Tuesday, October 03, 2006

CryptoLogic saw its shares tumble after the maker of Internet gambling
software said licensees of WagerLogic, its licensing unit, will no longer
take wagers from U.S.-based players. The company cited new legislation
expected to be signed Monday by President Bush that outlaws the processing
of financial transactions in the U.S. online gambling market. CryptoLogic
tried to take an upbeat view, saying it has spent five years shifting its
revenue base to European markets and that it's "positioned for long-term
profitability and growth." Investors weren't as optimistic, sending shares
of CryptoLogic sinking 27% to $16.10 in early trading. "While the new U.S.
developments will be a challenge for the whole industry, our company's
diversification, strong balance sheet, thriving European customers and
potential new business in emerging markets enable us to face the future with
confidence," the company said. More than 70% of its licensees' revenue now
comes from outside the U.S.