Thursday, PartyGaming Plc (PRTY.L), in its interim management statement, posted a lower third-quarter revenue, citing the impact of a macroeconomic environment, relatively strong dollar and fiercely competitive poker market, with a 51% surge in player acquisition. However, revenues grew 11% sequentially, largely due to a maiden contribution from Cashcade, acquired in July.
For the three months to September 30, total Group revenue decreased to $112.7 million from $117.7 million in the last year, with the recent quarter including network services revenue of $0.4 million. Excluding Cashcade, revenue was down 4% from the second quarter, in line with the normal seasonal pattern seen in previous years, the Group, together with its subsidiaries, said.
Commenting on the third-quarter Key Performance Indicators, Chief Executive Jim Ryan said, "Our performance in the seasonally weak third quarter was in line with our expectations, with revenue up 11% versus the previous quarter."
Ryan added that poker remained challenging from a competitive standpoint and, finally, the addition of Cashcade transformed its presence in the $1.5 billion online bingo market, and was the driver behind the substantial increase in its bingo revenue.
The 51% surge in new player sign-ups, totaling 208,000, helped to offset factors that impacted the latest quarter, the Group said. The number of consolidated active player days grew 24% to 7.3 million from 5.9 million a year ago, while unique active players for the period increased 35% to 726 thousand from 538 thousand last year, helped by the acquisition of Cashcade, the Group said.
Consolidated yield per active player day fell 23% to $15.4 from $20.0, due in part to higher bonus costs driven by the acquisition of Cashcade and the costs associated with the new retention initiatives. The Group also said player yields declined year-on-year due to foreign exchange movements as well as bonus costs increasing to 25% of gross revenue in August.
Poker revenue was down 8% to $45.1 million from $65.0 million last year with higher player numbers offset by lower yields. Average poker daily net revenue was down 31% to $489.7 thousand from $706.8 thousand, with active poker player days decreasing 2% to 4.6 million from 4.7 million, offset by a 6% rise in unique active poker players to 435.5k from 409.7k year-over-year.
Casino revenue was up 2% to $49.2 million from $45.6 million last year, due to higher player yields. Average casino daily net revenue growth was 8% to $534.9 thousand from $495.5 thousand, on active casino player days falling 2% to 972 thousand from 990 thousand and upset further by the 16% fall in unique active players to 172.2 thousand from 204.0 thousand for the same period in 2008.
Sports revenue fell down to $4.2 million from $5.1 million, on sports betting average daily net revenue decreasing 17% to $45.7 thousand from $55.0 thousand, despite active sports betting player days increasing 10% to 772.2 thousand from 704.2 thousand, with a 15% increase in unique active players to 77.2 thousand from 67.2 thousand last year.
Bingo revenue surged to $13.8 million from $2.0 million last year, driven by the Cashcade acquisition. Bingo average daily net revenue increased 579% to $150.0 thousand from $22.1 thousand, resulting from a 1,140% jump to 1,448.5 thousand from 116.8 thousand active bingo player days, with a 783% surge in unique active players to 189.8 thousand from 21.5 thousand a year ago.
Looking ahead, PartyGaming said fourth-quarter trading made a strong start, in line with expectations, and the board is confident about the Group's full-year prospects
PRTY.L is currently trading down 0.64% at 280.70 pence on the LSE.
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