Paddy Power Posts Gains in Turnover and Gross Win Percentage
Paddy Power's (PAP) preliminary results for 2002 indicate record turnover, operating profit and earnings per share for the year ending Dec. 31, 2002. The company's online gambling business is posting significant gains in turnover and gross win percentage, said Stewart Kenny, the chairman of the board of directors.
Turnover from all betting operations, including the group's 132 betting shops in Ireland and the United Kingdom, telephone betting and online betting was EUR 673.8 million, a 46 percent increase from last year's figure of EUR 461.1 million. Operating profit was up 101 percent, to EUR 17.1 million from EUR 8.5 million in 2001. John O'Reilly, chief executive, said the company experienced a record year.
"Driven by our focus on customer service and innovative product, we have continued to see strong growth in all channels of our core Irish business where there remain significant further opportunities for expansion," he said.
In terms of online betting, Paddy Power has more online customers who are betting more frequently than in 2001. The company had 29,660 active users at the end of 2002, compared with 14,758 active users at the end of 2001. The number of registered users has grown from 42,431 in 2001 to 121,327 in 2002. Customers are considered "active" if they have placed at least one bet in the last three months. The number of times an average active customer bets per month has grown to 13 times from 9 times in 2001.
While the number of online customers has grown substantially, the average bet has decreased six percent during the year to EUR 26.63 from EUR 28.20. Despite that, the company feels that its online brand is spearheading brand awareness in the United Kingdom, where the online betting business is growing swiftly.
Total gross margin – the amount bet minus the customers' winnings – increased by 11.43 percent for the whole group. The online betting division increased its gross margin to 8.18 percent from 6.42 percent in 2001.
dot com Entertainment Group Reports on "Transitional" Year
Internet casino software provider dot com Entertainment Group Inc. (OTCBB: DCEG) is reporting revenue of $3.5 million for the year ended Dec. 21, 2002. That figure compares to revenue of $3.8 million last year.
The Toronto-based company, along with its affiliate partner, Parlay Entertainment Ltd., said performance during the last year reflects a number of organizational changes. David Outhwaite, CEO, calls 2002 a "transitional" year.
"While the short-term impact of these initiatives is reflected in our 2002 results, we're confident that DCEG is now positioned for strong performance in a growing market in 2003 and beyond," he said.
Those organizational changes included Parley increasing its licensee base by 88 percent, introducing a standardized licensing fee structure, implementing a tax-efficient corporate structure and strengthening the board of directors and senior management team.
Parlay increased its list of customers to 17 licensees, up from nine. The company also increased the number of gaming systems licensed from eight to 27.
Expenses, including non-recurring charges, were $3.3 million in 2002, compared with $2.6 million in 2001. The non-recurring charges included approximately $550,000 having to do with corporate restructuring and legal settlements.
Youbet.com Management Updates Shareholders
Youbet.com Inc. (UBET) issued an update to its shareholders this week outlining what the company has accomplished in the last year and announcing staffing changes.
David Marshall used the letter to announce that his role at the company will be changing. Marshall co-founded Youbet.com in 1987 and stayed with it until 1999. He returned in March of 2002 to help engineer its return to profitability. Marshall said he will continue as a member of the executive committee of the board of directors and that Chuck Champion, currently the COO, will move into the position of chief executive. Marshall said Champion, who was formerly in the publishing industry, has "proven to be a highly competent manager and leader."
"He has learned the industry, knows and is respected by the key players, and is ready to take responsibility for all the deliverables at Youbet.com," Marshall said of Champion.
Marshall went on to write that since March of last year, Youbet.com has increased wagering volume, cut operating costs and reduced cash burn. The online horse race wagering company has also added online withdrawals to ExpressCash, its two-way electronic check processing service, launched a new homepage, increased the number of tracks it covers and processed its 25 millionth wager.
"The U.S. market for horse race betting is over $17.2 billion, which gives us room to grow domestically," Marshall said. "The overseas market – at about $100 billion – represents a significant opportunity for Youbet.com as we begin to develop and deploy our international strategy."