HONG KONG--(BUSINESS WIRE)--Asia Entertainment & Resources Ltd. (AERL) (OTCBB: AERCF - News) (OTCBB: AERLF - News), which operates through its subsidiaries as a VIP room gaming promoter, today announced audited combined statement of operations of its affiliated VIP gaming promoter companies (Promoter Companies) for the year ended December 31, 2009. The Promoter Companies are affiliates of Asia Gaming & Resort Limited (Asia Gaming), which AERL acquired on February 2, 2010. The operations of the Promoter Companies constitute all of AERL’s business and are the source of its revenues and earnings.
“2009 continued strong growth in the Macau VIP gaming industry, which is evidenced in our 62.7% growth in Rolling Chip Turnover year over year. As the first Asian VIP gaming promoter to list shares publicly in the U.S., we are pleased to offer investors the ability to capitalize on a growing industry,” said Leong Siak Hung, CEO of Asia Entertainment.
2009 Summary of the Audited Combined Statement of Operations of the Promoter Companies
US GAAP Revenues totaled $60.4M in 2009 compared to $51.0M in 2008, an increase of 19% year over year. Revenues are primarily derived from the Rolling Chip Turnover, which is a metric used by casinos to measure the volume of VIP gaming room business transacted and represents the aggregate amount of bets players make.
•Total Rolling Chip Turnover in the Promoter Companies VIP gaming rooms during the year ended December 31, 2009 was $5.192 billion, up 62.7% from $3.191 billion in 2008. •VIP gaming promoters’ gross win rate as a percentage of Rolling Chip Turnover during the year ended December 31, 2009 was 2.5%, down from 3.3% in 2008. •While Rolling Chip Turnover was up 62.7%, net gaming win revenue for 2009 totaled $54.3M compared to $42.6M in 2008, up 27.5%, the slower growth rate due to the decline in the win rate from 2009 versus 2008. Net gaming wins are primarily derived from win rate percentage of the Rolling Chip Turnover. •Fees and allowances amounted to $6.2M in 2009 compared to $8.4M in 2008.
Net income in 2009 totaled $15.6M or 26% of revenues. This compares to net income of $20.2M or 40% of revenues in 2008. The decline in net income was due to the decrease in the win rate percentage despite the increase in Rolling Chip Turnover.
The commission to agents in 2009 was $39.1 million, up 56.4% from $25.0 million in 2008 due primarily to the increase in Rolling Chip Turnover. Selling, general and administrative expenses declined by 4% for the combined entity in 2009 compared to the legacy entity in 2008.
On a pro forma basis, assuming the acquisition of Asia Gaming occurred on January 1, 2009, AERL would have had diluted earnings per share of $0.45, based on 32,363,224 shares outstanding.
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