It's been a heck of a year for online-gambling software developer CryptoLogic (NASDAQ:CRYP). Let's just say it didn't exactly hit the jackpot.

After being given the boot by the Unlawful Gaming Enforcement Agency last year, the company was banned from all operations in the United States, which at the time accounted for 30% of its business. In response, CryptoLogic packed its bags, switched CEOs, and moved headquarters from Canada to Ireland in order to be closer to its remaining customer base. If you can't beat 'em, ditch 'em.

Nonetheless, CryptoLogic has not only survived, but also taken steps to reinvent itself and return to historical profitability. On Wednesday, CryptoLogic reported revenue for the past quarter of $17.5 million and net income of $2.4 million, or $0.19 per share. It also declared and stood by its $0.12-per-share dividend, which equates to a 2.5% yield. Not bad, considering the entire company moved halfway across the world in the past year.

Greener pastures ahead
CryptoLogic has taken steps in the past year to distance itself from it once coveted American customers, including making several acquisitions in Europe and Asia, such as and Mikoishi Studios, which focuses on the Asian mobile phone entertainment market. CryptoLogic also relocated its gambling license to the United Kingdom to better meet the needs of prospective new licensees.

Perhaps the most attractive aspect of CryptoLogic, setting it apart from competitors such as Gigamedia (NASDAQ:GIGM), is its Fort Knox-like balance sheet. CryptoLogic currently holds more than $85 million in cash and equivalents, a figure that accounts for more than 30% of its total market cap. With such a strong foundation, CryptoLogic remains well-heeled to maneuver around future bumps in the road. It may also be an attractive buyout candidate for larger gaming companies such as Boyd Gaming (NYSE:BYD).

Investors have also kept a close eye on value investing guru Mohnish Pabrai. At last count, he owned more than 13% of CryptoLogic's outstanding shares, but he's recently begun selling shares at a significant loss from his purchase price. Some speculated that Pabrai was wagering that the prohibition of online gaming in the United States would be overturned by a bill pushed by Congressman Barney Frank, essentially restoring CryptoLogic's lucrative American contracts. Pabrai's sales have some wondering whether he's given up on this possibility and no longer sees much value in Cryptologic.

Looking ahead, Foolish investors should watch for the successful integration of CryptoLogic's new European and Asian gaming units. Management forecasts fourth-quarter revenue to come in between $17.5 million and $18.5 million, and earnings between $2 million and $3 million.

Until then, check out this related Foolishness:

Fool contributor Morgan Housel does not own shares in any of the companies mentioned in this article. He appreciates your questions, comments, and complaints. GigaMedia is a Motley Fool Global Gains pick. The Fool's disclosure policy is all about investors writing for investors.