TORONTO, Nov. 9, 2017 /CNW/ - The Stars Group Inc.
(NASDAQ: TSG; TSX: TSGI) today reported its financial results for
the third quarter ended September 30,
2017, reconfirmed its full year 2017 financial guidance
ranges and provided certain additional highlights and updates.
Unless otherwise noted, all dollar ($) amounts are in U.S.
dollars.
"Our operations and management continued to perform in the third
quarter, delivering strong year-over-year growth bolstered by the
launch of Stars Rewards," said Rafi Ashkenazi, Chief Executive
Officer. "Not only did we see improvement in our poker business,
but our casino continues to grow with a significant active player
base and our online sportsbook continues to see meaningful growth
in turnover. To build upon these achievements, we plan to focus on
reinvesting in our core products and increasing our investment in
marketing for the remainder of 2017 and into 2018 while continuing
to explore further growth opportunities."
Third Quarter and Year-to-Date 2017 Financial
Summary(1)
|
|
Three Months Ended
September 30,
|
|
Year-
over-Year Change
|
|
Nine Months Ended
September 30,
|
|
Year-
over-Year Change
|
$000's, except
percentages and per share amounts
|
|
2017
|
|
2016
|
|
|
|
2017
|
|
2016
|
|
|
Total
Revenue
|
|
329,443
|
|
270,681
|
|
21.7%
|
|
952,065
|
|
844,961
|
|
12.7%
|
Adjusted
EBITDA
|
|
155,767
|
|
123,164
|
|
26.5%
|
|
453,305
|
|
376,489
|
|
20.4%
|
Net cash inflows from
operating activities
|
|
144,870
|
|
86,693
|
|
67.1%
|
|
370,843
|
|
201,641
|
|
83.9%
|
Adjusted Cash Flow
from Operations
|
|
141,986
|
|
84,976
|
|
67.1%
|
|
393,241
|
|
278,122
|
|
41.4%
|
Net
earnings
|
|
75,874
|
|
12,523
|
|
505.9%
|
|
212,110
|
|
90,511
|
|
134.3%
|
Adjusted Net
Earnings
|
|
119,595
|
|
84,979
|
|
40.7%
|
|
346,990
|
|
259,686
|
|
33.6%
|
Diluted earnings per
common share
|
|
$ 0.37
|
|
$ 0.06
|
|
516.7%
|
|
$ 1.05
|
|
$ 0.47
|
|
123.4%
|
Adjusted Net Earnings
per Diluted Share
|
|
$ 0.58
|
|
$ 0.42
|
|
38.1%
|
|
$ 1.71
|
|
$ 1.34
|
|
27.6%
|
__________________________________________________
(1)
For important information on The Stars Group's non-IFRS measures,
see below under "Non-IFRS and Non-U.S. GAAP Measures" and the
tables under "Reconciliation of Non-IFRS Measures to Nearest IFRS
Measures".
Third Quarter 2017 and Subsequent Financial
Highlights
- Revenues – Total revenues for the quarter increased
approximately 21.7% year-over-year. Excluding the impact of
year-over-year changes in foreign exchange rates, total revenues
for the quarter would have increased by approximately 16.8%.
Real-money online poker revenues and real-money online casino and
sportsbook combined revenues represented approximately 67.2% and
28.9% of total revenues for the quarter, respectively, as compared
to approximately 72.7% and 23.7% for the prior year
period.
- Poker Revenues – Real-money online poker revenues for
the quarter were $221.4 million, or
an increase of approximately 12.5% year-over-year. Excluding the
impact of year-over-year changes in foreign exchange rates,
real-money online poker revenues would have increased by
approximately 7.5% for the quarter. The year-over-year increase was
primarily driven by the implementation of the Stars Rewards
loyalty program.
- Casino & Sportsbook Revenues – Real-money online
casino and sportsbook combined revenues for the quarter were
$95.2 million, or an increase of
approximately 48.3% year-over-year. Excluding the impact of
year-over-year changes in foreign exchange rates, real-money online
casino and sportsbook combined revenues would have increased by
approximately 43.3% for the quarter.
- Debt – Total long-term debt outstanding at the end
of the quarter was $2.45 billion with
a weighted average interest rate of 4.7%. In mid-September, The
Stars Group prepaid without penalty an additional $75 million under its second lien term loan using
cash on its balance sheet and cash flow from operations. The
principal balance of the second lien term loan as of the date
hereof is $95 million.
Third Quarter 2017 and Subsequent Operational
Highlights
- Quarterly Real-Money Active Uniques (QAUs) – Total QAUs
were approximately 2.1 million, an increase of 2.1% year-over-year
led by the re-launch of PokerStars in Portugal in late 2016 and the growth and
expansion of The Stars Group's real-money online casino and
sportsbook offerings. Approximately 2.0 million of such QAUs played
online poker during the quarter, which remained virtually flat
year-over-year. The Stars Group's online casino offerings
had approximately 553,000 QAUs, an increase of 20.1%
year-over-year, which The Stars Group continues to estimate is one
of the largest casino player bases among its competitors, while its
emerging online sportsbook offerings had approximately 273,000
QAUs, a 14.8% increase year-over-year.
- Quarterly Net Yield (QNY) – Total QNY was $150, an increase of 18.8% year-over-year, and
QNY excluding the impact of year-over-year changes in foreign
exchanges rates was $144, an increase
of 13.9% year-over-year. QNY is a non-IFRS measure.
- Customer Registrations – Customer Registrations
increased by 2.0 million during the quarter to approximately 115
million.
- Launch of Stars Rewards – In July, The Stars Group
launched the Stars Rewards program, which is an integrated
cross-vertical loyalty program focused on customer engagement,
retention and experience. This program seeks to offer an exciting,
personalized gaming experience that rewards players for their
overall gameplay across poker, casino and sportsbook, in each case
where available. The Stars Group believes that Stars Rewards
has enhanced and will continue to enhance the player experience as
it introduces new ways of earning rewards that are intended to be
more exciting for its recreational players and distributes the
rewards based on, among other things, player contributions to the
overall ecosystem. To date, approximately 85% of active customers
have elected to participate in Stars Rewards and nearly
$45 million in prizes have been
awarded. The Stars Group believes the program has positively
impacted the overall product ecosystem across verticals and
continues to receive positive feedback from most players.
Full Year Guidance
- Full Year Guidance – The Stars Group reconfirmed its
2017 full year financial guidance ranges as previously announced on
September 15 and continues to expect
the following:
- Revenues of between $1,285
and $1,315 million;
- Adjusted EBITDA of between $590 and $610 million;
- Adjusted Net Earnings of between $445 and $469 million; and
- Adjusted Net Earnings per Diluted Share of between
$2.17 and $2.31.
These estimates reflect
management's view of current and future market and business
conditions, including assumptions of (i) negative operating
conditions in Poland primarily
related to constraints on processing payments in that jurisdiction,
the cessation of real-money online poker in Australia on September 11, 2017, and the
cessation of real-money online gaming in Colombia on July 17, 2017, (ii) the
introduction of Stars Rewards, (iii) no other material
adverse regulatory events and (iv) no material foreign
currency exchange rate fluctuations, particularly against the Euro,
which is the primary depositing currency of The Stars Group's
customers, that could impact customer purchasing power as it
relates to The Stars Group's U.S. dollar denominated product
offerings. Such guidance is also based on a Euro to U.S. dollar
exchange rate of 1.18 to 1.00 and all other currencies at their
average exchange rate for the month of August, in each case for the
remainder of 2017, unaudited expected results and certain
accounting assumptions.
Financial Statements, Management's Discussion and Analysis
and Additional Information; Internal Control Over Financial
Reporting
For an update regarding The Stars Group's internal control over
financial reporting, including its remediation efforts with respect
to the same, see "Disclosure Controls and Procedures and Internal
Control Over Financial Reporting" in The Stars Group's management's
discussion and analysis for the year ended December 31, 2016 (the "2016 MD&A") and in
The Stars Group's management's discussion and analysis for the
three and nine months ended September 30,
2017 (the "Q3 2017 MD&A").
The Stars Group's unaudited condensed consolidated financial
statements for the three and nine months ended September 30, 2017 (the "Q3 2017 Financial
Statements"), Q3 2017 MD&A and 2016 MD&A, as well as
additional information relating to The Stars Group and its
business, can be found on SEDAR at www.sedar.com, Edgar at
www.sec.gov and The Stars Group's website at
www.starsgroup.com.
In addition to press releases, securities filings and public
conference calls and webcasts, The Stars Group intends to use its
investor relations page on its website as a means of disclosing
material information to its investors and others and for complying
with its disclosure obligations under applicable securities laws.
Accordingly, investors and others should monitor the website in
addition to following The Stars Group's press releases, securities
filings and public conference calls and webcasts. This list may be
updated from time to time.
Conference Call and Webcast
The Stars Group will host a conference call today, November 9, 2017 at 8:30
a.m. ET to discuss its financial results for the third
quarter 2017 and related matters. To access via tele-conference,
please dial +1 855-327-6837 or +1 631-891-4304 ten minutes prior to
the scheduled start of the call. The playback will be made
available two hours after the event at +1 844-512-2921 or +1
412-317-6671. The Conference ID number is 10003774. To access the
webcast please use the following link:
http://public.viavid.com/index.php?id=127063
Reconciliation of Non-IFRS Measures to Nearest IFRS Measures
The table below presents reconciliations of Adjusted EBITDA,
Adjusted Net Earnings and Adjusted Net Earnings per Diluted Share
to net earnings, which is the nearest IFRS measure:
|
|
Three Months Ended
September 30,
|
|
|
Nine Months Ended
September 30,
|
$000's, except per
share amounts
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
Net
earnings
|
|
|
75,874
|
|
|
|
12,523
|
|
|
|
212,110
|
|
|
|
90,511
|
Financial
expenses
|
|
|
41,040
|
|
|
|
49,458
|
|
|
|
123,326
|
|
|
|
101,734
|
Income taxes expense
(recovery)
|
|
|
2,186
|
|
|
|
(400)
|
|
|
|
856
|
|
|
|
4,078
|
Depreciation of
property and equipment
|
|
|
2,178
|
|
|
|
2,119
|
|
|
|
6,555
|
|
|
|
6,109
|
Amortization of
intangible and deferred development costs
|
|
|
34,453
|
|
|
|
33,326
|
|
|
|
102,411
|
|
|
|
96,919
|
EBITDA
|
|
|
155,731
|
|
|
|
97,026
|
|
|
|
445,258
|
|
|
|
299,351
|
Stock-based
compensation
|
|
|
3,298
|
|
|
|
1,978
|
|
|
|
7,914
|
|
|
|
8,396
|
Termination of
employment agreements
|
|
|
1,357
|
|
|
|
3,047
|
|
|
|
4,165
|
|
|
|
11,365
|
Termination of
affiliate agreements
|
|
|
—
|
|
|
|
1,053
|
|
|
|
407
|
|
|
|
3,386
|
Loss on disposal of
assets
|
|
|
338
|
|
|
|
246
|
|
|
|
599
|
|
|
|
562
|
(Gain) loss from
investments
|
|
|
(9,024)
|
|
|
|
10,589
|
|
|
|
(14,236)
|
|
|
|
14,550
|
Acquisition-related
costs
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
199
|
Net loss (earnings)
from associates and (reversal of) impairment of assets held for
sale, associates and intangible assets
|
|
|
1,451
|
|
|
|
574
|
|
|
|
(5,861)
|
|
|
|
6,641
|
Other costs (see
table below)
|
|
|
2,616
|
|
|
|
8,651
|
|
|
|
15,059
|
|
|
|
32,039
|
Adjusted
EBITDA
|
|
|
155,767
|
|
|
|
123,164
|
|
|
|
453,305
|
|
|
|
376,489
|
Current income tax
expense
|
|
|
(3,288)
|
|
|
|
(342)
|
|
|
|
(6,690)
|
|
|
|
(5,814)
|
Depreciation and
amortization (excluding amortization of purchase price allocation
intangibles)
|
|
|
(5,556)
|
|
|
|
(4,369)
|
|
|
|
(15,740)
|
|
|
|
(12,359)
|
Interest (excluding
interest accretion and non-refundable late payment fees related to
the unpaid balance of the deferred purchase price)
|
|
|
(27,328)
|
|
|
|
(33,474)
|
|
|
|
(83,885)
|
|
|
|
(98,630)
|
Adjusted Net
Earnings
|
|
|
119,595
|
|
|
|
84,979
|
|
|
|
346,990
|
|
|
|
259,686
|
Diluted
Shares
|
|
|
204,800,009
|
|
|
|
200,016,913
|
|
|
|
202,796,952
|
|
|
|
193,866,395
|
Adjusted Net
Earnings per Diluted Share
|
|
|
$0.58
|
|
|
|
$0.42
|
|
|
|
$1.71
|
|
|
|
$1.34
|
The table below presents certain items comprising "Other costs"
in the reconciliation table above:
|
|
Three Months Ended
September 30,
|
|
|
Nine Months Ended
September 30,
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
|
$000's
|
|
|
$000's
|
|
|
$000's
|
|
|
$000's
|
Non-U.S. lobbying and
legal expenses
|
|
|
797
|
|
|
|
476
|
|
|
|
2,622
|
|
|
|
2,300
|
U.S. lobbying and
legal expenses
|
|
|
2,119
|
|
|
|
2,336
|
|
|
|
9,612
|
|
|
|
9,163
|
Strategic review
professional fees
|
|
|
—
|
|
|
|
2,237
|
|
|
|
125
|
|
|
|
7,372
|
Retention
bonuses
|
|
|
41
|
|
|
|
437
|
|
|
|
1,271
|
|
|
|
2,657
|
Non-recurring
professional fees
|
|
|
664
|
|
|
|
413
|
|
|
|
2,168
|
|
|
|
4,833
|
AMF and other
investigation professional fees (net of insurance
proceeds)
|
|
|
(1,265)
|
|
|
|
2,587
|
|
|
|
3,888
|
|
|
|
4,492
|
Austria gaming
duty
|
|
|
—
|
|
|
|
—
|
|
|
|
(5,000)
|
|
|
|
—
|
Office restructuring
and legacy business unit shutdown
costs
|
|
|
260
|
|
|
|
165
|
|
|
|
373
|
|
|
|
1,222
|
Other
costs
|
|
|
2,616
|
|
|
|
8,651
|
|
|
|
15,059
|
|
|
|
32,039
|
The table below presents a reconciliation of Adjusted Cash Flow
from Operations to net cash inflows from operating activities,
which is the nearest IFRS measure:
|
Three Months Ended
September 30,
|
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
$000's
|
|
|
$000's
|
|
|
$000's
|
|
|
$000's
|
Net cash inflows from
operating activities
|
|
144,870
|
|
|
|
86,693
|
|
|
|
370,843
|
|
|
|
201,641
|
Customer deposit
liability movement
|
|
(2,884)
|
|
|
|
(1,717)
|
|
|
|
22,398
|
|
|
|
76,481
|
Adjusted Cash Flow
from Operations
|
|
141,986
|
|
|
|
84,976
|
|
|
|
393,241
|
|
|
|
278,122
|
The table below presents a reconciliation of the numerator of
QNY (i.e., real-money online poker revenue and real-money online
casino and sportsbook combined revenue) to the nearest IFRS measure
(i.e., total revenue) as reported for the applicable period. Unless
otherwise noted, any deviation in the reconciliation below to
measures presented herein may be the result of immaterial
adjustments made in later periods due to certain accounting
reallocations.
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September,
|
|
|
2017
|
|
|
2016
|
|
|
$000's
|
|
|
$000's
|
Total
revenue
|
|
|
329,443
|
|
|
|
270,681
|
Corporate
revenue
|
|
|
(213)
|
|
|
|
—
|
Other gaming
revenue
|
|
|
(12,675)
|
|
|
|
(9,632)
|
Real-money online
poker revenue and real-money online casino
and sportsbook
combined revenue
|
|
|
316,555
|
|
|
|
261,049
|
The Stars Group has not provided a reconciliation of the
non-IFRS measures to the nearest IFRS measures included in its full
year 2017 financial guidance provided in this release, including
Adjusted EBITDA, Adjusted Net Earnings and Adjusted Net Earnings
per Diluted Share, because certain reconciling items necessary to
accurately project such IFRS measures, particularly net earnings
(loss), cannot be reasonably projected due to a number of factors,
including variability from potential foreign exchange fluctuations
impacting financial expenses, and the nature of other non-recurring
or one-time costs (which are excluded from non-IFRS measures but
included in net earnings (loss)), as well as the typical
variability arising from the audit of annual financial statements,
including, without limitation, certain income tax provision
accounting, and related accounting matters.
For additional information on The Stars Group's non-IFRS
measures, see below and the Q3 2017 MD&A, including under the
headings "Management's Discussion and Analysis" and "Selected
Financial Information—Other Financial Information".
About The Stars Group
The Stars Group is a leading provider of technology-based
products and services in the global gaming and interactive
entertainment industries. Through its Stars Interactive Group
division, The Stars Group ultimately owns gaming and related
consumer businesses and brands, including PokerStars, PokerStars
Casino, BetStars, Full Tilt, StarsDraft, and the PokerStars
Championship, PokerStars Festival and PokerStars Megastack live
poker tour brands (incorporating aspects of the European Poker
Tour, PokerStars Caribbean Adventure, Latin American Poker Tour and
the Asia Pacific Poker Tour). These brands together have more than
115 million registered customers globally and collectively form the
largest poker business in the world, comprising online poker games
and tournaments, sponsored live poker competitions, marketing
arrangements for branded poker rooms in popular casinos in major
cities around the world, and poker programming and content created
for television and online audiences. The Stars Group, through
certain of these brands, also offers non-poker gaming products,
including casino, sportsbook and daily fantasy sports. The Stars
Group, through certain of its subsidiaries, is licensed or approved
to offer, or offers under third party licenses or approvals, its
products and services in various jurisdictions throughout the
world, including in Europe, both
within and outside of the European Union, the Americas and
elsewhere. In particular, PokerStars is the world's most licensed
online gaming brand, holding licenses or related operating
approvals in 17 jurisdictions.
Cautionary Note Regarding Forward Looking Statements
This news release contains forward-looking statements and
information within the meaning of the Private Securities Litigation
Reform Act of 1995 and applicable securities laws, including,
without limitation, certain financial and operational expectations
and projections, such as full year 2017 financial guidance, and
certain future operational and growth plans and strategies.
Forward-looking statements and information can, but may not always,
be identified by the use of words such as "anticipate", "plan",
"continue", "estimate", "expect", "may", "will", "project",
"predict", "potential", "targeting", "intend", "could", "might",
"would", "should", "believe", "objective", "ongoing", "imply" and
similar references to future periods or the negatives of these
words and expressions. These statements and information, other than
statements of historical fact, are based on management's current
expectations and are subject to a number of risks, uncertainties,
and assumptions, including market and economic conditions, business
prospects or opportunities, future plans and strategies,
projections, technological developments, anticipated events and
trends and regulatory changes that affect us, our subsidiaries, and
our and their customers and industries. Although The Stars Group
and management believe the expectations reflected in such
forward-looking statements and information are reasonable and are
based on reasonable assumptions and estimates as of the date
hereof, there can be no assurance that these assumptions or
estimates are accurate or that any of these expectations will prove
accurate. Forward-looking statements and information are inherently
subject to significant business, regulatory, economic and
competitive risks, uncertainties and contingencies that could cause
actual events to differ materially from those expressed or implied
in such statements. Specific risks and uncertainties include, but
are not limited to: the heavily regulated industry in which The
Stars Group carries on business; interactive entertainment and
online and mobile gaming generally; current and future laws or
regulations and new interpretations of existing laws or regulations
with respect to interactive entertainment or online and mobile
gaming; potential changes to the gaming regulatory framework; legal
and regulatory requirements; ability to obtain, maintain and comply
with all applicable and required licenses, permits and
certifications to distribute and market its products and services,
including difficulties or delays in the same; significant barriers
to entry; competition and the competitive environment within The
Stars Group's addressable markets and industries; impact of
inability to complete future acquisitions or to integrate
businesses successfully; risks associated with advancements in
technology, including artificial intelligence; ability to develop
and enhance existing products and services and new commercially
viable products and services; ability to mitigate foreign exchange
and currency risks; ability to mitigate tax risks and adverse tax
consequences, including, without limitation, the imposition of new
or additional taxes, such as value-added and point of consumption
taxes, and gaming duties; risks of foreign operations generally;
protection of proprietary technology and intellectual property
rights; ability to recruit and retain management and other
qualified personnel, including key technical, sales and marketing
personnel; defects in The Stars Group's products or services;
losses due to fraudulent activities; management of growth; contract
awards; potential financial opportunities in addressable markets
and with respect to individual contracts; ability of technology
infrastructure to meet applicable demand; systems, networks,
telecommunications or service disruptions or failures or
cyber-attacks; regulations and laws that may be adopted with
respect to the Internet and electronic commerce or that may
otherwise impact The Stars Group in the jurisdictions where it is
currently doing business or intends to do business; ability to
obtain additional financing on reasonable terms or at all;
refinancing risks; customer and operator preferences and changes in
the economy; dependency on customers' acceptance of its products
and services; consolidation within the gaming industry; litigation
costs and outcomes; expansion within existing and into new markets;
relationships with vendors and distributors; and natural events.
Other applicable risks and uncertainties include, but are not
limited to, those identified in The Stars Group's Annual
Information Form for the year ended December
31, 2016, including under the heading "Risk Factors and
Uncertainties", and in the Q3 2017 MD&A, including under the
headings "Risk Factors and Uncertainties", "Limitations of Key
Metrics and Other Data" and "Key Metrics", each available on SEDAR
at www.sedar.com, EDGAR at www.sec.gov and The Stars Group's
website at www.starsgroup.com, and in other filings that The Stars
Group has made and may make with applicable securities authorities
in the future. Investors are cautioned not to put undue reliance on
forward-looking statements or information. Any forward-looking
statement or information speaks only as of the date hereof, and The
Stars Group undertakes no obligation to correct or update any
forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
Non-IFRS and Non-U.S. GAAP Measures
This news release references non-IFRS and non-U.S. GAAP
financial measures, including QNY, Adjusted EBITDA, Adjusted Cash
Flow from Operations, Adjusted Net Earnings, Adjusted Net Earnings
per Diluted Share, and the foreign exchange impact on revenues
(i.e., constant currency). The Stars Group believes these non-IFRS
and non-U.S. GAAP financial measures will provide investors with
useful supplemental information about the financial performance of
its business, enable comparison of financial results between
periods where certain items may vary independent of business
performance, and allow for greater transparency with respect to key
metrics used by management in operating its business.
Although management believes these financial measures are important
in evaluating The Stars Group, they are not intended to be
considered in isolation or as a substitute for, or superior to,
financial information prepared and presented in accordance with
IFRS or U.S. GAAP. They are not recognized measures under IFRS or
U.S. GAAP and do not have standardized meanings prescribed by IFRS
or U.S. GAAP. These measures may be different from non-IFRS and
non-U.S. GAAP financial measures used by other companies, limiting
its usefulness for comparison purposes. Moreover, presentation of
certain of these measures is provided for year-over-year comparison
purposes, and investors should be cautioned that the effect of the
adjustments thereto provided herein have an actual effect on The
Stars Group's operating results. In addition to QNY, which is
defined below under "Key Metrics and Other Data", The Stars Group
uses the following non-IFRS and non-U.S. GAAP measures in this
release:
Adjusted EBITDA means net earnings (loss) before interest and
financing costs, income taxes, depreciation and amortization,
stock-based compensation, restructuring and certain other
items.
Adjusted Cash Flow from Operations means net cash inflows
(outflows) from operating activities net of customer deposit
liability movements, and which The Stars Group first introduced for
the quarter ended June 30, 2017.
Adjusted Net Earnings means net earnings (loss) before interest
accretion, amortization of intangible assets resulting from
purchase price allocation following acquisitions, deferred income
taxes, stock-based compensation, restructuring, foreign exchange,
and certain other items.
Adjusted Net Earnings per Diluted Share means Adjusted Net
Earnings divided by Diluted Shares. Diluted Shares means the
weighted average number of common shares on a fully diluted basis,
including options, other equity-based awards, warrants and
convertible preferred shares. The effects of anti-dilutive
potential common shares are ignored in calculating Diluted Shares.
See note 6 to the Q3 2017 Financial Statements. For the three
and nine months ended September 30,
2017, Diluted Shares equaled 204,800,009 and 202,796,952,
respectively. For the purposes of the full year 2017 financial
guidance provided in this release, Diluted Shares equals between
203,000,000 and 205,000,000 for the high and low ends of the
Adjusted Net Earnings per Diluted Share range, respectively.
To calculate revenue on a constant currency basis, The Stars
Group translated revenue for the three months ended September 30, 2017 using the prior year's monthly
exchange rates for its local currencies other than the U.S. dollar,
which The Stars Group believes is a useful metric that facilitates
comparison to its historical performance.
For additional information on The Stars Group's non-IFRS
measures, see the Q3 2017 MD&A, including under the headings
"Management's Discussion and Analysis" and "Selected Financial
Information—Other Financial Information".
Key Metrics and Other Data
The Stars Group defines QAUs as active unique customers
(online, mobile and desktop client) who (i) made a deposit or
transferred funds into their real-money account with The Stars
Group at any time, and (ii) generated real-money rake or placed a
real-money bet or wager on or through one of its real-money online
poker, casino or sportsbook offerings during the applicable
quarterly period. The Stars Group defines unique as a customer who
played at least once on one of its real-money offerings during the
period, and excludes duplicate counting, even if that customer is
active across multiple verticals (e.g., both poker and
casino). The definition of QAUs excludes customer activity
from certain low-stakes, non-raked real-money poker games, but
includes real-money activity by customers using funds (cash and
cash equivalents) deposited by The Stars Group into such customers'
previously funded accounts as promotions to increase their lifetime
value.
The Stars Group defines QNY as combined real-money online gaming
and related revenue (excluding certain other revenues, such as
revenues that are included in "other gaming" revenues) for its two
business lines (i.e., real-money online poker and real-money online
casino and sportsbook) as reported during the applicable quarterly
period (or as adjusted to the extent any accounting reallocations
are made in later periods) divided by the total QAUs during the
same period. The Stars Group provides QNY on a U.S. dollar and
constant currency basis. QNY is a non-IFRS measure.
The Stars Group defines Customer Registrations as the cumulative
number of online real-money and play-money customer registrations
on The Stars Group's brands.
For additional information on The Stars Group's key metrics and
other data, see the Q3 2017 MD&A, including under the headings
"Limitations of Key Metrics and Other Data" and "Key Metrics".
SOURCE The Stars Group Inc.