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Exhibit 99.1 LVFHF Form 6K August 29, 2006
Symbols: LVH .TSX Venture Exchange
LVFHF.OTC Bulletin Board
LVH. Berlin & Frankfurt Stock Exchanges
Las Vegas From Home.com Entertainment Reports its 2006 Second Quarter Results
22% year-over-year Q2 2006 revenue growth
Vancouver, British Columbia, August 29, 2006– Las Vegas From Home.com Entertainment Inc.(the “Company”) or (“LVFH”) today announced results from operations for its second quarter period ended June 30, 2006.
All financial figures are in Canadian dollars.
Q2 Fiscal 2006 Financial Results:-
Second quarter revenues were $3,258,201 as compared with revenues of $2,676,154 in the same period a year ago, representing growth of 22% year-over-year. The Company experienced a 13 % decline in revenues when compared to the immediately preceding quarter ended March 31, 2006 of $3,741,055. This was mainly attributable to the fact that Q2 is usually softer and licensing revenue from third parties fell in the quarter, something the Company expects should correct itself in the future. Consequently, the Company had a net loss for the quarter of $853,501 as compared to a net gain of $385,773 in the second quarter of Fiscal 2005.
“Our core day to day operating business continues to perform, however, the combination of software delays of both of our platforms and higher operating costs, in particular marketing expenses, negatively impacted Q2. We expect to reverse these results with the imminent launch of our new software as well as consolidating operations, both of which are well underway. We are still very confident in the future with our Asian Software platform. We have relationships with leading Asian sportsbooks that already have well established payment infrastructure. They will be adding our games to their platforms, thus we are in a much better position to tap into the Asian market.” Mr. Kalpakian adds, “Also the Company’s marketing arm is undergoing a transition which we expect will be positively reflected in future results. Despite the weaker quarter, the Company’s management is confident it s diversification to, and focus on, specialized or niche markets will add to shareholder value in the future. As a result of this confidence, the Company’s board of directors is considering a normal course issuer bid of its securities.”
Outlook 2006
Despite ongoing legal concerns for the industry, operating trends remain generally positive but consolidation within the industry remains inevitable at the operating level.
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For any company to remain competitive in the industry, it must either offer a full choice of verticals to the gaming customer or carve either a dominant or niche space in the marketplace. The large number of online gaming sites and the increasingly higher barriers to profitable scale mean that consolidation will be seen by many operators as an attractive exit going forward.
The Company is continually seeking to find opportunities where it can leverage its database into other game verticals with another operator to take advantage of operating synergies.
The Company’s core business was slightly weaker in Q2 as a result of seasonal activity and software delays but the Company is optimistic that it has laid the groundwork for a stronger second half of the year.
The stronger results are expected as a result of software upgrades to its current system, the addition of real money black jack plus other new games and the introduction of several larger industry operators as new licensees.
For 2006, the Company is revising its revenue expectations between $13.5 - $16 million alone from its current poker concentrated software offering. This forecast still represents a healthy increase from the previous year.
In addition to the above, a new stream of revenue is also expected to be generated with the launching of a separate Asian Software platform, which is now scheduled for release in Q3.
This Asian initiative will not only lessen the Company’s dependence on its current business derived from one specific region, it could possibly fuel strong growth by introducing “Early or First to Market” software of already recognized and popular games in that market not yet found on the internet.
While it is pre-mature to estimate what revenue the new Asian Software platform will generate, the Company is hopeful the combination of its unique software, early or first mover advantage coupled with promising relationships will generate positive results.
LVFH’s financial statements for the second quarter ended June 30, 2006, are available on SEDAR at www.sedar.com.
Conference Call:
Date: | Tuesday, August 29, 2006 |
Time: | 5:00 pm (Toronto time) |
Local/Intl dial in number: | 1 (416) 642-5212 |
Toll Free – North America: | 1 (866) 321-6651 |
To participate in the call, please dial 1 (416) 642-5212 or 1 (866) 321-6651 five to ten minutes prior to the 5:00 pm start of the teleconference call.
This conference call will be recorded and made available for replay two hours after the completion of the call, up until midnight September 5, 2006. To listen to the replay, please dial (416) 915-1028 or 1 (866) 244-4494, and enter pass code 538321. In addition and after September 5, 2006, you may access the audio recording by visitingwww.lvfh.com and clicking on Investor Information.
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LAS VEGAS FROM HOME.COM
ENTERTAINMENT INC.
CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(Expressed in Canadian dollars)
SIX MONTH PERIOD ENDED JUNE 30, 2006
(Unaudited – Prepared by Management)
(These interim financial statements have not been reviewed by the Company’s Auditor)
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LAS VEGAS FROM HOME.COM ENTERTAINMENT INC.
Consolidated Balance Sheets
June 30, 2006 and December 31, 2005
(Canadian Dollars)
(Unaudited – Prepared by Management)
June 30 | December 31 | ||||
2006 | 2005 | ||||
(unaudited) | (audited) | ||||
ASSETS | |||||
Current | |||||
Cash & term deposit | $ | 8,214,864 | $ | 8,408,620 | |
Marketable securities (note 5) | 139,293 | 379,236 | |||
Accounts receivable (note 6) | 1,572,218 | 1,801,274 | |||
Due from related parties (note 11(c)) | 727 | 4,740 | |||
Prepaids & security deposits | 45,616 | 27,499 | |||
9,972,718 | 10,621,369 | ||||
Acquisition of three card games Software (note 12) | 2,401,200 | - | |||
Equipment & Software Development (note 8) | 2,558,533 | 2,198,239 | |||
Total Assets | $ | 14,932,451 | $ | 12,819,608 | |
LIABILITIES | |||||
Current | |||||
Customer deposits, accounts payable & accrued Liabilities (note 7) | $ | 2,153,104 | $ | 2,111,066 | |
Due to related parties (note 11(b)) | 9,685 | 60,929 | |||
Obligation under capital lease (note 9) | 11,746 | 20,268 | |||
2,174,535 | 2,192,263 | ||||
Long term portion of Obligation under capital lease | - | 2,550 | |||
Total Liabilities | 2,174,535 | 2,194,813 | |||
SHAREHOLDERS’ EQUITY (DEFICIENCY) | |||||
Capital stock (note 10(b)) | 29,684,910 | 27,096,835 | |||
Contributed Surplus (note 10(e)) | 2,389,773 | 2,306,354 | |||
Deficit | (19,316,767) | (18,778,394) | |||
12,757,916 | 10,624,795 | ||||
Total Liabilities & Stockholders’ Equity | $ | 14,932,451 | $ | 12,819,608 | |
Commitments and Subsequent Events (notes 14 & 15)
On behalf of the Board,
“Bedo H. Kalpakian”
“Neil Spellman”
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LAS VEGAS FROM HOME.COM ENTERTAINMENT INC.
Consolidated Balance Sheets
June 30, 2006 and December 31, 2005
(Canadian Dollars)
(Unaudited – Prepared by Management)
Three Months Ended | Six Months Ended | |||||||||||
June 30 | June 30 | |||||||||||
2006 | 2005 | 2006 | 2005 | |||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||
Revenues | $ | 3,258,201 | $ | 2,676,154 | $ | 6,936,922 | $ | 4,760,210 | ||||
Interest | 73,326 | 8,470 | 135,660 | 9,725 | ||||||||
3,331,527 | 2,684,624 | 7,072,582 | 4,769,935 | |||||||||
Expenses | ||||||||||||
Accounting and audit | 66,424 | 12,800 | 104,009 | 34,587 | ||||||||
Advertising and promotion | 1,899,659 | 1,006,807 | 3,441,676 | 1,753,776 | ||||||||
Amortization | 169,886 | 72,861 | 312,494 | 138,197 | ||||||||
Bank charges, interest and foreign exchange | 113,231 | 753 | 119,260 | 3,126 | ||||||||
Commission fees | 14,030 | 24,710 | 26,730 | 24,710 | ||||||||
Consulting and professional fees | 53,449 | 145,109 | 128,203 | 235,236 | ||||||||
Donations | 5,000 | 15,000 | 6,000 | 25,000 | ||||||||
Legal | 4,696 | 17,112 | 13,438 | 29,074 | ||||||||
Licensing fees | 29,904 | 16,552 | 47,206 | 16,552 | ||||||||
Management fees | 90,000 | 45,000 | 180,000 | 90,000 | ||||||||
Office | 160,903 | 108,324 | 269,260 | 153,140 | ||||||||
Regulatory and transfer agent fees | 2,112 | 23,411 | 3,582 | 25,509 | ||||||||
Rent | 181,641 | 97,829 | 318,632 | 176,454 | ||||||||
Salaries and benefits | 1,002,976 | 469,089 | 1,832,008 | 803,341 | ||||||||
Shareholder communication | 8,179 | 10,383 | 8,179 | 10,633 | ||||||||
Telephone | 21,464 | 16,936 | 38,774 | 26,313 | ||||||||
Transaction fees | 239,487 | 205,824 | 514,660 | 382,112 | ||||||||
Travel, meals and entertainment | 121,987 | 107,733 | 205,717 | 189,455 | ||||||||
4,185,028 | 2,396,233 | 7,569,828 | 4,117,215 | |||||||||
Gain/(loss) before other items | (853,501) | 288,391 | (497,246) | 652,720 | ||||||||
Other items | ||||||||||||
Write down of securities | - | - | 41,127 | - | ||||||||
Gain on settlement of debt | - | 97,382 | - | 97,382 | ||||||||
- | 97,382 | 41,1,27 | 97,382 | |||||||||
Net gain/(loss) for period | (853,501) | 385,773 | (538,373) | 750,102 | ||||||||
Deficit, beginning of period | (18,463,266) | (19,502,806) | (18,778,394) | (19,867,135) | ||||||||
Deficit, end of period | (19,316,767) | (19,117,033) | (19,316,767) | (19,117,033) | ||||||||
Weighted average number of shares | 97,203,825 | 77,925,844 | 97,203,825 | 77,925,844 | ||||||||
Net and fully diluted gain/(loss) per common share | (0.009) | 0.005 | (0.006) | 0.01 | ||||||||
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LAS VEGAS FROM HOME.COM ENTERTAINMENT INC.
Consolidated Statements of Cash Flows
Six Months Ended June 30
(Canadian Dollars)
(Unaudited – Prepared by Management)
Three Months ended | Six months ended | ||||||||
June 30 | June 30 | ||||||||
2006 | 2005 | 2006 | 2005 | ||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||
Cash provided by (used for) | |||||||||
Operations | |||||||||
Net gain/(loss) | $ | (853,501) | $ | 385,773 | $ | (538,373) | $ | 750,102 | |
Items not affecting cash | |||||||||
Amortization | 169,886 | 72,861 | 312,494 | 138,197 | |||||
Capitalization of deferred amortization on software development | - | 3,737 | - | 7,677 | |||||
Write down of securities | - | - | 41,127 | - | |||||
Foreign exchange | - | 7,377 | - | - | |||||
Stock-based compensation | 8,649 | 150,034 | 83,419 | 150,034 | |||||
Three card games software | (2,401,200) | - | (2,401,200) | - | |||||
Operating Cash Flow | (3,076,166) | 619,782 | (2,502,533) | 1,046,010 | |||||
| |||||||||
Changes in non-cash working capital: | |||||||||
Accounts receivable | (180,542) | 279,719 | 229,056 | (16,098) | |||||
Prepaids & security deposits | (2,686) | (732) | (18,117) | 86,897 | |||||
Due from related party | (727) | (132,636) | 4,013 | (259,453) | |||||
Accounts payable and accrued Liabilities | (182,914) | 260,919 | 42,038 | 180,416 | |||||
Due to related parties | (89,310) | (11,494) | (51,244) | (8,525) | |||||
(456,179) | 395,776 | 205,746 | (16,763) | ||||||
(3,532,345) | 1,015,558 | (2,296,787) | 1,029,247 | ||||||
Financing | |||||||||
Common shares issued net of issue costs | 2,448,360 | 888,280 | 2,588,075 | 1,791,000 | |||||
Capital subscriptions | - | 683,470 | - | 1,133,470 | |||||
Repayment of capital lease | (5,332) | (4,935) | (11,072) | (9,630) | |||||
Other obligations (loans payable) | - | (210,350) | - | (516,008) | |||||
2,443,028 | 1,356,465 | 2,577,003 | 2,398,832 | ||||||
Investing | |||||||||
Equipment | (531,205) | (541,960) | (541,812) | (565,927) | |||||
Proceeds on sale of marketable securities | (50,100) | - | 198,816 | - | |||||
Additions to software development | - | (235,236) | (130,976) | (470,357) | |||||
| (581,305) | (777,196) | (473,972) | (1,036,284) | |||||
Outflow of Cash | |||||||||
Increase in cash and cash equivalents | (1,670,622) | 1,594,827 | (193,756) | 2,391,795 | |||||
Cash and cash equivalents, beginning of period | 9,885,486 | 776,251 | 8,408,620 | (20,717) | |||||
Cash and cash equivalents, end of period | 8,214,864 | 2,371,078 | 8,214,864 | 2,371,078 | |||||
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About Las Vegas From Home.Com Entertainment Inc.
LVFH is an “E-Gaming” Software Developer and provider, and through its wholly owned Antiguan Subsidiary, Action Poker Gaming Inc., licenses its software to third parties.
For more Information on the Company, please contact us at (604) 681-0204, or visit our Website at www.lvfh.com .
On behalf of the Board of
Las Vegas From Home.com Entertainment Inc.
“Jacob H. Kalpakian”
_____________________________
Jacob H. Kalpakian,
President
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This release does not constitute an offer for sale of securities in the United States.
Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement in this release containing words such as "believes,” "plans," "expects" or "intends" and other statements that are not historical facts are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements. The Company disclaims any obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
LAS VEGAS FROM HOME.COM ENTERTAINMENT INC.
1st Floor, 1255 West Pender Street,
Vancouver, British Columbia V6E 2V1
Tel: (604) 681-0204
Fax: (604) 681-9428
Email:Info@lvfh.com
Website:www.lvfh.com