Online gaming company PartyGaming plc (PRTY.L) Wednesday said fourth-quarter revenue increased 32% from the year-ago period, helped by strong performance in casino as well as sports betting. The company expects full-year 2009 clean EBITDA to be ahead of its expectations and issued an optimistic outlook for 2010.
The owner of the PartyPoker.com online-gambling site said in a trading update that group revenue for the fourth quarter increased to $132.2 million from $100.4 million in the year-ago period. On a sequential basis, fourth-quarter group revenue increased 17%. Excluding the recently acquired Cashcade and World Poker Tour or WPT, revenue increased 16%, compared to the previous quarter, and rose 12% from the prior year.
The company returned to growth in all its four product verticals. Casino revenue for the quarter increased 44% from last year to $57.6 million, benefiting from an improving games mix and the recycling of a major jackpot win during December.
Sports betting generated $7.1 billion in the just concluded quarter, compared to $3.9 million last year. In this segment, the company witnessed an increase in gross turnover as well as gross win margin due to operational improvements and favorable results.
Bingo revenue was $17.3 million in the just concluded period, compared to $1.4 million last year. Total poker revenue slipped 11% from last year, but grew 9% from the third quarter to $49.1 million.
Total average net revenue per day in the fourth quarter of 2009 was up 32% to $1,437,300 from $1,090,800 in the previous year. This was the highest daily average since the enactment of the Unlawful Internet Gambling Enforcement Act, or UIGEA, in October 2006. The average yield per active player day increased 6% from last year, and 8% from the previous quarter, to $16.7.
New player sign-ups increased 27% to 213,700 from 168,000 in the prior year. The increase was 3% from the previous quarter. According to the company, this growth stemmed from marketing initiatives and seasonality.
Active player days increased 24% from last year and 7% from the third quarter, helped by the addition of Cashcade and higher player retention due to more effective promotions as well as improved loyalty and VIP programs. Active player days increased 7% from the third quarter.
Bonus costs and other fair value adjustments to poker revenue were 23% during the fourth quarter, slightly better than the company's expectation. Bonus costs were reduced in other product verticals on the back of successful initiatives to remove unprofitable players. The company said it now has the largest poker liquidity pool excluding US-facing sites.
Further, the company said that clean EBITDA for the year ended December 31, 2009 is likely to be slightly ahead of the Board's expectations.
Looking ahead, Jim Ryan, Chief Executive Officer of the company, ''Having recaptured the number one spot in the world in terms of poker liquidity and with our integration of Cashcade and the World Poker Tour well on track, our performance in the first four weeks of 2010 has been in-line with the Board's expectations and we remain confident about our prospects for the full year.''
"With the introduction of ring game poker, casino and bingo anticipated in Italy in the first half of 2010, the opening of the French market later this year and Denmark in 2011, we believe the outlook remains positive...With some of the world's largest gaming sites in poker, casino and bingo, and opportunities to further consolidate the online gaming sector, we are confident about our future prospects," Ryan added.
The company had confirmed last month that it is continuing to hold discussions with a number of companies in the gaming sector regarding potential consolidation opportunities. Reports had appeared stating that it was in talks for a possible deal with online gaming group Bwin Interactive Entertainment AG.
Separately, the company revealed the appointment of Per Widerström to the newly created role of Chief Operating Officer with effect from February 15. Widerström will join the Group's Executive Committee. He will report directly to Ryan and will be primarily responsible for driving growth across the PartyGaming brands.
Widerström was most recently Chief Executive Officer and Director of Mangas Gaming Malta Limited. He was previously CEO and Director of Expekt.com Ltd, Vice President and COO at Kyivstar GSM, CEO at Telenor Mobile Sweden and Director Operational Marketing & Business Development, The Coca-Cola Co.
PRTY.L is currently trading at 295.00 pence, up 10.10 pence or 3.55%, 99,052 shares.
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