INTRALOT S.A, today announces its financial results for the nine-month period ending September 30th 2008, prepared in accordance with IFRS.
Consolidated Revenues for the period reached euro 804.5m posting a 41.5% increase compared to 9M07. EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) reached euro 161.8 m (euro 179.9m in 9M07). Earnings Before Taxes (EBT) were euro 144.9m (euro 152.5m in 9M07). Earnings after Taxes and after minorities (EAT-am) were euro 77.1m (euro 85.5m in 9M07).
Concerning the parent company, revenues reached euro 136.8m in 9M08, practically unchanged compared to 9M07. EBITDA were euro 25.2m (euro 55.6m in 9M07). Earnings Before Taxes (EBT) stood at euro 45.9m from euro 96.9m the same period last year, while Earnings After Taxes (EAT) reached euro 37.3m in 9M08 (euro 82.6m in 9M07). Parent company results were lower in 9M08 due to reduced domestic sales, but were offset with the significantly increased international expansion of the Group, as it is evident in the consolidated results.
Commenting on 9M08 results INTRALOT's CEO, Mr. Constantinos Antonopoulos, noted:
"During the past 3 months, INTRALOT has signed a number of new significant contracts. It entered the Brazilian market as the new on-line operator of the State Lottery of Rio de Janeiro. Moreover, the Company will become a major shareholder of the Hong Kong-based gaming company Melco Lottventures Limited, which will constitute our expansion arm in the highly promising Chinese gaming market but also in other places in Asia. In addition, the Company has become the new leader in Central America and the Caribbean by signing a contract in Guatemala to offer numerical, instant and video lottery games, a facilities management contract for on-line numerical and instant games in the Dominican Republic and a contract for the operation of Fixed Odds Betting in Jamaica acquiring also a stake in Supreme Ventures Limited, one of the leading gaming companies in the broader Caribbean region. Finally, an important greenfield project, the Pan-Russian lottery, successfully started operations and had its first draw in the first days of November.
Regarding our 9M08 results, the continued strong growth of the top-line reflects the international expansion and the good performance of our business. However, some developed markets have started to show some signs of a slowdown, a fact that is not the case in developing markets. On the other hand, profits have been impacted by three major factors: first, by the increased volatility and depreciation of developing market currencies majorly due to the financial crisis that we have been witnessing, second, due to the appreciating US dollar as costs related to IT are denominated in this currency, and third, by increased start-up costs that ramped up in Q3 due to the inauguration of two US state lotteries in November and business development costs for new projects.
Taking into serious consideration the current financial crisis, the Company is very careful in making business decisions and new investments and is structuring deals in ways that limit any potential downside risk. However, we foresee that the crisis will create numerous serious opportunities in various regions around the world. INTRALOT is well placed to take advantage of these opportunities due to its expertise and its very strong capital structure and unleveraged balance sheet, which is a competitive advantage over its peers.
INTRALOT is a financially healthy company with leading technology and know-how. Our view is that in the short-run developed gaming markets could experience a flat or even negative growth, while developing markets should continue to grow although currency risk should be an issue. In any case, the gaming sector should prove to be much more resilient compared to other sectors. Concluding, the Company maintains its commitment to a long-term expansionary strategy, since we foresee that it will be enhanced from the several opportunities that will arise globally".