Pre Close Trading Update

Empire Online Limited
24 January 2006


Empire Online Limited Pre-Close Trading Update



Strong and Accelerating growth in New Businesses



  • Number of new real money player signups were 49,788 in Q4 2005.



  • Net Gaming Revenue of $22.5 million in Q4 2005.



  • Company re-iterates confidence in $37 million pretax profit forecast for
    2006 from all gaming platforms excluding Empire Poker.



  • Strong current trading at Noble Poker, with revenue increasing by 50% in
    the first three weeks of 2006 following the initial integration of casino
    games with the poker platform.



  • Cost per acquisition of new real money players has been maintained at the
    lower end of the normal range at $225 (Q3 2005 : $236).



Empire Online Limited (the 'Company' or 'Empire Online'), a leading online
gaming network and provider of marketing services to the online gaming industry,
today provides the following trading update for the fourth quarter of 2005.


During the fourth quarter of 2005 the Company has increased the marketing of its
Club Dice and Noble Poker platforms which has in turn delivered a rapidly
accelerating rate of new player sign ups. Trading at Noble Poker has been
especially strong so far in Q1 2006 following the initial integration of casino
games within the poker platform. Further game play enhancements are anticipated
in the near future.



Q4 Trading Performance



Q4 has seen rapid growth in the platforms recently acquired by the Company; the
Club Dice suite of casinos and Noble Poker. In aggregate, Empire Online saw
total real money new player signups across all platforms growing by 49,788. The
company is particularly pleased in this performance as it comes in a quarter
when Empire Poker's rate of new player signups and active player base was
adversely impacted by PartyGaming separating its own skin from the system shared
by Empire Poker.com and by the departure of Coral Eurobet from the shared
tables.



Trading highlights for Q4 :



  • Number of new real money players across all gaming platforms excluding
    Empire Poker has risen by 32,419 for Q4 2005, which represents an increase
    of 23% over Q3 2005. The number of new real money players across all gaming
    platforms increased by 49,788, which represents a decline of 6% on Q3 2005
    .Non-US players accounted for over 44% of all new real money signups in Q4
    2005.



  • Total Company net gaming revenue for Q4 2005 was $22.5 million (Q4 2004 :
    22.0 million; Q3 2005: $31.4 million). Net gaming revenues across all gaming
    platforms excluding Empire Poker in Q4 2005 was $12.4 million, an increase
    of 41% on Q3 2005.



  • Total Company Casino revenue of $11.2 million (Q4 2004: $6.0 million; Q3
    2005: $ 8.4 million).



  • Total Company Poker revenue of $11.3 million (Q4 2004: $ 16.0 million; Q3
    2005: $23.0 million).



  • Estimated net operating profit before non-recurring exceptional items for
    Q4 2005 of approximately $8.5 million (Q4 2004:  $12.8 million; Q3 2005:
    $16.1 million) despite spending $2.5 million on player bonuses at Empire
    Poker to help stabilise the system.



  • Cost per acquisition of new real money players in Q4 2005 has been
    maintained at the lower end of the normal range at $225 (Q3 2005 : $236).





Key Performance Indicators (KPI's)


_______________                          Q4 '05    Q3 '05   Change      Q4 '04   Change
_______________                                                  %                    %

(1) Number of New Real
    Money Players acquired

Poker                                    30,108    37,570    (20%)      31,719    (5%)
Casino                                   19,680    15,578      26%      10,848     81%
Total                                    49,788    53,148     (6%)      42,567     17%


(2) Number of Active
    Players (a)

Poker                                   123,006   126,644     (3%)      71,466     72%
Casino                                   42,304    44,253     (4%)      32,711     29%
Total                                   165,310   170,897     (3%)     104,177     59%


(3) Average Active
    Players per Day

Poker                                    15,382    19,030    (19%)      11,570     33%
Casino                                    2,912     2,749       6%       1,421    105%
Total                                    18,294    21,779    (16%)      12,991     41%


(4) Poker Active
    Player days

Poker                                    1.42m     1.75m     (19%)       1.06m     33%


(5) Yield per raked day

Poker                                    $15.69    $21.57    (27%)      $22.63    (31%)



(a) Number of Active Players is defined as those who have played for real money
in the preceding 90 days.




Empire Poker Update



As the company reported on the 10th October 2005 in its Q3 Trading Update,
PartyGaming separated its poker platform from that of its 'skins' including '
Empire Poker.com'. Furthermore, on 11th November 2005, PartyGaming confirmed
that it had reached commercial agreement with its remaining skins, other than '
Empire Poker.com'. In consequence, PartyPoker .com players and Coral Eurobet
players no longer play on shared tables with Empire Poker.com players and Party
Poker's other skins.




Full Year Guidance



The Company expects to return profits before non-recurring exceptional items in
excess of $50 million for the full year 2005. The Company re-iterates its
confidence in achieving profits of at least $37 million for 2006 from all gaming
platforms excluding Empire Poker. At present, it is too early to determine where
profits from Empire Poker will settle for 2006 and is dependent on the outcome
of ongoing litigation.



The company will take an exceptional charge in 2005 to cover non recurring items
which are principally associated with costs incurred and an estimate of costs
which will be incurred in relation to the on going litigation against
PartyGaming plc. Non recurring costs relating to the aborted transactions with
Sportingbet plc and PartyGaming plc, IPO expenses, amortisation of share options
and impairment of intangible goodwill will also be included within this charge.



Current Trading



The company has seen continued strong trading across all its new platforms since
the beginning of the new financial year 2006. In the first three weeks up to
20th January, the company continues to see real money new player signups growing
at around 500 per day.



Commenting on today's results, Noam Lanir, CEO, said 'I am delighted in the
performance of our new platforms, which demonstrate the strength of our
marketing skills and builds on strategic acquisitions we made in Q3 2005. It is
too early to tell how full year results at Empire Poker will turn out, but the
Company has built a solid, fast growing business, that will deliver strong and
sustainable growth in the future'



For further information:

Empire Online Limited                                      [phone]

Noam Lanir, Chief Executive Officer

Andrew Burns, Chief Financial Officer

Andrew Burnett



Citigate Dewe Rogerson                                     [phone]

Simon Rigby

Sarah Gestetner

Ged Brumby


                      This information is provided by RNS
            The company news service from the London Stock Exchange