Market Briefs - May 17-21, 2004

Ladbrokes Drives Hilton's Success

Pre-tax profits for Hilton Group Plc (HG.L) for the first quarter of 2004 have doubled since the first quarter of 2003, thanks largely to Ladbrokes, which now contributes 60 percent of the entire group's profits. Overall Ladbrokes experienced a 27 percent increase in gross win compared to the same period last year. The company says its gross win from I-gaming operations has increased by 34 percent due to the sports books' improved margins and continuing growth in online poker. Telephone betting contributed a 91 percent increase in gross win, also due to higher margins, although turnover fell slightly as a result of the absence of live televised racing. Ladbrokes' 1,900 betting shops experienced a gross win increase of 25 percent and a 14 percent growth of over-the-counter business.

Coral To Float?

The Observer reported last week that Coral Eorobet intended to float on the London Stock Exchange later this year to capitalize on the growing enthusiasm for gambling stocks, but Coral's chief executive Vaughn Ashdown has since dismissed the report as "another trawl through the press cuttings." He added, "It's pure speculation, and the source of the story was neither this company nor our venture capitalist owners Charterhouse. It's probably been put about by City bankers looking for business." He did concede, however, that although no decision has been made, a profitable float will always be an option to consider.

New Exchange to Float

Gaming Bourses--a London-based portal for financials, commodities, media, political and sports betting exchanges--announced last week that it intends to raise £5 million by floating on the Alternative Investments Market of the London Stock Exchange sometime around June 11. The company, which plans to add 8 million shares, is likely to have an issue price of 68p, which should set its market cap around £30 million. Hamish Raw, a former options trader who set up a company called FfastFill that provides software for electronic exchanges, will undertake the position of managing director of Gaming Bourses, which currently has 149 private investors and plans to go live next month.

Ad Revenue on Net Sets Quarterly Record

Internet advertising revenue in the first quarter of 2004 set a single quarter record of $2.3 billion. The figure is four percent higher the previous quarter's $2.18 million and 39 percent higher than the amount over the same period last year. Annual Internet advertising revenue peaked in 2000 at $8.09 billion. If the current pace continues, 2004 should break that record.

CryptoLogic's Investor Increases Holdings

CryptoLogic Inc (CRYP) received notification on May 14 from U.S. investment firm Royce & Associates that it has increased its holdings in CryptoLogic to 1,539,558 shares or about 12 percent of current shares outstanding. CryptoLogic's CEO and President Lewis Rose said the act illustrated the firm's confidence in CyrptoLogic's growth strategy.

Stanley Issues Trading Update i wasn't able to post iswi's report becuase i can't save it. it is located at http://phx.corporate-ir.net/phoenix.zhtml?c=70841&p=irol-sec, it is the highest pdf file. you could probably post it from your home computer.

Stanley Leisure Organization Plc (SLY), which will publish its preliminary results for the year ended May 2, 2004 on July 21, last week issued a trading update ahead of its close period, stating that the performance of is betting division during the second half of the financial year followed positive trends of the first half and trading has exceeded expectations ijn all three of its businesses. Trading in the gaming division, however, was mixed. Its casinos at Crockfords and Colony Club experienced low win margins on the year. The company has in excess of £3 million in collectable debts from some of its major players, and though it expects to collect that money, it may not be able to record these debts on its preliminary results. The imbalance between Stanley's two divisions probably means that the company will post results below last year's amount.

Reports Released

The financial results reported by World Gaming Plc (OTC.WGMGY), a U.K.-based Internet gaming software and e-business services group of companies, for the first quarter ended March 31, 2004 boast net profit of $1,989,000 or $0.04 earnings per share compared to a net profit of $441,000 or $0.01 earnings per share for the corresponding period last year. World Gaming also recorded total revenues of $5,364,000--compared to last year's $4,537,000--driven mostly by increased licensee wagering volumes of 26 percent and higher net win by the licensees. Operating expenses decreased 19 percent from last year's first quarter mark of $3,562,000 to $2,890,000.