UNIBET Q3 AND YTD RESULTS A MIXED BAG

7 November 2008

Gross win and EBITDA rise, bur pre-tax profits decline

 

The major European online gambling group Unibet delivered a mixed third quarter and year-to-date result this week, showcasing rising EBITDA and gross win revenues, but reduced pre-tax profits.

Gross win revenues rose to GBP 29.3 million (Q3 2007: GBP 19.4 million) and over the nine months to GBP 88.5 million (2007: GBP 56.9 million) Earnings before interest, tax, depreciation and amortisation (EBITDA) were also up at GBP 9.8 million (Q3 2007: GBP 8.2 million) and over the year to September reached GBP 31 million (2007: GBP 19.8 million)

However, pre-tax profits shrunk in Q3 to GBP 4.5 million (Q3 2007: GBP 6.9 million) and over the nine months to September to GBP 11.4 million compared to the same period in 2007 when pre-tax profits stood at GBP 17.4 million.

The company reported the following highlights:

* Unibet repurchased Euro 17 million of the Euro 100 million bond it took out at the end of 2007 to acquire Maria Bingo, and notes that the company bought an additional Euro 6 million of the bond since the start of October 2008, leaving the total outstanding on the bond at Euro 80.4 milion.

* The company is in a stronger cash position with GBP 42.3 million in cash at the end of September. However, once GBP 62.5 million is deducted from the balance sheet for the Maria Bingo bond, Unibet will be down to GBP 12.2 million of debt, compared with GBP 7 million at this time last year.

Breaking the results down by category, sports betting gross win grew to GBP10.5 million (Q3 2007: GBP 7.3 million) and to a nine month total of GBP 32 million, (2007: GBP 22 million) Margins were up 2.2 percent on the quarter to 10 percent. After bonuses, gross margins were 6.4 percent, compared with 5.3 percent the year previous. Live betting accounted for 20.2 percent of gross win revenue excluding bonuses, compared with 7.3 percent last year.

Operating costs in the third quarter rose significantly to GBP 18.8 million (2007: GBP10.9 million), although marketing investment remained steady at GBP 4.7 million. Salaries rose to GBP 4.9 million, up by GBP 1.5 million on the previous year. Looking at the same categories for the period January to September 2008, operating costs were GBP 55.9 million (2007: GBP 36.2 million); Marketing expenditure GBP 18 million (2007: GBP 14.7 million) and salaries GBP 13.5 million (2007: GBP 10 million).

Operating profits for Q3 showed a slight improvement at GBP 7.3 million (Q3 2007: GBP 7.1 million). Over the nine months to end September operating profits reched GBP 23.7 million - a marked improvements on the GBP 17/7 million achieved in 2007.

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