24 Jun 2010 15:04
| Date: | 24 June 2010 |
| On behalf of: | NetPlay TV plc ("NetPlay TV" or "the Company") |
| For immediate release |
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NetPlayTV plc
Trading Update
As promised on 3 June 2010, NetPlayTV announces an update on early performance of Challenge Jackpot and the new Bingo Stars products broadcast online and on Virgin 1, STV, and ITV's teleshopping window.
On 27 May we launched the Bingo Stars product and subsequently launched a complementary mobile entry mechanism to allow instant game play. Whilst it is still very early days the revenue flowing from these instant game players has been much lower than anticipated.
It is becoming clear that we need to be very flexible in our product outputs and, on 21 June, we altered our format and scheduling to trial an alternative format in our earlier segment. This product is a more akin to our proven interactive gaming formats. We have gained a vast amount of knowledge from our current successful and profitable media partnerships and we are using this knowledge to the full, both in terms of potential cost savings and customer playing habits. Early signs are more encouraging with customers depositing funds during the show as well as to the website the following day.
The move from an instant play model to a more traditional game play, as well as increased first half costs, will have a material impact on our short term profit performance. As a result the Directors believe this will have a significant impact on the full year market expectations. The initial costs associated with producing and trialling new gaming formats are high, although as we amend the model to be more inline with our proven formats we are able to reduce costs significantly with immediate effect.
The focus on developing new formats, moving technical platforms, migration offshore and improving our core offerings has been a major upheaval for the business; as a result costs have increased substantially in the short term. In altering the current format and scheduling as well driving more synergies between our brands we are able to strip costs out from the business with immediate effect, thus protecting cash and the Company's balance sheet.
The financial profile of instant games as opposed to traditional gaming products is substantially different. Instant games generate all of their revenue and profit in the first month, as opposed to casino products which generate their revenue over the life of the player, known as the "Life Time Value". In the case of casino products, it is normal for the revenue to take up to 12 months to feed through to the business.
We have a proven business model and remain committed to delivering a fusion of instant play and our traditional gaming formats. Broadcasting acquisition gambling products on "teleshopping" airtime allows us to acquire players in an environment where we have no competition and, as such, the aim is to have a lower than industry average Cost Per Acquisition (CPA). Our aim in mixing instant games with traditional gaming formats is to reduce this CPA substantially.
Whilst it is too early to give any firm guidance, the Company will keep the market fully informed of its performance over the coming months.
- Ends -
Enquiries:
| NetPlayTV plc | www.NetPlayTV.plc.uk |
| Martin Higginson, Chief Executive Officer | Via Redleaf |
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| Redleaf Communications | Tel: 020 7566 6700 |
| Emma Kane / Mike Ward | NetPlayTV@redleafpr.com |
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| Panmure Gordon | |
| Dominic Morley / Stuart Gledhill | Tel: 020 7459 3600 |
Notes to Editors:
About NetPlayTV plc
NetPlayTV TV plc is listed on the AIM market of the London Stock Exchange (NPT). NetPlayTV TV operates a number of interactive gaming services under UK, Malta and Alderney gaming licenses, including SuperCasino.com, ChallengeJackpot.com and Bingos.com. These services can also be viewed 24 hours a day live on Sky Channel 866 and 867, every evening on the terrestrial channels, Five, and STV, plus Freeview on Virgin 1, 1am - 4am and Bravo 2 and 24/7 on Virgin Media channel 141.
The Company is focused on the delivery of a converged interactive gaming experience allowing its customers to interact with its games on a variety of platforms, TV, Internet and mobile from a common integrated wallet.