Market consolidation stings Parlay

Leading Canadian online and television bingo solutions developer and supplier Parlay Entertainment Incorporated has announced its financial results for 2009 showing a 66 percent year-on-year drop in revenues to $3.3 million.

The final quarter of 2009 was also disappointing as Parlay revealed revenues for the three-month period of $781,179, which was 71 percent less than the $1.2 million recorded for the final quarter of 2008.

The Ontario firm reported a deficit of $2.2 million in earnings before interest, tax, depreciation and amortisation for 2009, which was considerably lower than last year’s surplus of $957,821, while it had a shortfall of $558,080 for the final quarter of the year, four times less than for the concluding three months of 2008.

“Last year was a transitional year for Parlay with significant challenges but also the emergence of numerous opportunities,” said Scott White, Chief Executive Officer for Oakville-based Parlay.

“As a result of our divestiture in 2008, we commenced developing a strategy to replace recurring revenue that was lost as a result of that transaction.

“Given the significant consolidation in the online bingo sector and the fact that some of our customers were part of that consolidation, timing was such that our business model could be expanded allowing us to move into the business of operating gaming platforms. Throughout 2009 we invested significant financial and human capital resources in the development of our Alderney and North American gaming platforms, which operate under the brand Parlay Games Services. Although these platforms are accelerating in terms of growth today, we generated very little return from this significant investment in 2009, resulting in a substantial loss and cash burn.

“With 2009 as our reformulation year, we are pleased to report that we have in excess of 40 networked partner sites, which are either launched or launching within Parlay Games Services. We also have numerous prospective partner arrangements in various stages of development.

“With the market changing again because of additional consolidation, we are now in a unique position to offer services to various customers who are searching for new solutions in the bingo vertical. With a revised cost structure and a robust and envied technology platform, it will be our intention to supplement our traditional software licensing model throughout 2010 with the growth of Parlay Games Services throughout the world.

“As we have outlined previously, our offering will be flexible and unique, fostering customer access into multiple software technologies offering multiple software vendors, both gaming and non-gaming products and multiple languages and currencies.”