Bwin Benefits From Party Gaming Rumours
Published: Thursday, August 17, 2006 Online-Casinos.com
BWIN BENEFITS FROM PARTY GAMING RUMOURS
No confirmation, but Bwin shareprice increased
The volatile online gambling sector saw some welcome relief for Bwin (Bet and Win group) this week after its 30 percent fall following the German state of Saxony ban from taking sports bets in Germany. Unconfirmed rumours that Party Gaming was interested in the stock sent it 5 percent up.
The troubled Austrian betting group has two weeks to challenge the Saxony ruling in a court in Dresden, and had earlier claimed that German politicians wanted to retain the state betting monopoly for fiscal reasons.
More solid information followed when Bwin released second quarter and first half 2006 financials:
It remains the fastest-growing company in the online gaming industry with gross gaming revenues of Euro 191.6 million - up 216 per cent.
Around 1.5 million active "real money" customers, incl. 770 000 active for first time (up 289 percent and 237 percent respectively).
Company still in hyper growth phase with EBITDA of Euro 3.8 million.
Revised expectations for financial year 2006: gross gaming revenues of approximately Euro 435 million; EBITDA of at least Euro 40 million.
Bwin increased its gross gaming revenues in the first half of 2006 to Euro 191.6 million, an increase of 216 percent compared to the same period the previous year (first half of 2005: Euro 60.6 million). Of this amount, gross gaming revenues from sportsbetting operations amounted to Euro 80.8 million (first half of 2005: Euro 41.9 million).
The gross gaming revenues generated by the casino, poker and games sectors amounted respectively to Euro 41.2 million (first half of 2005: Euro 13.8 million), Euro 63.0 million (first half of 2005: Euro 3.1 million), and Euro 6.5 million (first half of 2005:Euro 1.8 million).
Almost 1.5 million customers were active in the first half year (first half of 2005: 376 000 customers, up 289 percent). This included around 770 000 customers who became active for the first time (first half of 2005: 227,000 customers up 237 percent).
The group spent Euro 100.9 on marketing in an unchanged budget from last year.
However there were disappointing numbers when it came to consolidated results. Several factors impacted the weaker than expected performance for the first half year of 2006. The development of revenues in the sports betting sector fell below average during the Soccer World Cup due to the many wins by favourites. Furthermore, the growth of the poker business in the USA was below expectations, and Ongame's contribution to the result, though positive, was also below plan.
Other factors included the increased costs for legal advice and lobbying activities aimed at liberalising the European market.
The consolidated loss after taxes and third-party interest was Euro 27.1 million for the first half of 2006 (first half of 2005: Euro 0.1 million). A charge of Euro 18.2 million had to be made due to the non-cash depreciation of the customer base and software acquired as a result of the Ongame transaction.
