World Gaming Profits
By Earl
World Gaming plc (OTC BB: WGMGY) today posted its first

profitable quarter for the three-month period ending December 31,

2001. The Company also released preliminary results for its

eight-month period ending December 31, 2001. (For additional

notes to the financial statements please refer to the Company's

6-K filing with the U. S. Securities and Exchange Commission for

the periods ended September 30, 2001. Note that the Company has

changed its fiscal year end to December 31 from April 30, which

results in the eight-month stub period. All amounts are in U.S.


Total revenues for the fourth quarter were $6.6 million compared

to $6.4 million for the same period last year, representing an

increase of 1.9 per cent. Net income for the quarter ending

December 31, 2001, after including one-time redomiciling costs of

$438 thousand ($81 thousand in 2000), was $536 thousand or $0.02

per share compared to a net loss of $199 thousand or $0.01 per

share for the corresponding period last year - representing a

$735 thousand increase. Excluding the one time redomiciling

costs, net income for the fourth quarter was $974 thousand or

$0.03 per share.

It was recently determined that redomiciling costs, previously

capitalized, should be expensed in accordance with U.S. GAAP.

According to FASB SOP 98-5, these expenses should be charged

against income as incurred. This resulted in the Company

expensing $438 thousand in redomiciling costs, which included

$142 thousand that had been capitalized prior to the fourth


For the eight-month period ending December 31, 2001, revenues

were $12.1 million compared to $14.1 million for the same period

last year, representing a decrease of 14.0 per cent. Net loss for

the period after redomiciling costs was $2.2 million or $0.07 per

share compared to a net loss of $2.7 million or $0.08 per share

last year.

'The fourth quarter results demonstrate our ability to deliver on

our commitments to shareholders despite industry challenges like

payment processing,' said Mike Aymong, Chief Executive Officer of

World Gaming. 'Bringing sustained profitability to the Company

has been a major focus since the new management team assumed

control. While we are not finished yet, we are optimistic that we

have reached a turning point and are now well positioned to

continue delivering profitable growth.'

Gross margins rose from 76 per cent to 89 per cent in the

quarter, an increase of 13 percent, and from 72 per cent to 81

per cent for the eight-month period, an increase of 9 per cent,

respectively from the prior year, reflecting a more profitable

revenue mix.

Operating expenses excluding redomiciling costs decreased 5.0 per

cent during the fourth quarter and fell 9.8 per cent over the

eight-month period. This is the result of a significant reduction

in operating costs and marketing outlays. World Gaming expects

continued improvements in these areas over the course of fiscal


'We are pleased to have met projections set out in our guidance

in November 2001 after adjusting for redomiciling costs.' said

Rodney Davis, Chief Financial Officer and acting Chief Operating

Officer. 'At the same time, we have committed substantial

resources toward improving back office infrastructure, customer

capture rates, minimizing down time and sourcing alternative

payment methods.'

The Internet Gaming industry continues to be very attractive for

World Gaming, with high barriers to entry. World Gaming offers a

comprehensive suite of gaming products and provides its customers

with a complete turnkey solution in sportsbook, casino and

pari-mutuel. In 2002 World Gaming will expand its offering by

launching its products in a variety of new languages and

currencies to take advantage of the industry's rapid growth.

About World Gaming plc

World Gaming plc is a pioneer and leader in I-gaming software and

e-commerce technologies. World Gaming is an international

developer, licensor and provider of online gaming products,

including casino, sports book and pari-mutuel betting. For more

information about World Gaming, visit the company's Web site at

For World Gaming, please contact:

Media Relations: Investor Relations:

David Doze Chris Barnes / Réjane Wilson

Goodman Communications Inc. The Barnes Organization Inc.

416-924-9100, ext. 222 416-367-5000

Safe Harbor Statement under the Private Securities Litigation

Reform Act of 1995: The statements contained herein which are not

historical fact are forward-looking statements that are subject

to risks and uncertainties that could cause actual results to

differ materially from those expressed in the forward-looking

statements, including, but not limited to, certain delays in

testing, evaluation and deployment of products, fraud occasioned

upon licensees of World Gaming, regulation of the online gaming

industry, and other risks detailed from time to time in World

Gaming's filings with the Securities & Exchange Commission. We

assume no responsibility for the accuracy and completeness of

these statements and are under no duty to update any of the

forward-looking statements contained herein to conform these

statements to actual results. This is not an offer to sell or a

solicitation of an offer to purchase any securities.


World Gaming Plc

Consolidated Balance Sheets

(In thousands of US$)

December 31, 2001 April 30, 2001




Current assets

Cash and cash equivalents $ 2,206 $ 4,518

Reserves with credit card processors 2,532 3,763

Accounts receivable 2,625 1,535

Prepaid expenses and deposits 438 576

Deferred gaming license 109 300

Deferred financing costs 100 -

Current portion of employee advances 34 -

Restricted cash - 3,925


8,044 14,617

Capital assets (net) 4,133 5,239

Long-term employee advance 3 -

Long-term other asset - 332


$ 12,180 $ 20,188



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