CryptoLogic Inc. released its third quarter results this week showing that revenue and earnings had increased compared to the same period last year, but also warned that the trend may not continue now that the United States has passed legislation against online gambling.
"CryptoLogic's excellent results for the third quarter and the first nine months of 2006 reflect our strategy of innovation and our strong diversified revenue base," said Lewis Rose, CryptoLogic president and CEO. "We have already recorded higher earnings in the nine months to date in 2006 than we did for all of 2005."
Revenue was up 32% to $27.7 million from the same period last year. Earnings were also up 47% to bring them up to 53¢ per diluted share.
Through the recorded nine months ending Sept. 30, 2006, the company also reported record results. Revenue was up to $85 million; earnings were 57% higher at $23.1 million; and cash flow from operating activities was 51% higher at $35.4 million.
A stumbling block that CryptoLogic is working to overcome is the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in the United States which is another step in the nation's efforts to ban online gambling.
"Since 2001, CryptoLogic has been preparing for this eventuality by shifting its business to continental Europe and the U.K. We have achieved record year-to-date revenue and earnings and we now power the world's largest poker network that excludes U.S. players," said Rose.
"Our company's diversification, strong balance sheet, thriving European customers and potential new business in emerging markets enable us to face the future with confidence."
CryptoLogic provides licenses to online poker rooms such as William Hill Poker, InterPoker.com and .