Earlier this year, the AIM-quoted company decided to sell off its Center Point Development Corp games delivery platform, which had been dogged by various issues ever since it was acquired back in August 2015.
It also fell out with former chief executive Nick Bryant, who was axed back in March after the service contract with Electric Warrior Ltd, which provided Bryant’s services as CEO, was terminated.
An employment tribunal is reviewing the case while the group is also in discussions with Bryant’s representatives to settle the dispute.
In the six months to the end of September, it made a loss of US$588,332, which was not altogether surprising as it had zero revenues in the period; on the plus side, the loss narrowed from a loss of US$745,766 in the first half of 2016.
So, that’s the bad news out of the way; why is the management upbeat?
READ: PCG Entertainment shares jump as it names Robert McDowall to its board of directors with immediate effect
The company still has several licences for operating games and other media content in the potentially lucrative market of China and it is still looking to exploit these opportunities.
On top of that, PCG also retains a gambling licence from the Kahnawake Gaming Commission of the Mohawk Council of the Kahnawake Nation; this was recently renewed.
At the end of September, the group had a cash balance of US$1.97mln, up from US$60,502 at the end of June 2016 (the group has changed its financial year-end), after raising £1mln in August from a syndicate of institutional investors.
Perhaps most importantly of all, it has strengthened the board and has plenty of veterans among its directors who have turned companies around before.
“This has been a difficult year,” chairman Richard Poulden is on record as admitting.
“From the moment we knew we had a deal to divest CPDC, the board and I began to consider ways forward for the company to provide value for shareholders.
“Some of the directors of PCGE have done this before with quoted companies at the bottom of a cycle: Sirius Minerals and Wishbone Gold for example,” he noted.
The most recent addition to the board was Robert McDowall, who has more than 40 years of experience in the banking, securities and investment business, with companies such as Merrill Lynch, Pru-Bache and Singer and Friedlander.
The shares rose more than 20% on McDowall’s appointment, so make of that what you will.
Thus far, all we know is that the management team continues to examine potential additional deals across geographies and sectors.