The Melbourne-based beting operator reported a 58% growth up to $287m in betting turnover, with a more than doubled gross revenue of $14.9m and a profit after tax of $3.6m, up 140%.
Betcorp said it has achieved excellent results in all business areas including sports betting, where a series of favourable results in all major sports contributed to a gross margin rate for the quarter of 8.33% (Q1 2005: 4.41%). This is significantly above long-term levels although improved trading margins were expected from the move towards a broader recreational client base.
Casino turnover was up 194% to $168m, with a gross margin of $3.1m (Q1 2005: US$1.3m). Gross poker rake was $2.1m against $244,000 in Q1 2005 and $1.9m in Q4 2005. Operating expenses were down to 33% of net revenue from players (Q1 2005:50%).
In March, Betcorp\’s shares were admitted to trading on the London\’s AIM and shortly afterwards the company raised $5.6m from UK institutional investors. The funds will be invested in future acquisitions.
Betcorp also completed the purchase of IQ-Softtech Sportsbook source code from IQ-Ludorum for a sum equivalent to three years annual license fee. Betcorp has used IQ-Softtech for five years pursuant to a licensing agreement.
A new European facing website will be launched during April under the BetBet.com label offering multi-currency payment processing with a greater emphasis on non-American sports and actively targeting customers from outside of North America.
Commenting on the results, Colin Walker, Chief Executive Officer said: “We are delighted to have started 2006 on such a positive note with a record quarterly result. The Group has moved to a new level of profitability and our AIM admission has already increased investor awareness of the Group\’s future potential.”
Elsewhere, Scientific Games announced that it has completed the purchase of Global Draw and certain related companies for $183 million. Scientific Games will also pay an earn-out to the principal selling shareholder, as well as contingent bonuses to certain members of the existing management team, based on the financial performance of the business. Global Draw will concentrate its resources to further strengthen its position as a leader of the sports betting and video lottery business in the UK and Continental Europe.
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