Material Losses To a Major Player
British casino operator and bookmaker Stanley Leisure Plc (SLY.L) issued a trading statement last week to alert the market that certain factors have forced the company to reduce its expectations for the full year. According to the statement, unfavorable sporting results have caused both its domestic and international betting businesses to suffer losses that cannot be offset even by the increase in machine profits. The company also notes that its gaming division has an accounting policy of providing for unpaid gambling debts, though the timing of the collection is uncertain and some remain outstanding at the end of the year. But the most significant comment about the company's gaming division is that it "has suffered material losses to a major player." With these setbacks in mind, the company has readjusted its outlook and now expects to report year-end profits broadly in line with last year. The company's financial results for the year ended Oct. 31, 2004 will be announced on Jan. 26, 2005 and will provide updates for the outlook of the financial year. Stanley Leisure's share price fell by 10 percent following the profit warning, which occurred just six weeks after chairman Leonard Steinberg sold £36 million worth of shares.
A Two Way Float
Two Way TV Australia Ltd. (TTV.ASX) debuted on the Australian Stock Exchange on Dec. 23 at A$1 per share, raising $40 million. The company, which has been operating in Australia for over 10 years, has an exclusive license to access Two Way TV UK's library of digital, interactive TV and mobile media applications. The company has already used the licensed technology to collaborate with Sky Racing and Tab Ltd. in developing an interactive racing application that would enable punters to place bets with state-licensed totalisators from their televisions. The company expects to have the betting application available to NSW TAB 1 customers within 18 months. In 2003, Two Way TV Australia generated revenue of A$239,229 million and a net loss of $1.78 million. The company has paid A$10.58 million to exercise options to establish businesses in 12 Asian markets--Hong Kong, Japan, China, India, Singapore, Taiwan, Malaysia, South Korea, North Korea, Thailand, Pakistan and Indonesia. An additional A$434,000 was spent to enter the markets in Macau, the Philippines, Vietnam, Cambodia, Bangladesh, Burma, Brunei, Nepal, Bhutan, The Maldives, Mongolia, East Timor, Sri Lanka and Papua New Guinea. According to Two Way TV's managing director Jim McKay, "Even in those territories where digital television is at an early stage, the populations are so large that we see significant opportunities for using other technologies such as mobile phones to engage interactive television."
Betting Terminal Gains Offset Bookmaking Losses for Will Hill
British bookmaker William Hill Plc (WMH.L) recently gave a trading update to inform the market that it has been adversely affected by sports results in the second half of 2004. Unlike Stanley Leisure, however, William Hill stated that its income from fixed-odds betting terminals should be sufficient to offset the betting divisions setbacks. The group still expects its annual profit before interest and tax for the year 2004 to increase 15 percent to £232 million.