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Cryptologic Releases 2019 Second Quarter Financial Results

TORONTO, Aug. 29, 2019 (GLOBE NEWSWIRE) -- Cryptologic Inc. (“Cryptologic” or the “Company”) (CSE:CRY) today announces its financial results for the quarter ended June 30, 2019.  Selected financial information of the Company for the three month and six month periods ended June 30, 2019 and 2018 and the year ended December 31, 2018 is set forth below:

  Three Months Ended June 30,    Six Months Ended June 30,    Year ended December 31,
    2019       2018       2019       2018       2018  
Revenue $   9,524,776     $   2,709,176     $   14,863,986     $   2,709,176     $   18,079,005  
Net income (loss) and comprehensive income (loss)     2,850,926         (51,738,445 )       (273,432 )       (51,891,224 )       (74,252,959 )
Adjusted EBITDA     4,568,457         554,050         5,475,775         431,885         5,018,658  
Adjusted EBITDA margin   48 %     20 %     37 %     16 %     28 %
Adjusted EBITDA per share     0.36         0.11         0.43         0.09         0.84  
Total assets     24,686,641         66,663,808         24,686,641         66,663,808         17,973,697  
Total liabilities     36,947,189         46,285,348         36,947,189         46,285,348         29,710,012  
Basic and diluted net income (loss) and comprehensive income (loss) per common share $   0.22     $   (10.56 )   $   (0.02 )   $   (11.18 )   $   (12.98 )
 

Cryptologic mined a total of 992 Bitcoin in the three months ended June 30, 2019, at an average price per Bitcoin for the quarter of $9,743.  The Company achieved an Adjusted EBITDA1 of $4.6 million, or $0.36 per outstanding share, resulting in an Adjusted EBITDA Margin1 of 48% for the three months ending June 30, 2019.  The Company’s cost of revenue, which includes electricity cost, contractors’ fees and general facility operating costs, but excludes non-cash depreciation of mining and infrastructure equipment, resulted in an average cost per Bitcoin mined of $4,444, an increase of $732 or 19% from $3,712 for the three months ended March 31, 2019.  The increase in the cost of mining a Bitcoin is attributable to the increase in network difficulty corresponding to an increase in network hashrate, resulting in fewer coins mined for the period on a per miner basis. Average network difficulty for the three months ended June 30, 2019, was 6.87 trillion as compared to 5.97 trillion for the three months ended March 31, 2019.

The Company reported net income of $2.9 million for the quarter on revenue of $9.5 million.  For the six months ended June 30, 2019, the Company reported a net loss of $0.3 million on revenue of $14.9 million.

The financial statements for the three months ended June 30, 2019 and the related management’s discussion and analysis (“MD&A”) are available on Cryptologic’s SEDAR profile at www.sedar.com.

For information or interview please contact:

Jordan Greenberg
Chief Financial Officer
(647) 715-3707

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1 Refer to the “Non-IFRS Measures” section of this news release.

About Cryptologic Inc.

Cryptologic Corp. is currently a cryptocurrency mining company that is focused on divesting its cryptocurrency mining assets and pursuing an acquisition opportunity in a sector outside of cryptocurrency mining.

Cautionary Note Regarding Forward-Looking Information

Certain statements in this press release, including statements with respect to the Company’s position to enter other aspects of cryptocurrency mining, contain forward-looking information which can be identified by the use of forward looking terminology such as "believes", "expects", "may", "desires", "will", "should", "projects", "estimates", "contemplates", "anticipates", "intends", or any negative such as "does not believe" or other variations thereof or comparable terminology. No assurance can be given that potential future results or circumstances described in the forward-looking statements will be achieved or will occur. By their nature, these forward-looking statements necessarily involve risks and uncertainties, including the risk that costs will be higher than anticipated reducing margins, that expense reductions will not be realized, the risk that the price of power to the Company increases and other risks and uncertainties discussed herein, that could cause actual results to significantly differ from those contemplated by these forward-looking statements. Such statements reflect the view of the Company with respect to future events and are based on information currently available to the Company and on assumptions, which it considers reasonable.  Management cautions readers that the assumptions relative to the future events, several of which are beyond management's control, could prove to be incorrect, given that they are subject to certain risk and uncertainties, and that actual results may differ materially from those projected. Other factors which could cause results or events to differ from current expectations include, among other things, the impact of general economic, industry and market conditions. Management disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking information.  The Canadian Securities Exchange has not reviewed, approved or disapproved the content of this news release.

Non-IFRS Measures

Certain terms used in this press release, such as Adjusted EBITDA and Adjusted EBITDA Margin, are not measures defined under International Financial Reporting Standards (“IFRS”) as prescribed by the International Accounting Standards Board, do not have standardized meanings prescribed by IFRS and should not be compared to or construed as alternatives to profit/loss or other measures of financial performance calculated in accordance with IFRS.  Adjusted EBITDA and Adjusted EBITDA Margin as computed by the Company may not be comparable to similar measures presented by other issuers. The Company uses these measures to better assess the Company’s underlying performance and provides these additional measures so that investors may do the same. Further details on non-IFRS measures are set out in the Company’s MD&A, which is available on the Company’s SEDAR profile at www.sedar.com.