Net Entertainment Growth Continues
Published: Monday, February 18, 2008 Online-Casinos.com
NETENT GROWTH CONTINUES
Swedish turnkey provider reports solid Q4 and full year 2007 results
Swedish online gambling software developer and turnkey provider Net Entertainment finished the full year 2007 with a quarter 4 flourish, maintaining its successful performance from previous years. Announcing its results this week, CEO Johan Ohman highlighted key performance indicators achieved by his company:
January - December 2007
Net sales increased by 32.2 percent to SEK 132.0 million (2006 - SEK 99.8 million)
After taxes results increased by 61 percent to SEK 45.9 million (2006 - SEK 28.5 million)
Net profit margin up at 34.8 percent (28.5 percent in 2006)
18 new CasinoModule license agreements signed
Quarter 4 (October - December 2007)
Net sales increased by 17.1 percent to SEK 36.3 million (2006 - SEK 31.0 million)
Result after taxes increased by 35 percent to SEK 13.8 million (2006 - SEK 10.2 million)
Net profit margin 38.0 percent (2006 - 33.0 percent)
5 new CasinoModule license agreements signed
Operating profit rose to SEK 15.2 (12.6) million, which resulted in an operating margin of 41.9 percent.
Net Entertainment repaid the remaining SEK 4.7 million of a loan from its previous parent company Betsson, and is now completely debt-free.
Ohman informed shareholders that a decision had been taken to apply for Small Cap listing at OMX Exchange in Stockholm.
"Net Entertainment's Q4 development was good, and net sales increased 12.5 percent compared to Q3," said Ohman.
"The 32.4 percent total net sales increase for 2007 should be compared with an average 23 percent increase for European online gaming, according to Global Betting and Gaming Consultants estimates.
"Successful product development and continued strong market growth are major reasons for our success. Incoming orders continue to pour in, and we signed five new CasinoModule license agreements during Q4, for a total of 18 in 2007."
During 2007 Net Entertainment gradually reduced its dependence on consultants through a successful recruiting program. 14 new staff members were hired, mostly in the technical department, which allowed the firm to increase the tempo of development and produce more advanced games.
"We issued four product releases in 2007 with 23 new unique games (43 including variations), which gives us a major competitive advantage," Ohman claimed. "Net Entertainment is established as a major player in online gaming - a position that we will continue to strengthen through our accelerated development rate and broad product portfolio."
The Net Entertainment CEO revealed that plans going forward include the start of development operations in the Ukraine during Q1 2008.
During Q4 2007, Net Entertainment divested its subsidiary Feliz Europa in Costa Rica and gathered all commercial-oriented operations into Net Entertainment Malta Ltd. Hosting will continue to be offered in Costa Rica through the Malta subsidiary.
Ohman ended on a positive note, saying: "The online gaming market is predicted to continue to grow positively, which benefits us through the organic growth of our current licensees. I believe that we are also better equipped than ever to win new strategic deals and thereby further reduce our dependency on existing customers."
Net Entertainment was founded in 1996 and has a client operator base of over 50 international gaming companies. Revenues consist of royalties based on income generated with the company's products as well as other sales revenues. Net Entertainment is a pure development company and therefore does not operate any gaming sites of its own.
The Group has its head office in Stockholm where all technical development is undertaken, and an office in Malta where all commercial operations including sales, marketing and product management is conducted.
The parent company has been listed on Nordic Growth Market (NGM) Equity since April 5, 2007. The Board of Directors has decided to apply for listing at OMX Exchange Stockholm, Small Cap during 2008.
