Trans World Corporation Announces 2013 First Quarter Financial Results

Trans World Corporation ("TWC” or the "Company”) (OTC: TWOC), a premier owner and operator of casinos and a hotel in Europe, today reported financial results for the first quarter ended March 31, 2013.

Mr. Rami Ramadan, Chief Executive Officer, commented, "Our first quarter results reflected the negative impact of the severe winter weather that plagued Europe during the first part of the year. The economic loss was widespread and affected businesses throughout the continent. As a result of these conditions, roads were frequently unsafe or closed, and our customers were unable to visit our casinos, thereby contributing to the reduction in the overall gaming revenue for the quarter. However, despite this challenge, TWC reported a profitable quarter, due to our continued commitment to enhancing operations at each casino and at the hotel. Despite a challenging start, our outlook remains positive for the remainder of the year.”

Financial and Operational Review

First quarter revenue from TWC’s continuing operations was approximately $8.2 million, compared with approximately $9.2 million for the same quarter in the prior year.

In the first quarter, consolidated live game attendance decreased by 10.5%, as the majority of the Company’s live game players were hampered by the inclement weather in their commute to TWC’s casinos. As for the slot game attendance, despite the travel difficulties, the casinos experienced a 24.7% increase in slot attendance, and management believes that, given the growth trend in the Company’s slot business, the slot game attendance would have been significantly higher without the setback due to the weather. The 6.9% increase in drop per head reflected a combination of pent-up demand, the success of the Company’s promotional programs, including the Player Loyalty programs, and a general improvement in the quality of players. In addition, room occupancy at the Hotel Savannah improved by 6.8 percentage points and total hotel revenue improved by 5.8% compared with the first quarter of 2012, thanks to an increased demand for discounted room packages.

Income from continuing operations before income taxes for the first quarter of 2013 decreased to approximately $441,000, compared with approximately $877,000 for the same quarter in 2012, largely from the reduced revenue base, while income from continuing operations, after a provision for foreign income taxes of $173,000, was $268,000, or $0.03 per diluted share, compared with approximately $503,000, or $0.06 per diluted share, after a provision of $374,000 for foreign income taxes, for the same quarter of the prior year. The reduction in the provision for foreign income taxes was contributed by both a credit adjustment of $73,000 related to the actual 2012 foreign income tax filing and a lower taxable income base in the first quarter of 2013 versus the same prior year quarter.

As a result of lower revenues due to the severe winter, EBITDA from continuing operations in the first quarter fell from approximately $1.4 million in the prior-year to $860,000 for the first quarter of 2013. A table reconciling EBITDA, a non-GAAP (Generally Accepted Accounting Principles) financial measure, to the appropriate GAAP measure is included with the Company’s financial information below.

Balance Sheet Highlights

The Company had cash of approximately $5.5 million at March 31, 2013 compared with approximately $6.9 million at December 31, 2012. At March 31, 2013, stockholders’ equity was approximately $39.5 million, or $4.36 per diluted share, down from approximately $41.2 million, or $4.56 per diluted share, at December 31, 2012. The reduction in stockholders’ equity at March 31, 2013 was attributable to the strength of the US dollar versus the primary currency of our foreign subsidiaries.

Conference Call

The Company will discuss these results in a conference call today at 2:00 PM ET.

The conference call will also be webcast live via the Investor Relations section of Trans World’s website at www.transwc.com, or by clicking the following link: http://transwc.equisolvewebcast.com/q1-2013

About Trans World Corporation

Trans World Corporation, founded in 1993, is a publicly traded, US corporation with all of its gaming and hotel operations in Europe. Additional information about TWC and its Czech subsidiaries, American Chance Casinos and Hotel Savannah, can be found at www.transwc.com, www.american-chance-casinos.com and www.hotel-savannah.com.

The press release herein contains certain forward-looking statements and data. For this purpose, any statements and data contained herein that are not historical fact may be deemed to be forward-looking data. Without limiting the foregoing, words such as "may,” "will,” "expect,” "believe,” "anticipates,” "estimates,” or "continue” or comparable terminology or the negative thereof are intended to identify certain forward-looking statements. These statements, by their nature, involve substantial risks and uncertainties, both known and unknown, and actual results may differ materially from any future results expressed or implied by such forward-looking statements. The company undertakes no obligation to publicly update or revise any forward-looking statements or data whether as a result of new information, future events or otherwise.

Reconciliation of Non-GAAP Measures to GAAP

The below table reconciles EBITDA, a non-GAAP (Generally Accepted Accounting Principles) financial measure, to the appropriate GAAP measure. The Company believes that EBITDA, a non-GAAP financial measure, provides useful information to its investors as well as to others who might be interested in purchasing shares of TWC common stock. This belief is based on conversations and meetings TWC’s management has had with its investors where the substance of these talks has centered around historical and prospective EBITDA measurements. Based on management’s observations, it appears that, even though the EBITDA measurement is not "GAAP,” it does enhance investors’ understanding of the Company’s business. In short, this performance measurement gives an analytic view of the Company’s operational earnings on a cash-basis, excluding the impact of debt obligations and (non-cash) depreciation and amortization.