Pollard Banknote Limited (TSX: PBL) ("Pollard") today released its financial results for the three and nine months ended September 30, 2018, generating record quarterly revenue and strong earnings.
"Our third quarter results achieved significant milestones," commented John Pollard, Co-Chief Executive Officer, "including record quarterly revenue, driven by strong instant ticket volumes and higher average selling prices, combined with good results from our recent acquisitions. At $94.5 million, our third quarter revenue in 2018 is up 33% over the same period last year while the first nine months of this year has seen our revenue increase 27% year over year. This higher revenue has helped us achieve significant growth in our net income, which increased over 34% during the nine months ended September 30, 2018, an impressive achievement given that 2017 was also a very good year for Pollard."
"We continue to see excellent performance in our instant ticket category, particularly in the higher value proprietary games such as Scratch FX® and laminated games like our PlayBooks®. The higher sales of these products was driven by great designs, as well as the holiday season, which helped generate higher average selling prices. These specialty games have proven successful in generating additional retail sales for our lottery customers, leading to more proceeds available to fund their good causes."
"Adjusted EBITDA for this quarter was $14.2 million, reflecting the contribution of all of our business units and helping us achieve a record level for the nine month period of just over $41 million. We continue to see healthy margins across all product lines as costs remain within our expectations."
"In addition to increased revenue from our core instant ticket products, revenue from our charitable games product line was also higher due, in part, to the revenue of our acquisition earlier this year of International Gamco. During the quarter International Gamco's Oasis division entered into the new North Dakota electronic pull-tab gaming market with the sale of a number of machines. While still early, the performance of our machines has been encouraging. The one-time impact of machine sales is also supplemented through an ongoing revenue share based on machine play, so we will continue to benefit in the future as the market develops."
"As encouraging as the financial results have been in this new electronic pull-tab market, we are also very proud to see this implementation being jointly managed by our staff at International Gamco in conjunction with a large group from Diamond Game. These two organizations have come together seamlessly to address the market need and is a very clear example of our acquisition strategy providing some key operational business achievements."
"We are hopeful that this kind of success will continue with our purchase of the operating assets and business of Schafer Systems, which closed on October 31, 2018. We are very excited about the addition of the strong team at Schafer to our organization and their expertise in ticket retailing will allow us to further leverage our position as the partner of choice for lotteries to maximize sales at retail."
"Pollard continues to be seen as a leader in the lottery and charitable gaming industry," added Doug Pollard, Co-Chief Executive Officer. "We continue to make investments in product development and innovations to lead the industry, as well as advising key stakeholders in all areas of the ever growing gaming universe. Our product portfolio is expanding, not just through exciting products obtained with our acquisitions, but through working closely with lotteries to develop and provide them with the tools necessary to succeed. Responsive loyalty programs, leading edge sales force management technology and the market leading iLottery solution are just a few of the examples of how we can not only help lotteries grow, but do so in a way that brings them much closer to understanding their consumer and building that relationship. Our third iLottery operation went live in the third quarter, in New Hampshire, and the results have been very positive."
"The third quarter financial results highlight the value of our strategic vision," concluded John Pollard. "By focusing on the lottery and charitable gaming sector, we are able to combine our expertise with market leading products and innovative services to enable our lottery and charitable gaming customers to achieve greater success in exceeding their objectives."
www.pollardbanknote.com
