Canadian gambling technology provider Amaya Gaming Group saw a surge in its first quarter net income thanks to the recent sale of its WagerLogic subsidiary. Revenue in the first three months of 2014 rose 8% to C$41.2m (US $37.9m) thanks to increased gaming machine sales by its Cadillac Jack subsidiary. Expenses rose even higher (11%) to $49.6m thanks to lingering expenses from the WagerLogic sale and last summer’s acquisition of US lottery division Diamond Game. But the WagerLogic sale and other investment gains pushed net income to $39.6m, a sharp turnaround from the $7.4m loss in the same period last year.
Things get a little less out of whack on the adjusted earnings front, which rose 23% to $14.8m, while adjusted net earnings fell 13% to $3.3m. For 2014 as a whole, Amaya is projecting revenue of between $193m and $203m and adjusted earnings of $77m to $86m. Amaya CEO David Baazov noted that WagerLogic was one of two assets the company had targeted for selling in Q4 2013 and Baazov hopes to announce “further details on an agreement to sell” the other asset sometime in Q2.
In April, Cadillac Jack announced deals to ship 1,100 machines to existing and new US customers, with installation set for Q2. Cadillac Jack also received a license to provide Class II gaming machines to operators in Wisconsin. Amaya’s busy gaming machine division is also awaiting transactional waivers from New Jersey’s Division of Gaming Enforcement to supply its Genesis DV1 slot machine platform to Atlantic City casinos. Amaya just completed a refinancing of Cadillac Jack’s debt that Baazov says will allow Amaya to “compete more significantly in more verticals.”
IRON MAN OUT, MAN OF STEEL IN
Baazov talked up his company’s content supply deals with online gambling operators in Europe and New Jersey, specifically the half-dozen casino titles Amaya launched in Q1, including jackpot slots based on Superman and Wonder Woman. Amaya is developing more titles based on DC Comics characters thanks to the deal Amaya extended last year with Warner Bros.
Baazov made no mention of the fact that operators offering Amaya titles based on Marvel Comics characters were recently required to withdraw these products from their sites. In 2009, Marvel was acquired by Disney, which has struck a defiantly anti-gambling stance in defending the purity of its DisneyWorld theme park from proposals to bring resort casinos to Florida. In November, a Disney spokesperson said the company had “discontinued plans to initiate or renew slot machine licensing agreements” as existing deals expired.
Marvel’s licensing deal with Amaya subsidiary Cryptologic was apparently the first of these pacts to expire, which left Amaya no choice but to pull the products from its partners’ sites. Playtech’s Marvel deal reportedly has a ways to go before it expires, ensuring Iron Man, Thor and Spiderman will continue to give gamblers goose bumps for a little while longer. Just not in New Jersey.
