Busy Week for PartyGaming, Garber and one Anonymous Shareholder
The Times reported on Feb. 27 that one unidentified shareholder in London-listed PartyGaming (PRTY.L) on Monday offloaded 123 million shares worth an estimated £50 million ($98.2 million). The anonymous seller is thought to be Bermuda-based fund Orbis, the paper said, which in January was rumored to have purchased stock from Party founder Vikrant Bhargava.
On Thursday, the company issued its full year results, which revealed a 56 percent drop in annual profit on costs related to its compulsory U.S. exit in October 2006. Net income fell to $128.4 million or 3.3 cents a share, from $293.2 million, or 7.5 cents, in 2005. Though its withdrawal from the U.S. incurred a one-time expense of $243.2 million, sales climbed 13 percent to $1.1 billion as the company aggressively sought non-U.S. customers.
The company lost roughly three-quarters of its revenue in October, after the enactment of legislation targeting I-gaming in the United States. Its non-U.S. sales, however, more than doubled to $325 million, spurred in part by its August acquisition of Gamebookers.
"While the decision to stop accepting customers from the U.S. was a bitter blow for our business, our continuing operations have grown strongly," said Party CEO Mitch Garber.
While U.S.-based bettors accounted for 71 percent of Party's sales in 2006, the company now derives roughly two-thirds of its revenue from Europe, the Middle East and Africa.
On a conference call to journalists on Thursday, Garber remarked that France "is not an attractive market," after anti-gaming legislation was adopted by the French Parliament on Feb. 22.
On Friday, the company announced Garber had exercised options over 3.7 million shares and sold over 3.3 million at 33p a share, raising just under £1.1 million ($2.1 million). Garber also announced the adoption of a "planned share sale program," approved by the PartyGaming board, which sees him sell an unspecified number of shares at the conclusion of every quarter. The company said that finance director Martin Weigold also adopted a similar program.
PBL Denies Tabcrop Takeover Rumors
The Australian reported Monday that PBL (ASX: PBL) head of gaming Rowen Craigie said that the company was not considering a move for Tabcorp (ASX: TAH), whose recent struggles have seen CEO Matthew Slatter put on six-months notice by the company's institutional shareholders. Craigie told the paper that PBL's next move would be overseas, and that the company is not "focusing on Tabcorp or the rest of the sector in Australia."
NetPlay TV Acquires Abstract Games
Interactive media group NetPlay TV (SEA: NPT) on Monday announced the acquisition of Sunderland-based Absract Games for £4 million ($7.8 million).
Tipp24 Exceeds FY '06 Market Expectations
Germany-based lotteries provider Tipp24 AG (FRA: TIM) in mid February reported a marked increase in lottery ticket sales grew to 29.1 percent to 264.2 million euros ($346.5 million), while revenue (34.6 million euros) also rose 32.6 percent.
The company said that earnings before interest, taxes, deductions and amortization (EBITDA) climbed 20 percent to 7.2 million euros ($9.4 million), while group earnings more than doubled to 7.5 million euros.
"We consider the continued dynamic growth of our company in a difficult regulatory environment to be a complete success," said Tipp24 CEO Dr. Hans Cornehl. "Particularly in view of the fact that there were special negative effects in 2006: higher marketing expenses in connection with the record jackpot, costs of lobbying activities and the elimination of ExtraLotto."
Svenska Spel Posts Record Profits for FY '06
Swedish government-owned and -licensed operator Svenska Spel on Tuesday reported record full year profits of $685 million, driven by its online poker arm, which launched in November 2005.
"It has really fulfilled its purpose of bringing home a big part of Sweden's unregulated poker playing to a responsible environment within the country's borders," observed Svenska Spel CEO Jesper Karrbrink.
Sportingbet's Q2 Profit Soars
Sportingbet (SBT.L) reported a 54 percent increase in Q2 profit on Wednesday, adding that it had (so far) avoided dealings with French authorities.
The company said that results from football, which accounts for 70 percent of its European business, had gone in its favor this season, saying moreover that its third quarter had started well.
Addressing rumors of the French I-gaming inquisition, Sportingbet CEO Andy McIver told reporters that French Authorities had not requested a meeting and said less than 2 percent of the company's business originates in the country.
Including its former U.S. operations, the company reported a group operating loss of £243.9 million ($468.3 million) in the six months ending Jan. 31, compared to a profit of £43.1 million ($82.7 million) a year earlier.
Sportingbet also announced it had agreed to buy Turkey-based marketing partner Maslin Properties for £3.5 million ($6.7 million), plus a payment in shares dependent on performance. Additionally, the company bought a further 40 percent of its Italian joint venture, taking its total holding to 90 percent, for 4.25 million euros ($5.56 million).
"One of our concerns with Sportinbet moving forward, now that the U.S. business had to be sold, was its low levels of equity in its key European markets," Altium Securities analyst Wayne Brown told Reuters. "We are therefore pleased to see … the acquisition of assets of its Turkish marketing partner," he added.
Solid FY '06 for Playtech
Released Wednesday, Playtech's (PTEC.L) full year results evinced a significant jump in total annual revenue (89 percent)--$90.1 million--against last year's figure. Casino (81 percent) and poker (309 percent) revenues also showed marked growth, totaling $77.2 million and $10.9 million respectively.
Looking ahead, the company said that the migration of the Tribeca poker network onto the Playtech platform is expected to create the largest shared-liquidity pool in I-poker and provide further growth opportunities for the company and its licensees.
Playtech also said it expects to benefit from its five-year agreement with China-based gaming group Sino Strategic International (SSI) (announced Dec. 20, 2006), which sees it deliver its P2P games to an estimated 600 SSI outlets throughout the country in 2007.
"[Playtech's] broad international portfolio of clients, especially in Asia and Europe, meant that the impact of the prompt withdrawal by its licensees from the U.S. market was greatly reduced, said company chairman Roger Withers.
BSkyB Mails Interim Report
British Sky Broadcasting (BSkyB.L) on Thursday announced that its interim report had been mailed to all shareholders.
Genting Releases Full Year Results, Profits Surge
Investment holding company Genting (SIN: G13) on Thursday said its net profit for the year ending Dec. 31, 2006 rose 25 percent to $426.9 million, compared to $341.5 million the previous year.
Revenue also jumped 27 percent to $1.9 billion from $1.5 billion, while pre-tax profit rose 13 percent to $768.4 million against last year's figure ($683.1 million).
The company's revenue received a significant contribution ($120.3 million) from U.K.-based Stanley Leisure, which in October 2006 became an indirect Genting subsidiary.
Arena Leisure Publicizes '06 Prelims
Preliminary full year results from U.K.-based operator Arena Leisure (ARE.L) revealed an 11.1 percent increase in turnover to £45.3 million ($87.2 million), from £40.7 million ($78.4 million) the previous year. Pre-tax profits also jumped 29.6 percent to £5.8 million ($11.1 million), while earnings per share rose 29.8 percent to 1.61p (from 1.24 in 2005).
The company reported a proposed final dividend of 0.26p per share, yielding a total dividend of 0.51p per share--up 13.3 percent from 0.45 per share in 2005.
Racecourse profits also grew by 8.5 percent to £8.7 million ($16.7 million), compared to last year's £8.0 million ($15.4 million).
Arena's share in At the Races, its joint venture with BSkyB, saw adjusted operating loss reduced by 74 percent to £300,000 ($578,000).
"I am delighted to report … solid performances from both our racecourse division and our joint venture media rights company, At The Races … advances were made in a number strategically important areas that will yield significant value over the forthcoming years," said Arena chairman Raymond Mould.
Bingo.com Revenues Hit Slippery Slope During Q4 '06
Bingo-based Web portal Bingo.com (OTC: BNGOF) last week reported total revenue fell 88 percent to $103,630 and said it had sustained a net loss of $336,727 during the fourth quarter ending Dec 31, 2006.
Meanwhile, I-gaming revenue plummeted $727,114 to $94,780, though the company did received $180,000 toward the total purchase price ($1.2 million) of its U.S.-facing operation.
"With the United States Unlawful Internet Gambling Enforcement Act, the company was left with no choice but to halt its gaming operations and sell its entire U.S. gaming business to an unrelated third party," said CEO Tarnie Williams. "This regulatory change significantly impacted Bingo.com's revenue and therefore its profitability in both this and the first quarter of 2007."
Scientific Games Reports Strong Q4, Full Year Performances
Q4 results from Scientific Gaming showed revenues rose 14 percent to $232.1 million, from $202.9 million in Q4 2005, while EBITDA climbed 24 percent to $48.3 million, against last year's figure ($38.9 million).
The company also reported net income $7.9 million, or $0.08 per diluted share--a loss compared to figures from the pervious year ($10.3 million, $0.11 respectively)--and incurred $13.5 million in employee termination costs, with an additional $3.9 million in stock compensation costs.
On the year, revenues increased 15 percent to $897.2 million, compared to 781.7 million for 2005. Net income totaled $66.8 million, or $0.70 per diluted share, during which time the company incurred $25.1 million in employee termination, asset impairment and "other costs," while doling out $17.9 million in stock compensation expenses.
EBITDA increased 22 percent to $239.5 million for 2006, compared to $195.7 million in 2005. Excluding employee termination costs, stock compensation expenses assest impairment and other charges, adjusted EBITDA increased 23 percent to $272.7 million for 2006 from $222.4 million in 2005.
"Italy continues to exceed expectations, achieving record sales every month, making Italy the strongest instant ticket market in Europe just two-and-a-half years after launch," said company CEO Lorne Weil. "One of our goals is to bring the type of success we have generated in Italy to other international jurisdictions."
Weil said Scientific Games underwent a "company-side restructuring" during the fourth quarter, saying moreover that the company was "better positioned" to generate new customers. Weil added that the employee termination charges, which approached $13.5 million, to result in an annual cost savings in excess of $20 million.
Rank Group says Out with the Old, In with the New
Having completed the sale of its Hard Rock Café chain on March 6, 2007, the U.K.-based Rank Group (RNK.L) reported its first annual profit in three years, having shed its Europe-focused media activities to redouble its U.K.-facing gaming efforts.
Net income totaled £117.2 million ($226 million), or 19.9p a share, compare with a loss of £209.7 million ($404.4 million), or 33.5 a share, in 2005.
"Through the actions we have taken in 2006, we have repositioned the group to focus purely on mainstream gaming," said Rank CEO Ian Burke.