MORE CUSTOMERS, BETTER REVENUES FOR PROBABILITY

26 October 2007

Mobile gambling specialist achieves maiden operating profit


Second quarter results for UK mobile gambling provider Probability plc showcase a maiden operating profit in September 2007, and increased revenues and player signups.

Key performance indicators released by CEO Charles Cohen disclose that VIP customers played a role in Probability achieving its maiden profitability numbers.

The company reported net gaming revenues up a creditable 34 percent to GBP 675 413 (Q1 2007: GBP 503 607) and a 15 percent increase in new customer signups of 29 914, bringing the client base to 228 902.

Probability has cash reserves totalling GBP 1.1 million.

The growth in player numbers created favourable results, but performance in the last two months of the second quarter was additionally enhanced by the introduction in July of an invitation-only VIP area for mobile Casino customers, branded "The Private Room at Lady Luck's". Net gaming revenues of over GBP 20 000 per VIP are not unusual in this area, Cohen reports, with an average to date of GBP 1 500 across all VIPs. Retention of these higher spending customers is currently greater than for non-VIPs.

Growth of the high margin bingo and slots segment has continued to improve gross margin in the company's activities during the quarter. Cross-selling of casino game formats to bingo and slots players has been improved and continues to support the growth in net gaming revenues.

Cohen takes a confident but cautious view of the immediate future. "Having achieved its first month of profitable trading in September, the company remains focused on attaining stable revenue growth from a fixed cost base," he said. "The business remains subject to the natural volatility of gambling revenues, and therefore does not at this time consider it prudent to revise medium term earnings expectations."

Probability has experienced good trading in October, and hopes to benefit from additional revenues during the coming quarter from the partnership announced in August with Blue Square, the on-line betting and gaming division of Rank Group plc. Under this agreement, all Blue Square customers will be able to play Roulette, Blackjack and other games supplied by Probability on their mobiles using their existing Blue Square account. Probability will receive a share of gaming revenues generated.

Probability plc listed on AIM in August 2006 and the company is licensed in Alderney. Its proprietary technology delivers an integrated portfolio of casino, bingo and slots entertainment to players using over 2 800 models of mobile phone. The firm's mobile e-wallet, certified by the FSA, handles all payments for customers.

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