Crypto records first profit in three years
Struggling software and games developer's board remains positive following minor Q2 improvement - restructuring process "ongoing".
Struggling software developer CryptoLogic has recorded its first quarterly profit in three years.
The Canadian online branded games and casino company saw its total revenues for the second quarter of this year rise incrementally to just under US$7m compared to $6.74m for the same period last year “ an increase of just $260,000.
The business said its Q2 numbers benefited from a reduction of $0.8m in liabilities previously provided against revenue through the resolution of a dispute with a “significant supplier of games”. In late September last year CryptoLogic settled with comic book company Marvel, with the new terms including the redrawing of the licensing agreement between the two parties on a “non-exclusive” basis.The company’s revenues for the first quarter were $6m.
Proceedings were launched in April by CryptoLogic’s subsidiary WagerLogic against Marvel Enterprises Inc and Marvel Enterprises BV, with the games supplier claiming the terms of its October 2005 deal with Marvel Enterprises to be the “sole developer of Marvel-branded casino slot games on the internet” had been breached.
WagerLogic stalling the roll-out of Marvel-branded titles and launching legal proceedings against the comic book company followed rival Playtech inking an “exclusive multi-year licensing agreement” with Marvel Entertainment’s Netherlands-based subsidiary, Marvel Characters BV in March 2008 to produce Marvel-branded casino, poker and bingo games across its web, TV and mobile platforms.
In March CryptoLogic hired consultants Deloitte to carry out a strategic review of the business suggesting it could soon be part or completely sold. In a statement the company chose to only say that the review was still “ongoing” and that further announcements would be made “as and when appropriate”.
CryptoLogic has been in a state of flux ever since its former chief executive Brian Hadfield resigned a year ago following continuing losses and slow progress being made to restructure the business. Chairman David Gavagan has been in charge since Hadfield’s departure and has been forced to substantially cut the company’s workforce.
Despite continuing the restructuring process its board yesterday said it was “encouraged” by the performance in the quarter and that it “continues to focus on driving revenues further while managing costs tightly to enhance shareholder value”.