TORONTO, May 31, 2018 (GLOBE NEWSWIRE) -- Tangelo Games Corp. ("Tangelo" or the "Company") (TSX-V:GEL) reports its financial results for the first quarter of 2018 (the three-month period ended March 31, 2018).
| in $000,000 Canadian Dollars except for shares and per share amounts | ||||||||
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| 2018 | 2017 | |||||||
| REVENUE | 8.62 | 8.99 | ||||||
| Adjusted EBITDA* | 1.83 | 2.43 | ||||||
| Due diligence and transaction costs, Severance and restructure costs, Depreciation of equipment, Amortization of intangibles and Stock-based compensation | 2.94 | 3.01 | ||||||
| OPERATING (LOSS) | (1.11 | ) | (0.57 | ) | ||||
| OTHER CHARGES | ||||||||
| Interest and accretion, Changes in value of long-term debt, Foreign exchange | 5.83 | 4.18 | ||||||
| LOSS, CONTINUING OPERATIONS, BEFORE INCOME TAX | (6.94 | ) | (4.75 | ) | ||||
| NET LOSS, CONTINUING OPERATIONS | (6.60 | ) | (4.29 | ) | ||||
| NET INCOME/(LOSS), DISCONTINUED OPERATIONS | 0.00 | 0.01 | ||||||
| TOTAL NET LOSS FOR THE PERIOD | (6.60 | ) | (4.28 | ) | ||||
| Basic and diluted loss per share, continuing operations | $ | (0.04 | ) | $ | (0.02 | ) | ||
| Basic and diluted income/(loss) per share, discontinued operations | $ | 0.00 | $ | 0.00 | ||||
| Weighted average number of shares: basic and diluted | 184,288,880 | 180,668,880 | ||||||
| * See Non-IFRS Measures | ||||||||
Tangelo Q1 results can be found on its website (www.tangelo.com) or SEDAR (www.sedar.com).
James Lanthier, Chief Executive Officer of Tangelo, commented:
“In the first quarter of 2018, Tangelo’s revenue declined slightly from the immediately prior quarter by 2% to $8.62M but was actually up on an average revenue per day basis given that the first quarter is a shorter quarter.
Monthly average paying users were approximately 52,000 for the first quarter. Paying users for Tangelo Israel grew year over year and were up by 18% in the first quarter of 2018 from the year before, with the majority of this growth coming through reactivating former customers from the Company’s large database of historical customers.
The Company’s net loss grew from (4.28) M in the first quarter of 2017 to (6.60) M in the first quarter of 2018, driven by a slightly smaller operating profit and higher non-operating expenses. Nevertheless, we believe that our overall profitability level remains strong relative to the industry and we remain excited about our longer-term prospects given our slate of new products that are being launched in 2018.
As previously discussed, management is pursuing strategic alternatives with a view to improving its capital structure and unlocking value for all stakeholders. While the Company cannot offer any assurances that these discussions will result in a successful transaction, these discussions are ongoing.”
Vicenç Marti, Tangelo’s President, added: “Tangelo has been included on the shortlist of nominees in the ‘Social Slots Operator’; ‘Acquisition Strategy’ and ‘Social Operator’ categories for the EGR North America Awards 2018, one of the most significant recognitions in the online gaming industry.
These awards are a testament to the efforts and successful teamwork of our Barcelona and Tel Aviv teams and speak to the continued development of Tangelo’s business. We are very honoured to be recognised as leading operators across North America by these prestigious awards.”
Financial Results and Non-IFRS Measures
The Company has included certain Non-IFRS performance measures, namely EBITDA and adjusted EBITDA and working capital, within this press release. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, we and certain investors and securities analysts use this information to evaluate the Company’s performance and ability to generate cash, profits and meet financial commitments. These Non-IFRS measures do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. These Non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
EBITDA is defined as “Earnings Before Interest, Tax, Depreciation and Amortization”. Adjusted EBITDA adjusts EBTIDA for due diligence and transaction costs and restructure and severance expenses as these are generally non-recurring. The Company removes stock-based compensation in calculating Adjusted EBITDA as it is a non-cash expense that can vary significantly depending on the timing of option grants. EBITDA does not include the discontinued operations of Vast and Tech Channel. The following table provides a reconciliation to Operating Loss/Income on the Statements of Consolidated Income and Comprehensive Loss for the quarters ended March 31, 2018 and 2017 as reported in the Company’s condensed interim consolidated financial statements.
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| 2018 | 2017 | |||||||
| Operating loss, in 000,000's | $ | (1.11 | ) | $ | (0.57 | ) | ||
| Add back: | ||||||||
| Transaction costs | - | 0.05 | ||||||
| Severance and restructure costs | - | 0.05 | ||||||
| Depreciation of equipment | 0.02 | 0.04 | ||||||
| Amortization of intangibles | 2.91 | 2.83 | ||||||
| Stock-based compensation | 0.01 | 0.03 | ||||||
| Adjusted EBITDA | $ | 1.83 | $ | 2.43 | ||||
About Tangelo
Tangelo Gaming Corp., the parent company of Tangelo Israel and Tangelo Spain, is a developer of social and mobile gaming for desktop, iOS and Android platforms. Tangelo Israel and Tangelo Spain design, develop and distribute their top ranked social casino-themed games within online social networks (such as Facebook) and mobile platforms (such as Android and iPhone). All of the Tangelo Israel and Tangelo Spain games are free to play and generate revenue primarily through the in-game sale of virtual coins.
Further Information
Spyros P. Karellas
President & CEO
Pinnacle Capital Markets LTD.
Mobile/Office:416-433-5696
www.pinnaclecapitalmarkets.ca
spyros@pinnaclecapitalmarkets.ca
Skype: spyros.karellas
Caution Regarding Forward-Looking Information:
Certain statements in this press release may constitute “forward looking statements” which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this press release, such statements may use such words as “may”, “will”, expect”, “believe”, “plan” and other similar terminology. These statements include, but are not limited to, statements with respect to the future business and operations of the Company, the ability of the Company to release new and successful games, the financial results of the Company and its subsidiaries, negotiations with the Company’s lenders to extend or amend terms of the credit facility, the potential to enter into a strategic or financing transaction with a third party or receive approval from the Company’s lenders to enter into such transaction and the future prospects of the Company. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. The forward-looking statements involve a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, general economic, market or business conditions and future developments in the sectors of the economy in which the businesses of Tangelo operate. The foregoing list of factors is not exhaustive. Please see the Company’s short form prospectus dated March 27, 2015, the Company’s Annual Information Form dated November 11, 2015 and other documents available under the Company’s profile on www.sedar.com, for a more detailed description of the risk factors. The Company undertakes no obligation to update publicly or revise any forward-looking statements, whether a result of new information, future results or otherwise, except as required by law.
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