Great Canadian Gaming Hard Hit By 2020
The global health crisis has taken a significant toll on the performance of business across the country ever since it first emerged in early-2020. The gaming industry, in particular, has suffered a massive blow as a direct result of countrywide closures, and it’s a dilemma highlighted in the Q4 full-year financial results recently published by local operator Great Canadian Gaming Corporation.
The closures, which remained in force months on end, in some cases even up to an entire year with only intermitted reopenings, have led to decreases across the revenue board for the gaming giant, including adjusted EBITDA, net losses incurred by shareholders’ earnings, a massive plummet in total cash flows, and a driving down of overall revenue performance on a year-on-year basis.
The Challenges Detailed
The company reported an increase in negative free cash flow of $97.4 million for the final quarter of 2020, and a $326.4 million negative free cash flow over a 12-month period ended December 31, 2020.
The increase was largely brought about by a massively decreased adjusted EBITDA created by the long-term temporary closures of the operator’s gaming venues. The higher interest incurred on outstanding credit facilities were at least in part off-set by income tax relief, confirmed the operator.
Credit facilities had become an interest-incurring backup during the period covered by the report, and as a direct result of a decrease in cash income generated by Great Canadian Gaming’s operating activities. Cash inflow for the year-long period ended on December 31st came to $105.1 million, which is decidedly lower than previous years.
Apollo Brings Future Relief
According to interim chief executive officer Terrance Doyle, significant steps had been taken by the gaming giant as it worked its way through a period marked by incredible uncertainty and financial instability. Doyle said the corporation had however made significant progress in terms of securing a successful future, and most notably as demonstrated by the arrangement concluded alongside outside investment vehicle, Apollo Funds.
The Apollo Funds alliance presents shareholders with a phenomenal opportunity to hold on to the value of their shares, explained Doyle, who added that the corporation is currently hard at work satisfying all of the necessary due diligence and closing conditions – including the final outstanding regulatory requirements.
Doyle added that it had been this approach and willingness to go above and beyond that had allowed the corporation to safety resume operations at its Atlantic City and Ontario gaming venues for at least a portion of the fourth quarter of last year.