BETDIRECT SALE IMPACTS 32RED NUMBERS

14 March 2008

London-listed online casino firm suffers increased pre-tax losses


The sale of the Betdirect sportsbetting operation has had an adverse impact on full year results for 2007 released by the 32Red online gambling group this week, the company says. Having racked up operating losses of GBP 6.7 million and a loss on disposal of GBP 7.3 million up to 10 December 2007, the sportsbetting operation was sold to UK bookie group Stan James for GBP 5.75 million in October 2007.

32Red bought the sportsbetting venue for GBP 12.5 million in June 2006.

The numbers for 2007 reflected the cost associated with the venture as pre-tax losses soared to GBP 12.9 million (2006: GBP 3.7 million)

The annual loss was “...a direct result of the poor performance of the Betdirect business and the subsequent write-down of tangible and intangible fixed assets to their realisable value following the sale” the company report asserted.

The good news for 32Red investors is that 2008 trading has been "encouraging" as the online casino group focuses on its core online casino, poker, bingo and mobile products in the competitive but growing UK market

“The sale of Betdirect has refocused the group on its core products and has in 2008 returned the group to a cash positive position," wrote 32Red CEO Ed Ware. "Management are focused on building growth, expanding our product range and moving into new territories through the 32Red brand. We have surpassed several important milestones in the first few weeks of 2008 and look forward with confidence to an exciting year.”

Operational pre-tax profits were down GBP 300 000 to GBP 1.36 million, and the number of active players across the group rose 17 percent to 33 745, with average acquisition costs falling to GBP 87 (2006: GBP 114) Player numbers were broken down as Casino: 18 992 (up 26.6 percent) and Poker : 14 753 (up 6.6 percent).

Online Casino News courtesy of InfoPowa