | |
| Non-current assets | |||
| Deferred tax assets | 463 | 426 | |
| Financial investments | 5,037 | 4,988 | |
| Other long-term receivables and prepayments | 1,020 | 776 | |
| Investment property | 295 | 295 | |
| Property, plant and equipment | 49,943 | 51,250 | |
| Intangible assets | 49,810 | 49,932 | |
| Total non-current assets | 106,568 | 107,667 | |
| TOTAL ASSETS | 158,413 | 152,696 | |
| LIABILITIES AND EQUITY | |||
| Current liabilities | |||
| Trade and other payables | 19,999 | 19,806 | |
| Income tax payable | 260 | 292 | |
| Provisions | 1,134 | 1,329 | |
| Total current liabilities | 21,393 | 21,427 | |
| Non-current liabilities | |||
| Deferred tax liability | 698 | 693 | |
| Other long-term payables | 729 | 703 | |
| Total non-current liabilities | 1,427 | 1,396 | |
| TOTAL LIABILITIES | 22,820 | 22,823 | |
| EQUITY | |||
| Share capital | 60,716 | 60,716 | |
| Share premium | 258 | 258 | |
| Statutory reserve capital | 4,860 | 4,860 | |
| Other reserves | 605 | 538 | |
| Translation reserves | 11 | -26 | |
| Retained earnings | 63,835 | 57,825 | |
| Total equity attributable to equity holders of the parent | 130,285 | 124,171 | |
| Non-controlling interest | 5,308 | 5,702 | |
| TOTAL EQUITY | 135,593 | 129,873 | |
| TOTAL LIABILITIES AND EQUITY | 158,413 | 152,696 |
Consolidated statement of comprehensive income
Summary of the income statements of continued and discontinued operations is presented on page 13 of the report.
| (EUR thousands) | Q1 2017 | Q1 2016 | |||
| Continuing operations | |||||
| Gross gaming revenue | 47,028 | 41,464 | |||
| Other revenue | 4,478 | 2,775 | |||
| Total revenue before gaming taxes | 51,506 | 44,239 | |||
| Gaming taxes | -11,210 | -9,020 | |||
| Net revenue | 40,296 | 35,219 | |||
| Other income | 10 | 165 | |||
| Total net revenue and income | 40,306 | 35,384 | |||
| Cost of materials, goods and services | -1,462 | -1,066 | |||
| Other operating expenses | -15,512 | -13,311 | |||
| Staff costs | -13,448 | -12,056 | |||
| Depreciation, amortisation and impairment | -3,065 | -2,374 | |||
| Other expenses | -64 | -112 | |||
| Total operating expenses | -33,551 | -28,919 | |||
| Operating profit | 6,755 | 6,465 | |||
| Interest income | 4 | 14 | |||
| Interest expense | 0 | -1 | |||
| Foreign exchange losses | -8 | -8 | |||
| Other finance income and costs | 0 | -2 | |||
| Total finance income and costs | -4 | 3 | |||
| Profit before income tax | 6,751 | 6,468 | |||
| Income tax expense | -1,135 | -1,004 | |||
| Net profit for the period from continuing operations | 5,616 | 5,464 | |||
| Net profit for the period from discontinued operations | 0 | 0 | |||
| Net profit for the period | 5,616 | 5,464 | |||
| Attributable to equity holders of the parent company | 6,010 | 5,099 | |||
| Attributable to non-controlling interest | -394 | 365 | |||
| Other comprehensive income | |||||
| Items that may be subsequently reclassified to profit or loss | |||||
| Currency translation differences | 37 | 180 | |||
| Total comprehensive profit for the period | 5,653 | 5,644 | |||
| Attributable to equity holders of the parent company | 6,047 | 5,279 | |||
| Attributable to non-controlling interest | -394 | 365 | |||
| Basic earnings per share* | 4.0 | 3.4 | |||
| From continuing operations | 4.0 | 3.4 | |||
| From discontinuing operations | 0.0 | 0.0 | |||
| Diluted earnings per share* | 4.0 | 3.4 | |||
| From continuing operations | 4.0 | 3.4 | |||
| From discontinuing operations | 0.0 | 0.0 |
* euro cents
Madis Jääger
CEO
Olympic Entertainment Group AS
Tel + 372 667 1250
E-mail madis.jaager@oc.eu
http://www.olympic-casino.com
