Lottery Site 500.com Drops 10% as Loss Stays Level, Withholds Guidance
The stock of 500.com Ltd. (NYSE: WBAI) dropped Friday after the company, which operates sports lottery platforms, announced its loss in the second quarter stayed at $8 million, nearly level year-over-year.
On the day, 500.com saw its shares fall 10 percent to $13.22 per American depositary share.
The stock of 500.com fell 10 percent on Friday to $13.22 per share.
(Source: Thomson Reuters Eikon)
500.com's finances continued to suffer after Beijing released regulations in January 2015 which caused the company to suspend all online purchase orders for lottery products in China's provincial sports lottery centers. No revenue have come from these services since April 2015, 500.com said in its statement.
The company has pursued other ventures, however. A year ago, it acquired The Multi Group Ltd., a Maltese online lottery betting and online casino "with a significant market share in the Nordic countries."
Since March, 500.com has been developing physical channels for selling sports lottery tickets in several Chinese provinces in partnership with China Sports Lottery Administration Center.
On Friday, the company said revenue for the second quarter ended June 30 was $4.6 million, an increase of 561 percent from about $700,000 a year ago, thanks to the acquisition of the Maltese business.
Net loss during the same period was 8 million, inching up from $7.95 million reported for the second quarter last year. It did, however, decline by nearly 10 percent from the first three months of the year, the company said. it&`#`39;s loss per share was 19 cents, the same as a year ago.
As of June 30, the company had cash and cash equivalents of $74.2 million. In addition, a government subsidiary of $200,000 has been granted to 500.com, but is pending clearance. The company has received $555,000 in government grants overall during the first half of the year
The company noted that it would not release a guidance for upcoming quarters "until it receives clear instruction from the Ministry of Finance" as to when, and if, it can resume its suspended business.
"Since we voluntarily suspended our online lottery sales operations in April 2015, we have continued to engage in new and promising initiatives to increase our revenue base," the chief financial officer of 500.com, Zhengming Pan, said in a statement Friday.
"We will continue to look for opportunities to enhance shareholders&`#`39; value," he added.