Internet Gambling Wallet 'Neteller' Rolls On

Published: Tuesday, March 28, 2006 Online-Casinos.com

INTERNET GAMBLING WALLET 'NETELLER' BANDWAGON ROLLS ON

Annual profit more than doubles, and users now at 2.5 million

Neteller fans who watched its stellar performance last year but didn't buy shares in it were probably kicking themselves this week as the e-cash processor delivered outstanding annual numbers.

The publicly listed company said its annual profit more than doubled, fuelled by robust growth in the online gambling industry, and predicted further strong expansion in 2006.

Neteller reported its 2005 pretax profit came in at $97.8 million, up 114 percent from $ 45.8 million the previous year, while revenues jumped 108 percent to $172.1 million.

The Isle of Man-based company, now arguably the biggest supplier of money transfer services to internet gamblers, said its customer base had reached the 2.5 million threshold in the first quarter of 2006, and predicted further strong growth over the year as a whole.

CEO Ron Martin reported: "2006 promises to be another impressive year in the growth and expansion of Neteller."

However, the company did caution on one dark cloud on its horizon. With 95 percent of its revenues originating in the US, the proposed US legislation aimed at cracking down on the burgeoning internet gambling industry could "materially adversely" affect it, the report noted.

Earlier this month, draft legislation from Rep. James Leach designed to prevent Internet gambling companies from accepting payment via credit cards or electronic fund transfers came closer to becoming law after being approved by a Congressional committee.

Analysts have said the company also faces a fresh competitive threat from larger rival Paypal, which recently began offering payment transfers to online gamblers in Europe and the UK.

Neteller shares closed at 734 pence following the publication of the results, valuing the company at about GBP 883 million.