2015 Q3 Earnings Management and Directors of Gamehost Inc. (TSE:GH) are pleased to present results for the three months ended September 30, 2015 and nine months ended September 30, 2015.
Total operating revenues for the Quarter were down 6.9% to $18.8 million compared to the same quarter of 2014. Earnings before interest, taxes, depreciation and amortization that is attributable to shareholders of the Company was down 11.1% to $8.0 million compared to the same quarter one year earlier. EBITDA to Shareholders margin declined 190 basis points to 44.7% in year over year comparison. Following a record year in 2014, the Company’s reported results for 2015 will be lower and reflective of the downturn in Alberta’s economy as a result of weak oil and gas prices. Alberta, however, is certainly about more than just oil, which we think is reflected in the relative stability of the Company’s financial results in a tough commodity price environment.
After experiencing our first decline in revenue and profitability since 2010 during the first quarter of 2015, results for quarter two and now the current Quarter look to indicate that we are finding some level of stabilization. Nevertheless, we are taking a conservative and cautious approach to our budgets and forecasts. Management is working diligently to find operational savings, with some success, in an otherwise lean cost operation.
The Company’s relatively steady cash flows have supported an attractive dividend payout to shareholders. The current monthly dividend of $0.0733 per share is unchanged since it was last increased in 2008 and notably was unaffected by the fallout from the 2008 financial crisis. Management and the Company’s board of directors understand that a stable dividend has become one of the hallmarks of the Company’s identity. Although the Company is currently paying out 100% of normalized cash available for dividend distribution, the dividend is well supported by the Company’s strong cash flows and solid balance sheet. Current debt levels stand at less than one times EBITDA and we have access to ample liquidity. The Company’s board of directors regularly monitor the appropriateness of the Company’s dividend policy. Budgets and forward cash projections prepared by management are scrutinized in context of the Board’s own assessments of Alberta and macro economies. At present, the Company is well positioned to withstand possible further deterioration in market conditions. The Company’s board of directors, nevertheless, are prepared to alter the dividend policy if warranted.
Gamehost Inc. is engaged in operating hospitality and gaming properties in Alberta. The company has a market cap of $230.48 million. Through the Limited Partnership, the Company owns and operates the Great Northern Casino facility located in Grande Prairie; the Boomtown Casino facility located in Fort McMurray; owns a 91% interest in the joint venture between Gamehost and J.M. It has 11.5 P/E ratio. Wood Investments Ltd. with respect to the Deerfoot Inn & Casino, and owns and operates a 123 room hotel and approximately 10,530 square-foot multi-tenant lease facility.
The stock decreased 2.71% or $0.26 on November 13, hitting $9.32. About 6,743 shares traded hands. Gamehost Inc (TSE:GH) has declined 22.55% since April 10, 2015 and is downtrending. It has underperformed by 20.33% the S&P500.