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Cryptologic Reports First Quarter Losses

Date published: 10 May 2010

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The online gambling industry is a fickle one, where some online gambling firms are so profitable, they are just about printing their own money, while others are making losses, and others still are forced to close as they can no longer operate profitably.

Large online gambling software developer Cryptologic is in the middle category after recently posting its first quarter results which showed a loss compared to the same period last year. The gambling software firm posted a $3.2 million net loss (25c a share).

With its headquarters in Dublin, Ireland, Cryptologic reported that its Q1 revenues dropped by a notable 25 per cent to $7.6 million. According to Cryptologic President and CEO, Brian Hadfield, the cause of the loss is a drop in wagering across the board.

'While subdued wagering activity impacted our revenues in the first quarter, the outlook for 2010 as a whole remains encouraging,' he said. 'Operating costs have declined further while our revenue base is showing signs of improvement in the second quarter.

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'The start of the FIFA World Cup soccer tournament in South Africa in June this year provides short term uncertainty. However, with a strong backlog of new business, we expect that our results will improve gradually as the year unfolds,' explained the CEO.

Hadfield also said that Cryptologic is continuing to assess its various revenue streams, operating costs and strategies as it strives to negotiate itself back to profitability. So despite its disappointing Q1, Hadfield remains upbeat about the future of Cryptologic.

The firm has high expectations that not only will wagering activity pick up, but that its branded game revenues will increase as more of its games go live. Currently Cryptologic licensees carry 108 games, but there are reportedly 92 new games still to be launched.