C R Y P T O L O G I C

C R Y P T O L O G I C PowerPoint PPT Presentation


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C R Y P T O L O G I C

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2. The story… at a glance Long history of profitability, cash generation Award-winning casino games, best in the industry 10 new customers in 2008, including some of the biggest names in gaming Partnerships with global entertainment brands – a huge opportunity for growth Successful transition to new market, new business model Strong European base will drive 2009 growth Long-term investments in Asia

3. Today’s presentation The company The market The model The results The strategy Q&A

4. The company: The e-gaming pioneer

5. The market: Forecasts for growth

6. The market: Forecasts for growth … including growth in CryptoLogic’s core segments: casino and poker Entire i-gaming industry is <5% of total global gaming market

7. The model: How we operate in Europe today

8. The model: Core products & services Casino and Poker Branded Games award-winning online casino software: 280+ table and slot games exclusive licensing of top global entertainment brands (e.g., Marvel, DC Comics, Paramount) Part of International Poker Network, in partnership with GTECH multiple languages, currencies and platforms (e.g., download, non-download) Integrated proprietary ECash system (online “cashier”) Back-office software sophisticated business intelligence & data-mining tools 24/7 call center customer support, Network Operation Center support Marketing support services competitive advantage increases royalty rates

9. The model: Recurring royalty revenue Recurring royalty streams: >90% of revenue Internet casino software Individual branded games ECash software back office tools customer contact centre marketing support Other revenue one-time software customization fee certain marketing support fees professional services fees portals

10. Results: A strong history, a time of transition

11. Uses of Working Capital 2008 $million Dividends Paid 5.4 Shares Repurchased 1.4 Investments in New Businesses 3.9 Capital Expenditure 4.6 Operations 4.7 Departure costs of CEO 3.4 Restructuring and other movements 3.6 Total Working Capital Used 27.0 Working Capital is comprised of the companies current assets less current liabilities. This is the best measure of the surplus cash in the business.

12. Optimizing expenditures

13. Strong balance sheet

14. 2009 plan Right-size cost structure, refocus business Cut operating costs by $13 million through poker partnership, employee reductions, facilities downsizing Bring new customers on stream A transition from old to new customer base Branded games hold huge promise Platform partners mean rapid implementation Financial targets: Ambitious & achievable Net income: $9-$10 million Diluted EPS: $0.65 - $0.71 cents Revenue from new customers: $ 8 million Cash generation: $11-$13 million

15. The strategy

16. 2009 priorities Maintain industry leadership Top Casino Software Award, 2006, 2007, 2008 Grow our innovation engine CryptoLogic Centre for Innovation Pursue a blend of proven & promising gaming/entertainment concepts Famous brands: Spider-Man, Hulk, Superman, Batman, Street Fighter II, King Kong Casual games – Bejeweled, Cubis, Sudoku Cultural-specific games

17. 2009 priorities (II) Focus on What We Do Best Hosted casino License branded games Providing poker on the International Poker Network provides higher liquidity – at far lower cost Increase Revenue with New Business Major wins with 888, Partygaming, GigaMedia and SkyBetting & Gaming Healthy pipeline of new customers for future growth Dramatically reduce costs Take cash costs from $60 million annually to $45 million

18. Our guiding principles Make the CryptoLogic brand synonymous with innovation Anticipate customers’ needs Show passion and commitment in all we do Settle only for being the best Make a difference for every customer, every player, every investor

19. Questions

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