Casino boost
Sportingbet, the online sports betting and gaming group, shored up confidence in the sector yesterday by unveiling that profits had quadrupled.
Shares in internet-based poker businesses crashed on Monday when Empire OnLine’s chief executive Noam Lanir suggested that there was little growth in the sector during the third quarter. His comments helped send shares in Partygaming, the FTSE 100 company, to their lowest level.
However, Sportingbet pulled the sector up by announcing that pre-tax profits for the full year to the end of July had rocketed to £40.8m from £8.3m. Sports and gaming punters bet 51 per cent more money, or £400m in total.
Sportingbet operates around 30 websites including Paradise Poker, which the group bought almost a year ago for £169m. Its figures helped Partygaming to become the biggest FTSE 100 riser yesterday morning, up 10 per cent to 78.75p, while shares in Sportingbet on AIM rose 7.4 per cent to 308p.
Nigel Payne, chief executive, said: “We now have over 2.7m registered customers who generated an 89 per cent increase in the daily poker rake.”
Analysts said the results should reassure the market. Some raised their estimates of pre-tax profits from the company to almost £90m in 2006.
Betting on sport has increased, while the majority of income from poker is coming from Paradise Poker
Experts say the downgrading of shares on Monday was an overreaction to comments made by Empire OnLine’s boss. They were made as the company announced third-quarter results in which it said that the number of new players had risen to 53,148 for the third quarter, an increase of 62 per cent on the same period last year and 24 per cent over the second quarter.
Net revenues were up 71 per cent from last year to 31.4m and 24 per cent on Q2. Also this week, Gameaccount announced its intention to float.