In an announcement today following the close of trade on the London Stock Exchange, PartyGaming PLC reports that, while the second quarter of 2010 remained steady despite falling slightly short of forecast expectations, earnings for the company are outpacing their results from 2009.
The second quarter for PartyGaming – which encompasses the late spring and early summer months of April, May and June – has been impacted by several factors in the online gaming economy, including the seasonal drop in the numbers of players participating in the company’s bingo, casino, poker and sports betting offerings. The 2010 World Cup, currently playing out in South Africa, has also led to a drop in the numbers of players as the world watches events unfold. Even with these two adverse conditions, PartyGaming has been able to nearly meet their previously announced financial objectives.
Over the second quarter, PartyGaming has dropped approximately 2% from its expected figures, now being reported in Euros rather than American Dollars. Even with this slight drop, the figures from 2010 are ahead of where the company was in 2009. Total revenues in the second quarter of 2010 are up 28% over the same time period of last year, primarily due to the acquisitions of Cashcade and the World Poker Tour and continued strong growth in PartyCasino.
Bingo, sports betting and PartyCasino are holding steady with their projected forecasts, with net revenue growth in PartyCasino to be up approximately 6% in the second quarter despite the usual seasonal downturn. Bingo and sports betting are looked to be steady in quarter-to-quarter comparisons by the company.
Some of PartyGaming’s movements into previously untapped markets have resulted in both good and bad news for the organization. In late June, PartyGaming was licensed in France to operate both an online poker room and a sports betting operation, but similar licensing attempts in Italy have been stalled. PartyGaming expects that the Italian regulatory agency should clear PartyGaming for operations in Italy come the fourth quarter 2010.
During the announcement, PartyGaming Chief Executive Officer Jim Ryan was understandably happy with the second quarter numbers and the overall state of the company. “We are pleased with the relatively robust performance of our business compared to many other consumer facing businesses in what remains a challenging economic environment,” Ryan stated. “Overall, the Group has performed in-line with expectations even though the adverse impact of the World Cup on our non-sports betting verticals was slightly greater than expected.”
Regarding the new regulatory state in France, Ryan noted, “We have made great progress in securing partners for our poker network in France with PMU, AB Groupe and Aviation Club de France already in place. We expect to add another significant partner to our French network in the near future. The early signs from this important new market are encouraging.”
One of the biggest moves last year by PartyGaming was the acquisition of the World Poker Tour, which Ryan believes is only the beginning of new possibilities in the United States for the company. “The World Poker Tour is performing in-line with our expectations and we believe that this asset, combined with the strength of the PartyPoker brand and the resolution of our U. S. legacy issues, ensures that we are well-positioned should online gaming become regulated in the United States,” Ryan opined. “In this respect, discussions are progressing well with a number of potential U. S.-based gaming partners.”
The latest report has drawn investors to the London Stock Market and moved PartyGaming’s stock price up since last week. On Friday, PartyGaming PLC was being traded at 206.3p and has since risen markedly. At the close of trade on Tuesday, PartyGaming PLC’s share price is quoted at 231.2p.
