32Red Plc, the award-winning online casino, poker and bingo operator today provides an update on current trading.
As noted in its interim results statement, player activity levels continue to be strong with the number of active casino players in Q3 up 16% on Q3 2008. This growth in activity levels is partially offset by reduced player yields as high roller activity continues to be suppressed. The Board now considers that it is unlikely that the Company will see sufficient growth in player yields in the second half of the year to be able to overcome the effect of the challenging trading conditions experienced in the first half of 2009. The Company continues to make significant investment in attractively priced marketing opportunities in order to recruit new players at reduced cost per acquisition levels. As a result of these factors and an unusually high level of customer wins in October the Board now believes that profit for the full year will be significantly below market expectations.
Quarter 3 revenues were the highest ever experienced by the Group and were up 11% on the corresponding period in 2008 and up 24% on Q2 2009. This strong performance reflects the continued growth in the 32Red casino with Quarter 3 revenues up 10% on the corresponding period in 2008 and up 21% on Q2 2009.
Quarter 4 trading has started well, although Casino gross win for October has been adversely affected by winning high roller players. Activity levels remain buoyant and the Company continues to invest in attractive and increasingly cost-effective UK marketing opportunities. A reduction in marketing spend has been considered in order to maintain the Company's short-term profitability, but the Board has concluded that this would not be in the best interests of the Company. The Board remains confident that the significant ongoing investment in marketing and in new technology during the year positions the Company well for 2010 and beyond.
30 October 2009
Tel: 00 350 200 49396
Ed Ware, CEO
Jon Hale, Finance Director
Numis Securities Lee Aston, NOMAD
Chris Wilkinson, Corporate Broking
College Hill Associates
Tel: 020 7260 1000
Tel: 020 7457 2020
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