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Annual Report & Accounts 2006 - Chairmans Statement
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Gaming VC Annual Report 2006 CHAIRMAN’S STATEMENT On behalf of the Board of Gaming VC SA, I am pleased to present the results of the company’s trading for the year ended 31 December 2006. I also want to share the important changes we implemented during 2006, and the new direction we have carefully planned to pursue in 2007 and beyond. I am con¢dent that we are stronger, more knowledgeable, and in a better position to generate increased returns for our shareholders in the future. The ¢nancial results for the year ended 31 December 2006 show an operating pro¢t of C13.5 million (2005: C13.9 million), before share option charges and taking C8.3 million of accelerated amortisation charges on the Group’s software licences, plus a C33.3 million write down of goodwill primarily driven by the potential impact of the continuing German Laender’s regulatory position against the online gaming industry. Since the year end the Board has been encouraged by the position taken by the EU Commission, and the healthy debate in Germany at the quarterly sessions of the Laender Prime Ministers on the regulation of online gaming. The Board has recommended a ¢nal dividend of 13p gross (c C0.193) giving a total distribution of 26p (c C0.386) for the year (2005: 42p (c C0.604)). The ¢nal dividend will be paid on 29 May 2007 to all shareholders on the register at the close of business on 27 April 2007. We have made important changes in management and the Board during the year. I accepted the position of non-executive chairman on 1 November 2006. At the same time, we announced that Steve Barlow was stepping down from his position as Chief Executive, and that a search has been started for a replacement with extensive online gaming experience. I am pleased that the search was completed and that Kenneth Alexander was appointed Chief Executive effective 1 March 2007. Mr Alexander’s initial views on strategy and structure are included in the Chief Executive’s review. Shareholders will be asked to con¢rm Mr. Alexander’s appointment to the Board at the AGM which will be held on 15 May 2007. During the year, the Board accepted resignations from Dr. Robert Willis and Scott Miller as Executive Directors, and also from their Board positions. The Board appreciates their service to Gaming VC in the initial development of the Group. I am con¢dent that we now have a stronger and more experienced management team to take the Group to the next stage of its development. The Core business in Germany is cash generative, and the ¢rst three months of the 2007 ¢nancial year are in line with expectations. With experienced ¢nancial and operating management leading the business, we are able to expand with con¢dence into new European markets outside of Germany. Adrian J. R. Smith Chairman