14th Dec 2006 07:01
PartyGaming Plc14 December 2006 14 December 2006 PartyGaming Plc ("PartyGaming" or the "Company" and, together with its subsidiaries, the "Group") Pre-close trading update Immediately following the passing of the Unlawful Internet Gaming EnforcementAct (the "Act") on 13 October 2006, the Group ceased to offer real money gamesto US customers. Whilst the immediate challenges following the passing of theAct were significant, revenues were stabilised quickly and more recently theGroup has begun to see improvements in a number of its key performanceindicators. Excluding sports betting, gross daily revenue in the last fourweeks of trading to 11 December 2006 has averaged approximately $921,000 per dayand overall player volumes have averaged approximately 52,000 active players perday. Gross daily poker revenues are averaging $721,000 per day, having hit a low of$637,000 per day after the Act was passed, reflecting the loss of a number ofhigher-raking non-US players to privately-owned poker sites that are continuingto offer games to customers in America and therefore, at certain times of theday, may have higher levels of player liquidity. Overall yield per activeplayer day has been affected by the loss of higher-raking players, but this hasbeen partially mitigated by strong levels of new player sign-ups that haveaveraged over 1,400 per day since the Act was passed. Gross casino revenue, including bingo and backgammon, has been steady, averagingapproximately $199,000 per day. In sports betting, Gamebookers has averageddaily gross win of approximately $65,000 per day since its acquisition on 3August 2006, whilst PartyBets was released in mid-November to a limited numberof our customers. The Group's most important market is now Europe, Middle East and Africa ("EMEA"), representing approximately 80% of total new player sign-ups and 67% oftotal gross daily revenue. The Americas, which includes Canada, Latin Americaand South America, account for approximately 15% of total new player sign-upsand 27% of total gross daily revenue. Asia Pacific remains a relatively smallcontributor to total revenue. The realignment of the Group's infrastructure is almost complete with staffreductions and other initiatives on track to realise substantial cost savings onan annualised basis. While operating margins fell significantly following thepassing of the Act, as customer volumes and revenues grow, operational gearingshould allow operating margins to increase. A total of 945 jobs have been maderedundant across the Group, representing approximately 41% of the total prior tothe Act being passed. The total cash costs associated with the restructuringare expected to remain within the previous guidance given at the time of the Q3KPI announcement on 20 October 2006. As at 30 November, the Group had total netcash (cash less interest bearing bank debt and overdrafts) of over $46.0m. The rapid development of the Group's product base has continued. PartyBets.comis now live and is being progressively marketed to our poker and casinocustomers. Virtual racing was added to the PartyCasino product range in lateNovember and PartyBingo.com was formally launched in the UK at the beginning ofthis month. The first of our multi-lingual versions of PartyPoker.com waslaunched in German on 21 November 2006 with further languages planned over thecoming months and a multi-currency offering expected in 2007. Brian Larcombe and Nigel Kenny have expressed an intention to step down from theBoard and this will take effect at the end of the year. The Board would like tothank them for the enormous contribution they have made as non-executivedirectors of the Company. The next scheduled announcement will be the Group's preliminary announcement ofresults for the year ending 31 December 2006 and will be made on 1 March 2007. Contacts: PartyGaming Plc +44 (0)20 7337 0100 Peter Reynolds, Director of Investor RelationsJohn Shepherd, Director of Corporate Communications Financial Dynamics +44 (0)20 7831 3113 Edward Bridges / Juliet Clarke Conference call Thursday 14 December 2006 For analysts and investors there will be an opportunity to put questions toMitch Garber, Chief Executive Officer and Martin Weigold, Group FinanceDirector, by way of a conference call to be held at 9.00am on Thursday 14December, 2006. The details of the call are as follows: Dial-In No: +44 (0) 1452 562 815 (UK) +1 866 629 0054 (US) Password: PartyGaming UK Replay no: +44 (0) 1452 550 000 (available for 1 week) Replay passcode: 3325254 US Replay no: +1 866 247 4222 (available for 1 week) Replay passcode: 3325254 All times are Greenwich Mean Time. This announcement includes statements that are, or may be deemed to be,"forward-looking statements". By their nature, forward-looking statementsinvolve risk and uncertainty because they relate to future events andcircumstances. Forward-looking statements may and often do differ materiallyfrom actual results. Any forward-looking statements in this announcement reflectPartyGaming's view with respect to future events as at the date of thisannouncement. Save as required by law or by the Listing Rules of the UK ListingAuthority, PartyGaming undertakes no obligation publicly to release the resultsof any revisions to any forward-looking statements in this announcement that mayoccur due to any change in its expectations or to reflect events orcircumstances after the date of this announcement. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
BPTY.L