The online betting group announced a fivefold increase in pre-tax profit to £40.8m, from a gross win of £175.8m, almost doubled from the year before, and turnover of £1,526 billion, up nearly 30 per cent compared to the previous year.
Registered customers were up 1.5m to 2.7m, with an average cost of acquisition of £137 in Europe and $368 in the US.
The number of sports bets was up 50.6% to 399.9m, equivalent of 13 bets per second, up from 8 bets per second the year before.
“From where I am standing, volumes up 50% this year after being in business for seven years is something any company in any industry in any part of the world would want,” said Sportingbet Chief Executive, Nigel Payne.
91 per cent of Sportingbet’s revenues are derived from sports betting, which earned a gross margin of £71.6m from a gross win percentage of 5.0%, in line with the previous year.
With 245,215 players betting on Europe\’s regional sports betting websites, the European region has now more active customers than any other part of the group. The number of sports bets placed by these customers rose by 85.6% to 20.2m at a rate of 83 bets per active customer per annum (2004: 69 bets). The average sports bet size fell marginally to £13.3 (2004: £15.3) reflecting the company\’s increased penetration into lower staking European countries. The sports gross margin was costant at 7.9%.
Sportingbet\’s core US betting arm delivered another record year. The number of customers who bet on the region\’s sports betting websites rose by 31.4% to 188,856. The number of sports bets placed by these customers rose by 33.7% to 25.4m at a rate of 135 bets per customer per annum (2004: 132 bets). Both the average sports bet size ($58) and the sports gross margin (6.1%) were costant.
In the Australian region, the local management team continued the transition of the business from being a telephone based betting operation to one in which internet betting is increasingly important. For the first time the percentage of bets taken over the internet has surpassed the ones taken over the phone (60.1% respect to 43.1% the year before). The increased internet focus together with improved sports results, have increased the sports gross margin to 2.3% (2004: 1.7%).
On the online poker front Paradise Poker contributed £28.4m to overall operating profit. Paradise Poker’s active customers rose by 88.5% to 212,000, while the average number of games jumped 66.3% to 1.0m and the average daily rake rose 88.8% to US$283,824. The cost of acquiring new active customers to Paradise Poker has remained broadly constant at $139.
“The benefits of the increased scale of our business across a multi-product ‘one-stop shop’ environment have been clearly demonstrated,” said Chairman Peter Dicks.
“Important indicators such as customer acquisition cost, bet size, bet frequency and attrition, have either remained in line with last year or in some cases improved,” said the Chief Executive, Nigel Payne.
“The stability of these indicators demonstrates the power of our multi-product, global offering, and our ability to drive organic growth cost efficiently, without compromising the quality of the customer we attract.”
Payne envisages further consolidation in the online betting industry and said the company remains on the lookout for acquisition targets.
The share price, which tumbled 22 per cent in the last month amid concerns of revenue slowdown at online gaming companies, close the trading day nearly 9 per cent higher at 313.5p.
Sportingbet was eager to announce that poker revenues were at all-time highs in the latest 10 weeks and that following an “intensive” marketing campaign, the company signed up 37,680 new active poker customers at an average cost of $132. By contrast, PartyGaming spends $286 to attract new players to its site.
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