Neteller Doubles Profits Again
Published: Friday, September 09, 2005 Online-Casinos.com
NETELLER DOUBLES PROFITS FOR THIRD CONSECUTIVE HALF-YEAR
Online cash processor says Asian activity will drive its earnings for foreeable
future.
The Isle of Man-based online financial processor Neteller has announced doubled
profits for the third consecutive half year.
The company predicts that Asia's growing appetite for online gaming will drive
earnings at for several years, and that the craze for online gambling, which made
up 80 percent of the company's transfers in the first half, was still going strong
in Western markets, and Asia had huge potential to continue that growth, Chief
Executive Gord Herman reported.
"Asia hasn't even started in this industry yet. It's potentially a massive
industry that right now probably has, at least, a 2 to 3 year growth cycle,"
Herman told Reuters news service in an interview.
Neteller's pretax profit jumped 126 percent to $40.6 million (GBP 22.1 million)
in the six months to end-June, while it increased revenue by 122 percent to $73.5
million. Herman said he saw this level of growth continuing into the second half
and beyond.
"For the last half of the year that's certainly sustainable. For 2006, ...
I would guess with what's happening, and our ability to penetrate the Asian market,
that that's highly probable," he said.
Although the percentage of Chinese people hooked up to broadband internet was
tiny, the actual number -- around 80 million -- was the same as in the United
States, Herman said. This figure was expected to grow to 280 million by the end
of next year.
At present gambling is restricted in China to certain economic zones such as Macao,
but Herman said the issue was to what extent the Chinese government could control
a new generation who are online and like gaming.
On the heels of the report, Neteller shares climbed 2 percent to 883-1/2 p, valuing
the business at GBP 1.07 billion. It sold shares at 200 pence when it floated
last April.
Herman estimates that the company has a 15 percent slice of its market, but said
this percentage had the potential to grow as banks in the United States and Britain
became more reluctant to process online gaming payments.
Neteller's membership doubled to 1.75 million year on year, with 3,000 new members
joining daily.
