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8 Jul 2008 07:00
8 July 2008
PartyGaming Plc
Pre-close trading Update
Since 28 April 2008 gross revenues have, as expected, fallen slightly due to seasonality and competition for players' leisure time from the Euro 2008 football tournament. Casino has continued to perform strongly but this was offset by a weaker than expected performance in poker and sports betting with overall revenues slightly lower than expected. However, operational efficiencies and lower marketing costs mean that Clean EBITDA margins in the first half are expected to be substantially higher than in the comparable period in 2007.
The strong performance in casino has been driven by an increase in the number of players and cross-selling from poker. Since their launch in May, two new branded slot machines, Mission:Impossible and Saturday Night Fever, have proved particularly popular and bingo is now starting to gain traction in the UK following the launch of Bingo Night Live on ITV1.
In poker, despite making the new loyalty scheme more generous to our VIPs, the cost of PartyPoints had been reduced to previous levels by the end of the second quarter, with the full benefit expected to be realised in the second half of the year. However, strong competition, particularly from poker sites that continue to accept US players, has led to an increase in bonuses and costs associated with some of our poker tournaments in the period.
In sports betting, Euro 2008 saw a marked increase in betting volume, but a poor run of results at the start of the tournament impacted the gross win margin.
The full year result will be impacted by a $4m one-off charge associated with the replacement of the Chief Executive that has been incurred in the first half. However, a number of new initiatives in poker, the addition of further branded slot machines during the second half and continued progress on UK bingo lead the Board to remain confident about the Group's prospects for the full year.
The Group's interim results will be announced on 29 August 2008.
Contacts:
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PartyGaming Plc |
+44 (0)20 7337 0100 |
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Peter Reynolds, Director of Investor Relations |
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John Shepherd, Director of Corporate Communications |
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