Announcements

Consolidated unaudited results for Q1 2012

Posted on 30.04.2012

Key performance indicators of the Group

(in millions of euros)

  Q1 2012 Q1 2011
Revenue 32.2 31.1
EBITDA 8.7 6.3
Operating profit 5.8 0.6
Net profit 5.1 0.2
EBITDA margin 27.1% 20.1%
Operating margin 18.0% 2.0%
Net margin 15.9% 0.6%
ROE 6.4% 0.2%
ROA 4.9% 0.2%
Current ratio 2.2 2.9
     
Number of casinos at year-end 61 65
Casino floor area (m²) at year-end 23,418 24,658
     
Number of slot machines at the period end 2,446 2,494
Number of gaming tables at the period end 183 184

Underlying formulas:

  • EBITDA = earnings before financial expenses, taxes, depreciation and amortisation and impairment losses
  • Operating profit = profit before financial expenses and taxes
  • Net profit = net profit for the period less non-controlling interests
  • EBITDA margin = EBITDA / revenue
  • Operating margin = operating profit / revenue
  • Net margin = net profit / revenue
  • ROE = net profit / average total equity attributable to the shareholders of the parent company
  • ROA = net profit / average total assets
  • Current ratio = current assets / current liabilities

 

Key developments of the Group in Q1 2012:

  • The Group’s consolidated net profit totalled EUR 5.1 million. In Q1 2011, the Group earned a net profit of EUR 0.2 million.
  • The efficiency of the Group’s business operations improved. In Q1 2012, the Group’s income from gaming transactions and revenues totalled EUR 31.7 million, i.e. 8.8% more than compared to Q1 2011. The number of casinos in operation declined by 4, i.e. 6.2% year-over-year.
  • At the annual general meeting of the shareholders held on 19 April 2012 it was decided to reduce the share capital of the Company altogether by EUR 21,186,130.70 from EUR 81,717,932.70 to EUR 60,531,802. The share capital is reduced by reducing the calculated value of the shares from EUR 0.54 to EUR 0.40, whereas the number of the shares remains the same (i.e. 151,329,505). The reduction of share capital in the amount of EUR 15,132,950.50 shall be paid to the shareholders within the term set forth by the law. Upon reducing the share capital, EUR 6,053,180.20 shall not be paid to the shareholders but shall be used to cover the accumulated losses.

In Q1 2012, the Group’s consolidated sales revenue totalled EUR 31.7 million and the revenue totalled EUR 32.2 million, which is 3.3% more than the total revenue of EUR 31.1 million earned in Q1 2011. The Group’s EBITDA increased from EUR 6.3 million in Q1 2011 to EUR 8.7 million in Q1 2012. In Q1 2012, the operating profit totalled EUR 5.8 million, in Q1 2011 the operating profit totalled EUR 0.6 million.

In Q1 2012, gaming operations accounted for 92.1% and other revenue 7.9% of the Group’s consolidated revenue, the respective percentages for the Q1 2011 were 87.3% and 12.7%.

 

Total external income from gaming transactions and revenue (EUR thousands):

  Q1 2012 Change Percentage of total Q1 2011 Percentage of total
Estonia 7,614 17.3% 24.0% 6,490 22.3%
Latvia 7,976 24.4% 25.2% 6,411 22.0%
Lithuania 4,894 10.8% 15.5% 4,415 15.2%
Poland 6,238 -17.1% 19.7% 7,523 25.9%
Slovakia 4,255 75.0% 13.4% 2,432 8.4%
Belarus 690 -21.4% 2.2% 878 3.0%
Romania* 0 -100.0% 0.0% 944 3.2%
Total 31,667 8.8% 100.0% 29,093 100.0%

* Romanian income from gaming transactions and revenue were recognised until transfer of control to the new owner at 30 June 2011.

At the end of Q1 2012, the Group had 61 casinos, with the total floor area of 23,418 m². At the end of Q1 2011, the number of the Group’s casinos was 65 and total floor area was 24,658 m².

 

Number of casinos by segment

  31.03.2012 31.03.2011
Estonia 17 17
Latvia 21 21
Lithuania 10 11
Poland 4 6
Slovakia 4 3
Belarus 5 5
Romania 0 2
Total 61 65

 

In Q1 2012, the Group’s consolidated operating expenses decreased by 13.6% or EUR 4.1 million as compared to the respective expenses in Q1 2011. Depreciation, amortisation and impairment losses decreased the most compared to Q1 2011 by EUR 2.7 million. Staff costs with social security taxes increased the most as compared to Q1 2011 by EUR 0.3 million, rental expenses by EUR 0.2 million and licence fees and gaming taxes by EUR 0.2 million.

Staff costs with social security taxes made up the largest share of the Group’s operating expenses, i.e. EUR 8.0 million, followed by gaming tax expenses of EUR 6.7 million, depreciation, amortisation and impairment losses of EUR 2.9 million, rental expenses of EUR 2.9 million and marketing expenses of EUR 2.2 million.

In Q1 2012, the consolidated net profit attributable to equity holders of the parent company totalled EUR 5.1 million. In Q1 2011, the consolidated net profit attributable to equity holders of the parent company totalled EUR 0.2 million.

 

  

Overview by markets

Estonian segment

In Q1 2012, the external revenue of the Estonian segment totalled EUR 7.9 million, of which the income from gaming transactions totalled EUR 6.9 million and other revenue and income totalled EUR 1.0 million. The external revenue of the Estonian segment decreased by 6.9% compared to Q1 2011 (whereas the external sales revenue increased by 17.3%). The market share of Olympic Casino Eesti AS in the Estonian gaming market was 54% at the end of Q1 2012 and 54% at the end of Q1 2011. In Q1 2012, the total Estonian gaming market increased by 16.6% as compared to Q1 2011.

In Q1 2012, the EBITDA of the Estonian segment totalled EUR 1.8 million and the operating profit totalled EUR 1.1 million. In Q1 2011, the EBITDA of the Estonian segment totalled EUR 2.9 million and the operating profit totalled EUR 1.8 million.

At the end of Q1 2012, there were 17 Olympic casinos with 699 slot machines and 21 gaming tables in operation in Estonia.

 

Latvian segment

In Q1 2012, the external revenue of the Latvian segment totalled EUR 8.1 million, of which the income from gaming transactions totalled EUR 7.3 million and other revenue and income totalled EUR 0.8 million. The external revenue of the Latvian segment increased by 26.1% compared to Q1 2011. The market share of Olympic Casino Latvia SIA in the Latvian gaming market was 21% at the end of Q1 2012 and 20% at the end of Q1 2011. In Q1 2012, the total Latvian gaming market increased by 23.8% as compared to Q1 2011.

In Q1 2012, the EBITDA of the Latvian segment totalled EUR 3.6 million and the operating profit totalled EUR 2.9 million. In Q1 2011, the EBITDA of the Latvian segment totalled EUR 2.4 million and the operating profit totalled EUR 1.4 million.

At the end of Q1 2012, there were 21 Olympic casinos with 646 slot machines and 25 gaming tables in operation in Latvia.

 

Lithuanian segment

In Q1 2012, the external revenue of the Lithuanian segment totalled EUR 4.9 million, of which the income from gaming transactions totalled EUR 4.6 million and other revenue and income totalled EUR 0.3 million. The external revenue of the Lithuanian segment increased by 10.2% compared to Q1 2011. The market share of Olympic Casino Group Baltija UAB in the Lithuanian gaming market was 68% at the end of Q1 2012 and 73% at the end of Q1 2011. The total Lithuanian gaming market increased by 13.6% as compared to Q1 2011.

In Q1 2012, the EBITDA of the Lithuanian segment totalled EUR 1.1 million and the operating profit totalled EUR 0.7 million. In Q1 2011, the EBITDA of the Lithuanian segment totalled EUR 0.9 million and the operating profit totalled EUR 0.4 million.

At the end of Q1 2012, there were 10 Olympic casinos with 350 slot machines and 52 gaming tables in operation in Lithuania.

 

Polish segment

In Q1 2012, the external revenue of the Polish segment totalled EUR 6.3 million, of which the income from gaming transactions totalled EUR 6.1 million and other revenue and income totalled EUR 0.2 million. The external revenue of the Polish segment decreased by 16.2% compared to Q1 2011.

In Q1 2012, the EBITDA of the Polish segment totalled EUR 0.9 million and the operating profit totalled EUR 0.2 million. In Q1 2011, the EBITDA of the Polish segment totalled EUR 1.1 million and the operating loss totalled EUR 0.1 million.

At the end of Q1 2012, there were 4 Olympic casinos with 307 slot machines and 41 gaming tables in operation in Poland.

 

Slovak segment

In Q1 2012, the external revenue of the Slovak segment totalled EUR 4.3 million, of which the income from gaming transactions totalled EUR 3.9 million and other revenue and income totalled EUR 0.4 million. The external revenue of the Slovak segment increased by 75.0% compared to Q1 2011.

In Q1 2012, the EBITDA of the Slovak segment totalled EUR 1.1 million and the operating profit totalled EUR 0.8 million. In Q1 2011, the EBITDA of the Slovak segment totalled EUR 0.4 million and the operating profit totalled EUR 0.1 million.

At the end of Q1 2012, there were 4 Olympic casinos with 216 slot machines and 44 gaming tables in operation in Slovakia.

 

Belarusian segment

In this interim financial statements, the Belarusian segment is regarded as a hyperinflationary economy that is subject to the accounting policies of IAS 29.

In Q1 2012, the external revenue of the Belarusian segment totalled EUR 0.7 million, of which the income from gaming transactions totalled EUR 0.6 million and other revenue and income totalled EUR 0.1 million. The external revenue of the Belarus segment decreased by 19.5% compared to Q1 2011.

In Q1 2012, the EBITDA of the Belarusian segment totalled EUR 0.2 million and the operating profit totalled EUR 0.1 million. In Q1 2011, the EBITDA of the Belarusian segment totalled EUR 0.3 million and the operating profit totalled EUR 0.1 million.

At the end of Q1 2012, there were 5 Olympic casinos with 228 slot machines in operation in Belarus.

 

Romanian segment

Olympic Entertainment Group AS signed share purchase agreement on 30 April 2011 with an Israeli entrepreneur for selling all the shares in Romanian subsidiaries Olympic Casino Bucharest S.R.L, Muntenia Food and Beverage S.R.L. and Olympic Exchange S.R.L. As of 30 June 2011 shares of Romanian subsidiaries have been registered to the buyer.

 

 

Financial position

At 31 March 2012, the consolidated balance sheet total of the Group was EUR 107.0 million (31 December 2011: EUR 101.0 million). The balance sheet total increased by 6.0% in Q1 2012.

Current assets totalled EUR 53.6 million or 50.1% of total assets, and non-current assets totalled EUR 53.4 million or 49.9% of total assets. At the balance sheet date, the liabilities totalled EUR 19.0 million and the equity totalled EUR 87.9 million. The largest liability items included borrowings of EUR 5.5 million, tax liabilities of EUR 4.9 million and payables to employees of EUR 3.2 million.

 

Investments

In Q1 2012, the Group’s expenditures on property, plant and equipment totalled EUR 1.4 million, of which EUR 1.0 million was spent on construction and reconstruction of casinos and EUR 0.4 million on new gaming equipment.

In Q1 2011, expenditures on property, plant and equipment totalled EUR 0.4 million.

 

Cash flows

In Q1 2012, the Group’s cash flows generated from operating activities totalled EUR 8.3 million. Cash flows from investing activities totalled EUR 1.6 million and cash flows used in financing activities totalled EUR 0.8 million. Net cash flows totalled EUR 9.2 million.

In Q1 2011, the Group’s cash flows generated from operating activities totalled EUR 7.3 million. Cash flows used in investing activities totalled EUR 0.5 million and cash flows used in financing activities totalled EUR 0.8 million. Net cash flows totalled EUR 6.0 million.

 

Staff

At 31 March 2012, the Group employed 2,296 people (31 December 2011: 2,336): 520 in Estonia, 470 in Latvia, 603 in Lithuania, 375 in Poland, 222 in Slovakia and 101 in Belarus.

In Q1 2012, employee wages and salaries including social security taxes totalled EUR 7.9 million (Q1 2011: EUR 7.8 million). In Q1 2012, 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 0.17 million (Q1 2011: EUR 0.15 million) and EUR 0.04 million (Q1 2011: EUR 0.04 million), respectively.

 

Consolidated statement of financial position

  31.03.2012 31.12.2011
ASSETS    
Current assets    
Cash and cash equivalents 42,590 33,413
Financial investments 7,246 9,508
Receivables and prepayments 2,524 2,606
Prepaid income tax 286 397
Inventories 925 909
Total current assets 53,571 46,833
     
Non-current assets    
Deferred tax assets 1,162 1,111
Financial investments 2,941 2,937
Other long-term receivables 723 712
Investment property 1,795 1,795
Property, plant and equipment 18,469 19,754
Intangible assets 28,296 27,822
Total non-current assets 53,386 54,131
     
TOTAL ASSETS 106,957 100,964
     
     
LIABILITIES AND EQUITY    
Current liabilities    
Borrowings 3,112 3,113
Trade and other payables 10,219 9,870
Income tax payable 1,572 1,215
Provisions 1,716 1,881
Total current liabilities 16,619 16,079
     
Non-current liabilities    
Deferred tax liability 40 90
Borrowings 2,360 3,136
Total non-current liabilities 2,400 3,226
     
TOTAL LIABILITIES 19,019 19,305
     
EQUITY    
Share capital 81,718 81,718
Share premium 14,535 14,535
Statutory reserve capital 2,470 2,470
Other reserves 80 53
Translation reserves -908 -1,776
Accumulated losses -14,808 -19,930
Total equity attributable to equity holders of the parent 83,087 77,070
Non-controlling interest 4,851 4,589
TOTAL EQUITY 87,938 81,659
     
TOTAL LIABILITIES AND EQUITY 106,957 100,964

 

Consolidated statement of comprehensive income

  Q1 2012 Q1 2011
Continuing operations    
Income from gaming transactions 29,596 26,349
Revenue 2,071 1,800
Other income 484 2,021
Total revenue and income 32,151 30,170
     
Cost of materials, goods and services -664 -635
Other operating expenses -14,644 -14,178
Staff costs -8,035 -7,156
Depreciation, amortisation and impairment -2,901 -4,186
Other expenses -110 -326
Total operating expenses -26,354 -26,481
     
Operating profit 5,797 3,689
     
Interest income 74 75
Interest expense -55 -126
Foreign exchange gains (losses) -14 16
Other finance income and costs 285 -2
Total finance income and costs 290 -37
     
Profit from operating activities 6,087 3,652
     
Income tax expense -703 -353
Net profit for the period from continuing operations 5,384 3,299
     
Net loss for the period from discontinued operations 0 -3,096
     
Net profit for the period 5,384 203
Attributable to equity holders of the parent company 5,122 183
Attributable to non-controlling interest 262 20
     
     
Other comprehensive income    
     
Currency translation differences    
From continuing operations 868 -329
From discontinuing operations 0 103
Total comprehensive profit (-loss) for the period 6,252 -23
Attributable to equity holders of the parent company 5,990 -43
Attributable to non-controlling interest 262 20
     
     
Basic earnings per share* 3.4 0.1
From continuing operations 3.4 2.2
From discontinuing operations 0.0 -2.1
     
Diluted earnings per share* 3.4 0.1
From continuing operations 3.4 2.2
From discontinuing operations 0.0 -2.1

  * euro cents

 

For further information, please contact:

Madis Jääger
CEO
Olympic Entertainment Group AS
Tel + 372 667 1250
E-mail madis.jaager@oc.eu
http://www.olympic-casino.com


Olympic_interim_Q1_2012_ENG.pdf

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