Total operating expenses at c11.6 million were c0.5 million higher than in 2007 (c11.1 million). Before
exceptional items, share option charges, depreciation and amortisation, other operating costs grew to c8.4
million from c7.3 million. Much of this increase was associated with bringing in-house the CRM and customer
service functions in the offices of Malta and Israel.
Personnel expenses (other than share option charges) 4,817 3,449
Professional fees Fort Knox (384) 692
Professional fees Other 1,486 1,469
Office running 1,755 784
Foreign exchange differences 36 247
Other 674 653
Total 8,384 7,294
The Group’s headcount grew from 38 to 70 during the year. The costs, (net of share option charges), rose by
40% from c3,449k to c4,817k as the Group built-up its in-house presence in CRM and customer services in
both Israel and Malta. Share option charges fell back from c815k to c557k as some options issued during
2004 reached the end of their charge period under accounting standard IFRS 2 share based payments.
The Group has geographical presence in seven jurisdictions and licences in three. There are eight separate
legal entities in the Group. As a consequence, a substantial amount of expenditure each year is incurred with
professional advisors. The Group seeks at all times to get best-value for its shareholders yet at the same time
have access to top quality advice. During the year the costs fell overall from c2.2 million to c1.1 million, but
the bulk of this reduction was a due to a substantial charge made in 2007 and a subsequent credit in 2008
relating to the Fort Knox claim which has previously been disclosed to shareholders.
Foreign Exchange Differences
The Group’s principal operating currency is the Euro. Costs are also incurred in Israeli Shekels, US Dollars and
British Pounds. Exchange differences are created when net current assets/liabilities in currencies other than
the Euro are translated into the Euro. In the aggregate, exchange losses of c36k were incurred in the year
(2007: loss of c247k).
The Group incurred exceptional costs during the year. c316k was incurred on professional fees arising from
the abortive bid approach; c526k was incurred on termination and other costs associated with changing the
Board during 2008; c1,075k loaned to the external operator of Winzingo was written off, as in the opinion of
the directors, it is not collectable in the short term.
Depreciation and Amortisation
The depreciation charge increased from c57k to c436k principally as the Group registered, and fitted-out a
branch office in Israel. Around 27 staff are employed on a formal payroll in Israel.
Amortisation decreased from c2,919k to c280k as the majority of intangible assets subject to amortisation
were fully amortised in 2007.