Tuesday, September 29, 2009

PartyGaming News Media Update - September 2009

PartyGaming Friday reported a less-than-expected 6.5% fall in first-half earnings, hurt by the stronger dollar against the pound and fierce poker competition online, and said second-half trading so far has been in line with management's expectations.

Chief Executive Jim Ryan advised trading in the three weeks ended 18th August, which represents the peak holiday season in most of the group's core markets, has been "strong," inline with management's business expectations.

Mr Ryan said the company's three-year strategy is on track and that it remains "confident about the group's prospects and look forward to the rest of the year with confidence."

Earnings before interest, tax, depreciation and amortization from continuing operations - the key figure watched by U.K. gaming analysts - fell 6.5% to $60.7 million in the first half to June 30, ahead of market expectations of $58.7 million. This compares with $64.9 million over the same period last year.

First-half net revenue dropped 21% to $201.3 million, inline with expectations, from $254.8 million a year earlier.

PartyGaming, the world's biggest listed-online gaming group by market capitalization, has been on the acquisition trail since its long-awaited settlement with U.S. authorities over its defunct gaming operations there in April.

Its first purchase was London-based bingo and casino operator Cashcade Ltd. for GBP95.9 million last month, and earlier this week it agreed to buy the bulk of WPT Enterprises Inc.'s operating assets for $12.3 million as well as 5% of the revenue generated by the assets.

Gibraltar-based PartyGaming didn't declare an interim dividend, in line with expectations, preferring to stock-pile money for "attractive consolidation opportunities." The U.K.-listed company hasn't paid a dividend since the U.S. government banned the online gaming industry in October 2006.

PartyGaming shares closed at 266 pence, valuing the company at GBP1.08 billion on the London Stock Exchange. The stock has risen 37% since January, fueled by its legal settlement with U.S. authorities and expansion plans.

PartyGaming's flagship brands are PartyCasino.com, PartyPoker.com, and is looking to ramp up its recent purchased brands, World Poker Tour and Foxy Bingo.

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