GOOD NEWS FROM SPORTINGBET

7 March 2008

UK gambling group's six month numbers are positive


The UK online gaming group Sportingbet plc swung back into profit in the first six months despite results going against it, reports Reuters news service, quoting the gambling group's chief executive Andrew McIver.

"With six months of the year completed we have achieved an operating profit of GBP 11.7 million versus GBP 4.0 million last year," said McIver. "This has not been achieved by especially favourable outcomes to sports events - the margin percentage is actually slightly lower than last year - but rather from strong growth in turnover from our core sports offering and careful cost control."

Net gaming revenue in the three months to end January jumped from GBP 34.4 million to GBP 41.2 million, making a total for the interim period of GBP 71.6 million, up from GBP 66.9 million. Pre-tax profits for the second quarter were GBP 3.6 million, versus GBP 100 000, to give a total interim profit of GBP 2.2 million compared with a loss of GBP 11.4 million.

In the second quarter, sports betting levels rose 29.6 percent year on year, casino was up 29.1 percent year on year and poker by 34.1 percent quarter on quarter, delivered through both incremental betting volumes (amounts wagered on sports in Europe up 35.3 percent year on year) and yields per player.

Big increases in revenues from Turkey and Australia underpin Sportingbet's pleasing numbers in Q2 of its interim period. Net gaming revenue in the Turkish market rose to GBP 10.6 million in the three months to the end of January, up GBP 4..6 million on the corresponding period in 2006.

In Australia, net gaming revenues rose from GBP 2.6 million to GBP 4.7 million over the same period.

Both helped push Sportingbet's operating profit for the period up 275 percent to GBP 7.5 million from GBP 1 million the previous year.

Revenue from the much vaunted and newly liberated Spanish market was static at GBP 7.2 million over the period while the total for the rest of Europe, including Britain, actually fell GBP 600 000 to GBP 18 million.

Sportingbet's COO David Hobday said the UK remained the “most competitive market in Europe”.

Hobday added that the results showed the company was succeeding in beginning to “act and think like an ecommerce retailer”.

In keeping with its goal of gaining full control of its operations in all its major markets, Sportingbet has acquired its Bulgarian marketing partner, Belmond International, for an initial consideration of GBP 4 million with a deferred element of up to GBP 7.2 million. The company said the Bulgarian operation was now its sixth biggest market.
The third quarter has started well, McIver said, though the fourth quarter will be dominated by the Euro 2008 football tournament, which could significantly influence Q4 results, he added.

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