Q3 KPI's and IMS

RNS Number : 5104V

888 Holdings plc

03 November 2010

 



3rd November 2010

888 Holdings Public Limited Company ("888")

Interim Management Statement

Q3 2010 Key Performance Indicators and Trading Update*

888, one of the world's most popular online gaming entertainment companies is pleased to provide the following trading update for the third quarter of 2010.

Financial Highlights

·      Total Operating Income US$61million, stable compared to Q2 2010

·      Total Operating Income B2C at US$51 million, up 6% year on year and stable compared to Q2 2010

·      Total Operating Income B2C during the first nine months of the year at US$162 million, an increase of 14% compared to 2009

·      Total Operating Income B2C Bingo during the first nine months of the year at US$36 million, an increase of 356% compared to 2009

·      Total Operating Income B2B during the first nine months of the year at US$29 million, an increase of 6% on a pro-forma basis**

* All percentages in this release are calculated without rounding.

** See appendix.

Operational Highlights

B2C

·      Award of licence by Autorité de Régulation des Jeux En Ligne (ARJEL), the French Gaming regulator, to operate poker betting websites

·      New Bingo B2C network launched in Sweden

·      New Poker TV campaign launched in the UK showing strong new customer recruitment results

·      Re-launch of £8,888,888 Pirates Millionaire free spin slot machine coupled with UK TV campaign

·      Bingo TV campaign launched in the UK

·      As at 30 September 2010, 888 had 8.2 million Casino, Poker and Sport real money registered customer accounts, representing an increase of 21% since 30 September 2009

 

Dragonfish

·      Free play World Series of Poker (WSOP) offering launched in the United States for Harrah's Interactive Entertainment (HIE), following the successful launch of a real money WSOP-branded site in the UK

·      Agreement signed with Microgame for the provision of a comprehensive casino product to the Italian gaming market

·      Joint liquidity poker network launched in France with Microgaming. The poker network now has three partners live, with a fourth to be added in coming weeks

·      David Zerah appointed as Managing Director

Key Performance Indicators

Third Quarter 2010

Group

·      Total Operating Income US$61 million (Q3 2009: US$61 million)

·      As at 30 September 2010, 888 had 8.2 million Casino, Poker and Sport real money registered customer accounts, representing an increase of 21% since 30 September 2009

B2C

·      Total Operating Income B2C at US$51 million (Q3 2009: US$48 million), a 6% increase

·      Total Operating Income B2C Casino at US$27 million (Q3 2009: US$29 million), a 9% decrease

·      Total Operating Income B2C Poker at US$8 million (Q3 2009: US$12 million), a 34% decrease compared to Q3 2009 in line with industry trends but encouragingly a 3% increase compared to Q2 2010

·      Total Operating Income B2C Bingo at US$13 million (Q3 2009: US$3 million), a 344% increase compared to Q3 2009

·      Total Operating Income B2C Emerging Offering at US$4 million (Q3 2009: US$3 million), a 10% increase

·      Number of active customers B2C Casino and Poker at 165,000, stable compared to previous quarter

·      Number of active customers B2C Casino at 73,000, an 8% increase compared to previous quarter

·      Number of active customers B2C Poker at 115,000, a seasonal decrease of 5% compared to previous quarter

·      Quarterly Total Operating Income B2C per active Casino and Poker customer at US$211, an increase of 2% compared to previous quarter

·      Quarterly Total Operating Income B2C per active Casino customer at US$362, a decrease of 7% compared to previous quarter

·      Quarterly Total Operating Income B2C per active Poker customer at US$71, an increase of  8% compared to previous quarter

Dragonfish

·      Total Operating Income  B2B at US$9 million (Q3 2009: US$13 million), a decrease of 27% but representing a stable performance on a pro-forma basis

Nine Months ended 30 September 2010

Group

·      Total Operating Income US$191million (2009: US$179 million), an increase of 7%

B2C

·      Total Operating Income B2C at US$162 million (2009: US$142 million), an increase of 14%

·      Total Operating Income B2C Casino at US$86 million (2009: US$85 million), an increase of 1%

·      Total Operating Income B2C Poker at US$28million (2009: US$39 million), a decrease of 28%

·      Total Operating Income B2C Bingo at US$36million (2009: US$8 million), an increase of 356%

·      Total Operating Income B2C Emerging Offering at US$12 million (2009: US$10 million), a 20% increase

Dragonfish

·      Total Operating Income  B2B during the first nine months of the year at US$29 million (2009: US$37 million), a 21% decrease representing a 6% increase on a pro-forma basis

Current Trading

Trading during October was stronger than the third quarter across all business lines. Average daily revenue increased by approximately 6%, led by poker showing a more than 16% increase. This revenue increase was driven by higher deposit levels and more active players, with a significant increase in new customer recruitment of over 20%.

This increase has been driven in part by the continued investment in 888's brands, with TV campaigns in Casino, Poker and Bingo in the UK.

Overall, current trading remains in line with the Board's expectations and the Board expects the trading performance for the current financial year to be in line with consensus forecasts. In order to ensure consistency of forecasting the Board is providing guidance for depreciation, amortisation and taxation for the year 2010 as set out below:

Depreciation	$8.9 million (2009:$7.0 million)
Amortisation	$3.6 million (2009: $1.5 million)
Taxation	$3.2 million (2009:$2.7 million)

Material Events, Transactions and Financial Position

There have been no material events, transactions or changes in the financial position of 888 since the year end other than as set out above.

As at 30 September 2010 the group had US$62 million of cash and cash equivalents (of which US$33 million represent liabilities to customers) and no debt.

Commenting on today's announcement, Gigi Levy, Chief Executive Officer, said:

"We are pleased with the results achieved during the third quarter. Our business showed resilience during the historical seasonally weak summer period, with growth in Poker. The fourth quarter has started well and given that our various business initiatives are progressing as planned we expect to grow the business further during the year."

Analyst and Investor Conference Call

Gigi Levy, Chief Executive Officer and Aviad Kobrine, Chief Financial Officer, will be hosting an analyst and investor conference call at 10.00am (GMT) today.

Dial-in number:	[phone]
Passcode:	3439752
Replay number:	[phone]
Replay passcode:	3439752

-ends-

Contacts and enquiries

888
Gigi Levy, Chief Executive Officer	[phone]
Aviad Kobrine, Chief Financial Officer	[phone]
M:Communications
Ann-marie Wilkinson/Andrew Benbow	[phone]

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". By their nature, forward-looking statements involve risk and uncertainty since they relate to future events and circumstances. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements in this announcement reflect 888's view with respect to future events as at the date of this announcement. Save as required by law or by the Listing Rules of the UK Listing Authority, 888 undertakes no obligation publicly to release the results of any revisions to any forward-looking statements in this announcement that may occur due to any change in its expectations or to reflect events or circumstances after the date of this announcement.

Appendix

Set out below are 888's unaudited key performance indicators for the period Q1 2009 to Q3 2010. Comparative Results for 2010 are presented on a pro forma Basis.

Following the acquisition of Wink Bingo, commencing on 1^st January 2010 the revenue generated by Wink Bingo is reported as part of B2C revenue and is excluded from B2B revenue. In addition, from 1^st January 2010, as a result of revisions to contractual arrangements the revenue generated by several B2B licensees, previously recognised on a gross basis, is now recognised on a net basis. In order to enable a like for like comparison, a pro-forma table is set out below showing 888's KPIs in 2010 as if these changes did not take place.

US$m*	2009				2010
	Q1	Q2	Q3	Q4	Q1	Q2	Q3
B2C TOI
Casino	26.7	29.2	29.4	33.4	32.8	26.5	26.6
Poker	13.7	12.5	12.5	12.9	11.6	8.0	8.2
Bingo	2.4	2.7	2.8	2.8	10.9	12.6	12.5
Emerging Offering	2.4	4.0	3.5	4.5	3.5	4.4	3.9
Total  Operating Income B2C	45.1	48.4	48.2	53.6	58.8	51.6	51.2
B2C KPI
TOI Casino US$m	26.7	29.2	29.4	33.4	32.8	26.5	26.6
Active Players Casino (000)	62.1	66.5	62.4	67.9	76.9	68.1	73.4
TOI Casino per active player US$	$ 429	$ 439	$ 471	$ 493	$ 426	$ 390	$ 362
TOI Poker US$m	13.7	12.5	12.5	12.9	11.6	8.0	8.2
Active Players Poker (000)	133.1	142.4	133.8	131.9	167.9	121.5	115.3
TOI Poker per active player US$	$ 103	$   88	$   93	$   98	$  69	$  66	$  71
TOI Casino & Poker US$m	40.4	41.8	41.8	46.3	44.4	34.6	34.8
Active  Players Casino & Poker (000)	167.7	179.7	168.5	172.7	217.8	167.2	165.3
TOI Casino & Poker per active player US$	$ 241	$ 232	$ 248	$ 268	$ 204	$ 207	$ 211
B2B TOI
Total B2B Operating Income	11.9	12.4	12.7	14.3	10.4	9.5	9.3
Total Operating Income	57.0	60.9	60.9	67.9	69.2	61.0	60.6

Pro-forma

US$m*	2009				2010
	Q1	Q2	Q3	Q4	Q1	Q2	Q3
B2C TOI
Casino	26.7	29.2	29.4	33.4	32.8	26.5	26.6
Poker	13.7	12.5	12.5	12.9	11.6	8.0	8.2
Bingo	2.4	2.7	2.8	2.8	3.0	3.5	3.0
Emerging Offering	2.4	4.0	3.5	4.5	3.5	4.4	3.9
Total  Operating Income B2C	45.1	48.4	48.2	53.6	50.9	42.5	41.7
B2C KPI
TOI Casino US$m	26.7	29.2	29.4	33.4	32.8	26.5	26.6
Active Players Casino (000)	62.1	66.5	62.4	67.9	76.9	68.1	73.4
TOI Casino per active player US$	$ 429	$ 439	$ 471	$ 493	$ 426	$ 390	$  362
TOI Poker US$m	13.7	12.5	12.5	12.9	11.6	8.0	8.2
Active Players Poker (000)	133.1	142.4	133.8	131.9	167.9	121.5	115.3
TOI Poker per active player US$	$ 103	$   88	$   93	$   98	$   69	$  66	$  71
TOI Casino & Poker US$m	40.4	41.8	41.8	46.3	44.4	34.6	34.8
Active  Players Casino & Poker (000)	167.7	179.7	168.5	172.7	217.8	167.2	165.3
TOI Casino & Poker per active player US$	$ 241	$ 232	$ 248	$ 268	$ 204	$ 207	$  211
B2B TOI
Total B2B Operating Income	11.9	12.4	12.7	14.3	13.8	12.7	12.5
Total Operating Income	57.0	60.9	60.9	67.9	64.7	55.2	54.2

 

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