25th Oct 2007 07:01
PartyGaming Plc25 October 2007 25 October 2007 PartyGaming Plc ("PartyGaming" or the "Company" and, together with its subsidiaries, the "Group") Third Quarter Key Performance Indicators and Trading update Highlights- Continuing operations - Group revenue up 24% to $115.7m (2006: $93.3m) and up 5% versus previous quarter - Poker revenue down 3% to $74.8m (2006: $76.9m) and up 3% versus previous quarter - Casino revenue up 158% to $36.7m (2006: $14.2m), and up 3% versus previous quarter - Sports Betting revenue up 91% to $4.2m (2006: $2.2m) and up 100% versus previous quarter - Board remains confident about prospects for the full year and beyond Consolidated Key Performance Indicators - Continuing operations % % change change versus versusThree months to 30 September 2007 Q2 2007 Prior year 2006Active player days (m) 6.6 (8%) 43% 4.6Daily average players (000) 72.1 (9%) 44% 50.0Yield per active player day ($) 17.4 13% (14%) 20.3Yield per unique active player in the quarter ($) 226.5 7% (9%) 249.4New real money sign-ups (000) 129.7 (18%) (14%) 150.3Unique active players during the period (000) 510.9 (2%) 37% 374.0Average daily revenue (excluding skins) ($000) 1,257.5 4% 24% 1,013.8 The Group delivered a 24% increase in third quarter revenue over the same periodin 2006 reaching $115.7m, driven primarily by continued strong growth in casino.This growth was achieved despite a 14% reduction in yield per active playerday versus the prior year reflecting the loss of a number of higher valueplayers following the passing of the US Unlawful Internet Gambling EnforcementAct ("UIGEA") in October 2006. The volume of new player sign-ups in the seasonally quiet period was down 14%versus the prior year and 18% versus the second quarter. However, this wasafter a particularly strong first half in 2007 and, for the year to date, thenumber of new player sign-ups was still 44% ahead of the same nine-month periodin 2006. The number of unique active players and daily average players bothgrew strongly year-on-year but were down versus the previous quarter which hadbeen boosted by very strong growth in new player sign-ups in the first half butalso reflected a reduction in the frequency of play, particularly during thepeak European holiday season in July and August. A recovery in player yieldsmeant that overall, net revenue per day in the third quarter of 2007 averaged$1,257,500, a 4% increase over the previous quarter and 24% above the thirdquarter of 2006. The mix of sign-ups coming from CPA1 or hybrid2 affiliates has been returned toprevious levels and as a result, the Board reaffirms its previous guidance fordistribution expenses of between 43% and 45% of revenue for the full year, withan expectation of being at the lower end of this range. In poker, total revenue was $74.8m with average net daily revenue increasing by2% versus the previous quarter to $813,200. This performance reflects a fullperiod benefit of the operational changes introduced during the second quarterof 2007 that helped to deliver a 10% increase in yield per active player dayversus the previous quarter to $13.2. As noted previously, the year-on-yeardrop in yield per active player day reflects the migration since October 2006 ofa number of high value players to competitor sites that continue to acceptplayers from the US. In terms of overall player numbers, since the end ofAugust 2007, PartyPoker's market share has remained relatively steady at around12%3. Historical poker KPI data has been restated to include the emerging gamessegment which is now managed as part of poker. For full details of allquarterly KPI data by segment please go to http://www.partygaming.com/investor/documentation.html. Casino also performed well in the quarter with total casino revenue of $36.7m.Daily net casino revenue increased by 2% versus the second quarter of 2007 andby 159% versus the third quarter of 2006. The number of unique active playersincreased by 70% year on year but fell 5% versus the previous quarter,reflecting the seasonal trends seen in poker. However, further improvement inthe mix of games away from blackjack and towards other higher yielding games,has continued to push casino yields higher, reaching $36.4 per active playerday, 7% above the previous quarter and 22% above the third quarter of 2006. Total sports betting revenue doubled over the previous quarter to $4.2m. Theyield per active player day increased from $2.6 to $6.6 reflecting a return to amore normalised gross win margin of 5.6% after a disappointing run of sportingresults in the second quarter. Betting volumes also saw an increase from $75.6min the previous quarter to $86.3m with an increase in the number of sportingevents. It is expected that betting volumes will increase further during thefourth quarter with the addition of new products to our sports betting offering. 1 Cost per acquisition ("CPA") affiliate sign-ups are those where the companypays a fixed fee to the affiliate for each real money sign-up whereas theassociated revenue benefit is received over the lifetime of the player. Thiscontrasts to revenue share affiliate sign-ups where a % of the revenue generatedby the player (minus certain deductions) is paid to the affiliate over thelifetime of the player. 2 Hybrid affiliate sign-ups are those where the Company pays a fixed fee and arevenue share to the affiliate for each real money sign-up. 3 Pokersitescout.com - note that data from this source excludes tournaments. Trading Update In the three weeks ended 21 October 2007, average gross daily revenue hadincreased by 9% from that achieved in the third quarter to $1,593,000 (Q3 07:$1,463,000) reflecting the normal seasonal pick-up seen in previous years. Inpoker (now adjusted to include emerging games), new player sign-ups averagedover 1,300 per day, and there were on average 65,000 active players per daygenerating average gross daily poker revenue of $938,000 (Q3 07: $897,000). Incasino, average gross daily revenue had increased to $569,000 (Q3 07: $514,000)while in sports betting, gross win per day had increased to $85,000 per day (Q307 $52,000). Commenting on the third quarter KPIs, Mitch Garber, Chief Executive Officer,said: "We are continuing to execute our stated business strategy and this is reflectedby our solid financial performance in the year to-date. The formation ofbusiness alliances with companies such as ITV are important steps towardsachieving our full potential and we remain confident about the Group's prospectsfor the full year and beyond." Contacts: PartyGaming Plc +44 (0)20 7337 0100Peter Reynolds, Director of Investor RelationsJohn Shepherd, Director of Corporate Communications Financial Dynamics +44 (0)20 7831 3113Edward Bridges / Juliet Clarke Conference call Thursday 25 October 2007 For analysts and investors there will be an opportunity to put questions toMitch Garber and Martin Weigold, Group Finance Director, by way of a conferencecall at 09.30 BST. The details of the call are as follows: Dial-In No: +44 (0) 1452 562 815Password: PartyGamingReplay no: +44 (0)1452 550 000 (available for 1 week)Replay passcode: 20251415# Appendix Poker* - Key Performance Indicators - Continuing operations % % change change versus versusThree months to 30 September 2007 Q2 2007 prior year 2006Active player days (m) 5.6 (7%) 44% 3.9Daily average players (000) 61.4 (8%) 43% 42.9Yield per active player day ($) 13.2 10% (32%) 19.5Yield per unique active player in the quarter ($) 174.1 4% (29%) 245.3New real money sign-ups (000) 110.4 (18%) (15%) 129.9Unique active players during the period (000) 429.7 (1%) 37% 313.6Average daily revenue (excluding skins) ($000) 813.2 2% (3%) 836.1 *includes Emerging Games segment Casino - Key Performance Indicators - Continuing operations % % change change versus versusThree months to 30 September 2007 Q2 2007 prior year 2006Active player days (000) 1,007.1 (4%) 113% 473.5Daily average players (000) 10.9 (5%) 114% 5.1Yield per active player day ($) 36.4 7% 22% 29.9Yield per unique active player in the quarter ($) 192.9 9% 52% 126.8New real money sign-ups (000) 11.3 (2%) 31% 8.6Unique active players during the period (000) 190.2 (5%) 70% 111.7Average daily revenue (excluding skins) ($000) 398.9 2% 159% 154.0 Sports Betting - Key Performance Indicators - Continuing operations % % change change versus versusThree months to 30 September 2007 Q2 2007 prior year 2006Active player days (000) 632.5 (21%) 20% 527.4Daily average players (000) 6.9 (22%) (22%) 8.9Yield per active player day ($) 6.6 154% 61% 4.1Yield per unique active player in the quarter ($) 77.8 169% 48% 52.6New real money sign-ups (000) 8.0 (40%) (32%) 11.7Unique active players during the period (000) 53.7 (27%) 29% 41.5Average daily revenue ($000) 45.4 94% 23% 37.0 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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