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Poker.co.uk - Poker News Archive
Monday 24th May 2010 Fourth quarter blues for GigaMedia
Taipei-based GigaMedia Limited, the firm behind online poker site EverestPoker.com, has announced its financial results for the fourth quarter of 2009 showing a ten percent year-on-year decrease in revenues to $40.25 million.
However, this figure was an eight percent increase when compared to the previous three-month period with GigaMedia stating that its most recent results had been negatively affected by ‘economic conditions and strong competitive pressures in Europe’ along with ‘substantial marketing and other expenses related to unsuccessful new online game initiatives in Asia’.
“Both the gambling software and the Asian online games businesses delivered worse than expected performance during the year,” read a statement from the Taiwanese firm.
“In addition, in the fourth quarter the company wrote-off several non-performing games and game investments with an aggregate non-cash net impact hit of approximately $49 million. As a result, fourth quarter net loss was $51.7 million and full-year net loss was $49.1 million.”
“Year-over-year results reflected a decline in the company's gaming software business revenues, which offset increased fourth quarter contributions from the Asian online games business. The quarter-over-quarter revenue increase reflected a 16 percent increase in gaming software business revenues during its traditionally strong fourth quarter, which more than offset a revenue decrease in the Asian online games business.
“Consolidated gross profit for the fourth quarter decreased 13 percent to $31.3 million from $36 million in 2008 and increased 13 percent quarter-over-quarter from $27.7 million, primarily reflecting period variations in gaming software business revenues.
“Fourth quarter 2009 consolidated gross profit margin decreased to 77.8 percent from 80.7 percent in the same year-ago period and increased from 74.5 percent in the third quarter. The year-over-year decrease was primarily related to a decreased gross margin in the Asian online games business resulting from expenses involved in licensed game launches during the period. The quarterly sequential increase was largely attributable to revenue growth in the gaming software business during the traditionally strong winter season, which outpaced certain fixed costs in the business.”
Last week, GigaMedia revealed that it had completed the sale of 60 percent of its virtual gambling business to Mangas Gaming, which has netted it an initial cash payment of $100 million. It stated that the final price for the stake would be set in May of 2012 at a ‘fair market value’.
Source: OnlineCasinoNews
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