10/3/2004
Revenue growth of 83%, Earnings of $1,210K and Net Income of $0.07 per diluted share
Chartwell Technology Inc., a leading provider of gambling software systems and entertainment content to the online and online gambling industry, announces unaudited financial results for the third quarter ended July 31, 2004, and accounting policy change.
Highlights of the quarter included:
- Revenue of $3,598K compared with $1,966K during the same period in fiscal 2003
- Net earnings of $1,210K or $0.07 per diluted share compared with net earnings of $ 213K or $0.02 per diluted share during the same period in fiscal 2003
- Cash flow from operations of $1,411K compared with $ 308K during the same period in 2003
- Working capital of $9,708K
- Retroactive change in revenue recognition policy
鉄olid revenue and earnings performance continued in the third quarter and we remain on track to achieve our financial objectives for 2004�, states Don Gleason, Chief Financial Officer. 徹ur license fee revenue continues to grow at planned levels and prudent and effective cost management have enabled the Company to increase operating margins and net earnings. For the remainder of 2004 we will continue to focus on profitability, expanding our customer base and product portfolio�.
Compared to the same period of 2003, revenue increased 83%, operating income increased 266%, earnings increased 466% and earnings per diluted share increased 250%.
Total revenue increased to $3,598K from $1,966K in the comparative quarter in 2003. Although software set-up revenues are below last year's level, recurring license fee revenue continues to show sequential quarterly growth. License fees increased by 26% to $3,392K over the previous quarter and by 100% over the comparable quarter of 2003.
Operating expenses increased to $2,079K from $1,024K in the comparative quarter of 2003. Overall, operating expenses as a percentage of total revenue have decreased to 57.7% of total revenue compared to 78.9% in the third quarter of 2003. Planned headcount additions in the software development and support organizations and investments in building the Poker Community have increased software development costs by 13.3% to $1,172K compared to $1,024K in the comparative quarter of 2003. Software development accounted for 56% of the Company's costs in the third quarter of 2004 compared to 52% in the comparable quarter of 2003. Sales, general and administrative expenses increased by 62% to $764K compared to $473K in the comparable quarter of 2003. The increase is partially attributable to investments made in sales and marketing including the London office.
Despite planned increases in costs associated with investing in the Company's growth, income from operations increased to $1,519K from $414K in the comparative quarter of 2003.
For the three months ended July 31, 2004 the Company reported a foreign exchange loss of $105K. The loss resulted from the revaluation of U.S. dollar monetary assets, including outstanding accounts receivable.
Net earnings increased to $1,210K from $213K in the comparative quarter of 2003. Basic and diluted earnings per share increased to $0.08 and $0.07 respectively from $0.02 in the comparative quarter of 2003.
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