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Global Entertainment Reports 72% Revenue Growth in Q3

Revenues grew to $1,462,910 for the quarter ended September 30, 2002 as compared to $849,299 for the quarter ended September 30, 2001. Of this revenue, 65% is attributable to software royalties, which increased 47% year-on-year. The company continued to see major growth in special projects revenue which accounts for 16% of revenues year on year amounting to $295,836 for the quarter.

Gross profit margins for the period increased to $1,052,520 from $624,069, a 68% increase.

Global Entertainment CEO, Bryan Abboud, stated: "Although the market conditions are not optimal for the online gaming industry given competition and regulatory pressure, I am pleased with our ability to outperform our competitors. Through continued focus on sound management and fundamentals like revenue and profit growth, Global continues to enhance its position as an industry leader."

Earnings before Interest, taxes, depreciation & amortization (EBITDA) were positive at $171,239 for the 3 month period ended September 30, 2002 compared to a negative EBITDA for the three month period ended September 30, 2001 of $(53,150). For the nine months ended September 30, 2002, EBITDA was $511,653, compared to a negative EBITDA of $(6,181) for the nine month period ended September 30, 2001.

Quarterly net income was positive for the first time this year at $10,265. The loss for the nine months ended September 30, 2002 was $361,174 which marks a significant decrease from the same period loss last year of $875,887.

Operating expenses increased less than 50% relative to revenue growth. Total operating expenses for the quarter ended September 30, 2002 were $881,281, compared to $677,219 for the same period last year, a 30% increase. Total operating expenses for the nine months ended September 30, 2002 were $2,392,737, compared to $2,141,137 for the same period last year, a 12% increase.

Prevail, the gaming portal subsidiary, is still under recovery in a tough market for online advertising dollars. For the quarter ended September 30, 2002, Prevail generated revenues of $23,500, compared to $43,894 for the quarter ended September 30, 2001.

Although liquidity has been tight for the quarter, the company has been able to continue financing operations through internally generated cash-flow. In addition, the company reduced short-term debt by $475,614 so far this year. The company also decreased overall accounts receivable (both long term and short term) by $594,386 for the nine months ended September 30, 2002. Net cash generated from operating activities for the nine months ended September 30, 2002 was $1,268,648, compared to $514,217 for nine months ended September 30, 2001, a 47% improvement. The company continues to explore outside financing to support future growth plans.

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