7th Sep 2009 07:00
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Date: |
7 September 2009 |
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On behalf of: |
NetPlay TV plc ('NetPlay TV', 'the Company' or 'the Group') |
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Embargoed until: |
0700hrs |
NetPlayTV plc
Five year airtime deal with Five
Five granted an option of 5% stake in NetPlay TV
Trading update
Five year broadcast deal with Five
NetPlayTV plc (AIM: NPT), the interactive gaming company, is pleased to announce that following a tender process it has signed a legally binding heads of agreement to enter into an initial five year commercial airtime (teleshopping) deal with Channel Five Broadcasting Limited ('Five').
Under the terms of the agreement NetPlay TV's SuperCasino.com live interactive TV show will be broadcast on Five's terrestrial channel, Five, in late night teleshopping windows. Initially the casino programme will be on air from 12 midnight until 4am three nights a week (Thursday, Friday and Saturday) starting on 17 September 2009. This will be extended to six nights a week by October this year and 7 nights from the beginning of 2010.
The agreement follows a successful one night per week, four week trial using Five's teleshopping window during which NetPlay has been able to evaluate the commercial viability of such a venture.
This agreement is a landmark deal for both parties. Five will be the first UK national terrestrial broadcaster to take advantage of the new OFCOM teleshopping rules that allow terrestrial broadcasters to air up to six hours of teleshopping in a 24 hour period. This agreement is a significant milestone for NetPlay TV, the deal with Five is the second terrestrial commercial airtime deal for the Company in as many months, following the successful launch on STV of STVcasino.com on Thursday 3 September 2009. This agreement further underpins NetPlay TV's dominant position as a trusted interactive gaming supplier.
Five granted an option of a 5% stake in the NetPlay TV PLC
As part of the deal for access to the teleshopping windows, an agreement has been reached to grant Five an option to buy 9,754,822 shares which is 5 per cent of the current total issued share capital in NetPlay TV plc.
The strike price for the options is 28.5 pence per ordinary share. The options are subject to an orderly market clause, which will run in conjunction with the agreement. The options are exercisable from the first anniversary of signing the agreement and will cease six months post termination of the five year relationship agreement.
Five is wholly owned by RTL Group, one of the world's largest media businesses with 45 TV channels and 32 radio stations in 11 countries. It is the largest media distribution company outside the USA.
Trading Update
Current turnover is in line with expectations, although short term profits have suffered as a result of exiting the premium rate telephone business, along with the delayed migration offshore of the SuperCasino.com business. The intention was to move this business offshore in April saving approximately £120,000 per month, however the decision was taken to delay the move in order to fully exploit the terrestrial opportunities. This business will now move offshore on 1 November 2009.
In order to enter into long term contracts with terrestrial broadcasters, the Company has had to ensure our "backend" software can cope with the additional traffic requirements these contracts will bring. As a result, NetPlay TV has recently signed a five year software agreement with Playtech allowing the Company to enter into these agreements with confidence.
NetPlay TV believes that the decisions taken to focus on terrestrial TV opportunities, exit the premium rate telephony business, invest in robust technology and delay the move offshore of the SuperCasino.com business have been the right ones for the long term success of the Company. NetPlay TV understands there will be an impact on this year's numbers although it is very confident the new revenue streams will be significantly larger and more sustainable going forward.
NetPlay TV will update the market fully on trading at the end of September when the Company will be able to share the results of the first few weeks of trading on both STV and Five.
Martin Higginson, Chief Executive Officer, NetPlay TV plc said:
"This year we have worked hard to ensure our business is in a position to enter into much more substantial agreements. We have strengthened our 'backend' technology with a five year software agreement with Playtech, thus allowing us to process more customers simultaneously. We have strengthened our balance sheet allowing us to enter into long term deals with confidence. We have also added new studios in Guernsey allowing us to operate in a tax efficient manner.
"The initial five year deal with Five reflects our confidence in the product and its suitability for the medium of television. The four day, four week test on Five confirmed the massive opportunity interactive TV gaming brings.
"Over the past two and half years we have developed and strengthened our product, SuperCasino.com, is the world's first truly interactive TV casino. To be broadcasting on a national terrestrial TV channel heralds a new chapter in the growth of NetPlay TV."
Damon Letzer. Commercial Director NPTV.
"We are delighted to have successfully pitched for the simulcast teleshopping opportunity on Five. We identified Five as a great home for our brand SuperCasino.com and our beliefs were confirmed in the recent test. We look forward to making this venture a real commercial success."
Kelly Williams, Sales Director of Five, said:
"The recent changes to the rules on teleshopping open up new opportunities for additional revenue streams for terrestrial broadcasters through advertising. Uppermost in our minds, however, was the need to secure a regulated product that we could offer with confidence to our viewers. During a trial period, we were satisfied by the robust nature of NetPlay TV's market-leading interactive TV casino product. Five is therefore delighted to have chosen NetPlay TV to feature in its teleshopping window."
-Ends-
Enquiries:
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NetPlay TV plc |
www.NetPlaytv.plc.uk |
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Martin Higginson, Chief Executive Officer |
Via Redleaf |
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Redleaf Communications |
Tel: 020 7566 6700 |
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Emma Kane / Mike Ward / Samantha Robbins |
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Panmure Gordon |
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Katherine Roe / Stuart Gledhill |
Tel: 020 7459 3600 |
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Channel Five Television |
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Andrew Sholl |
Tel: 07737 364 656 |
Notes to Editors:
Publication photographs are available from Redleaf Communications or www.redleafpr.com
About NetPlayTV plc
NetPlayTV plc is listed on the AIM market of the London Stock Exchange (NPT). NetPlayTV operates a number of interactive gaming services under a UK, Malta and Alderney gaming license, including 'SuperCasino.com', 'ChallengeJackpot.com', and 'Bingos.com' .
The Company is focused on the delivery of a converged interactive gaming experience allowing its customers to interact with its games on a variety of platforms, TV, Internet and mobile from a common integrated wallet.
About SuperCasino.com
NetPlayTV is able to offer a fully licensed and regulated interactive TV content. Users can interact with the live show using a fixed line telephone, the internet, or mobile phone. Once users have registered themselves, proving they are over 18, they can place bets as they would in a real casino. Once a bet has been placed the player's name appears instantly on the "live" TV show. The croupier spins a real ball in a real roulette wheel with the results broadcast "live" on TV. Any winnings are automatically credited to the winner's e-wallet regardless of which device they have used to place the bet, as well as their name appearing on the TV screen as a winner. SuperCasino.com is the World's first truly interactive TV casino.
About Five
Five is one of the UK's four public service broadcasting organisations. Since launching in 1997, it has developed a reputation for being a broadcaster with broad appeal with particular strengths in programming areas such as children's, factual entertainment, news and features. It also offers the best in acquired programming such as CSI, The Mentalist, Neighbours and Home & Away. Five, along with its two digital channels, Fiver and Five USA, is 100% owned by Europe's largest commercial broadcasting company, RTL Group.
Related Shares:
NPT.L