CryptoLogic Warns of Losses this Quarter

October 19, 2009 | News Category: Casino Software

0 Comments

CryptoLogic have informed their investors that they should not expect good results when their quarterlies are released this November. CryptoLogic are not the only online gambling software developer that have shown losses. PartyGaming have also recently announced that they have had a declining third-quarter.

At this time, CryptoLogic are predicting that their revenues will be down nearly one third from the same quarter in 2008. Although the third quarter is usually a slow business period, CryptoLogic seem to have taken rather a large knock this year.

Because of uncertain economic conditions, and a general slowing down of wagering activity, the whole online gambling industry has been somewhat negatively affected for the third quarter. More specifically, for CryptoLogic, these issues have caused CryptoLogic’s wagering volumes to decline drastically when comparing it with the same quarter in 2008. The decline has been notable in both online casino and online poker operations.

Although it is expected that the third quarter is the slowest time of the year for online gambling operations, it seems that the usual September uptick in the market has been below the usual trends for the industry.

The company is expecting to report a trading loss of around $3.4 million, out of the reported revenue of around $9.6 million for the third quarter of 2009.

All is not lost for CryptoLogic, since the company has brokered many deals that should generate income in the fourth quarter. CryptoLogic has expanded the number of branded games that they offer to a total of 33. In the first quarter of the year, only three branded games were offered, and in the second quarter, there were only thirteen. The branded games for the third quarter were only released by most CryptoLogic customers fairly late in the season, which means that the revenue for these games will be added to the fourth quarter this year, and not to the third quarter.

Not only have the branded games increased, but CryptoLogic has aggressively pursued new licensees. To date, the online gambling software company has signed agreements with 28 new licensees. It is expected that this business strategy will increase profits, although a CryptoLogic spokesperson says that the increase in profits will most likely be slower than previously anticipated.

This online casino software developer, CryptoLogic, is listed on the London Stock Exchange. Within hours of this announcement, the shares lost 17 percent of their value.