Philweb posts net loss in Q2

Philweb Corp., the listed gaming company now owned by businessman Gregorio “Greggy” Araneta III, trimmed its net loss in the second quarter to P16 million from P69 million the previous year.

Dennis Valdes, president of Philweb, said the company was able to generate positive EBITDA (earnings before interest, taxes, depreciation and amortization) in the second quarter even as it still incurred a slight net loss. EBITDA stood at P7 million from April to June this year.

“So while we are still incuring a slight loss due to our depreciation and other noncash costs, we have turned the corner on cash flow. That’s important because it relieves management of a lot of cash pressure,” Valdes said.

He said the company is considering venturing into other segments of the business including offshore gaming, which has become popular.

“We are considering it, but we are also being very careful,” Valdes said.

“Our look at POGO showed that it is legal from a Philippine point of view, but less clear from certain jurisdictions where the licensee may operate. So while we continue to look at overseas markets, our primary consideration remains regulatory certainty in whatever jurisdiction we enter,” Valdes said.

As of the end of June, the company had increased its electronic gaming outlets to 52 operating sites from only 16 the previous year.

“One of the critical benchmarks for Philweb is to continue servicing additional outlets, which will then increase our revenues and lead us to profitability. Note also how we have increased our revenues while basically putting a lid of costs. These cost savings further drive a return to profitability,” Valdes said.

In December last year, Philweb received the greenlight from the Philippine Amusement and Gaming Corp. to offer its services as an electronic gaming system service provider to Pagcorlicensed gaming sites for electronic games.

While waiting for Pagcor’s green light last year, Philweb made new investments, bought new servers amounting to over P100 million.

As an accredited EGS service provider, Philweb can offer its software and other services to the operators of Pagcor-licensed gaming sites for electronic games.

Philweb remitted P2.1 billion to Pagcor in 2015, the last full year it operated before its contract with the regulator expired in 2016.