The online gaming software provider and owner of Sportsbetting.com reported a turnover of $77.3m, with a gross profit of $11.4m and an operating profit of $6.1m.
For comparative purposes, the proforma growth in turnover in the Sportsbetting.com business acquired in October 2005, was 34.3% up to $76.0m. Turnover from new and continuing licensees on a like-for-like basis was of $1.1m, representing a 57.1% growth in licensing revenue. Overall turnover from royalties and fee income decreased by 30.7% to $1.8m, with the reduction attributable to no longer receiving software royalties from the Sportsbetting business as a result of the acquisition.
On a proforma basis gross profit from Sportsbetting grew 40.1% to $10.5m, while the gross margin percentage was 13.6% compared to 12.9% for the same period a year earlier.
During the quarter, Sportsbetting.com added 19,360 new customers compared to 14,978 new customers for the first quarter of 2005. Of these new customers 49% were converted to new active betting customers compared to 47% for the first quarter of 2005. Active customer acquisition costs were $76 compared to $79 in 2005. The average loss per active customer was $326 compared to $333 for the same quarter of 2005. The average life of a customer was approximately 483 days compared to 456 days a year before. The average lifetime value of a customer at 31 March 2006 on a rolling twelve month basis was approximately $1,394.
Sports margins including horse racing were 9.3% (2005: 9.1%). Gaming margins were 2.0% (2005: 2.2%). The poker product, launched only in the middle of 2005, yielded revenue before commissions of $1.5m for the quarter. Continued growth in poker has been derived primarily from cross-selling the sports betting product, with 32.7% of sports bettors expanding their play to casino gaming and poker products in the quarter.
The licensing division added two new licensees that are expected to go live in the second quarter of 2006. Growth in the European white-label site launched in the fourth quarter of 2005 has been encouraging. The group continues to monitor further licensing and white-label opportunities, with a plan to sign an average of one quality licensee per quarter.
World Gaming enters the second quarter of 2006 well placed to strengthen its organic revenue growth in both its Sportsbetting.com business and its licensing offering.
“The first quarter of 2006 has demonstrated the value of our recently acquired Sportsbetting.com brand, through both strength in key performance indicators and the significant earnings enhancement that this acquisition has delivered for shareholders. The Group, while continuing its integration of Sportsbetting.com, continues to seek further acquisition opportunities both strategic in terms of geography or product and scalable as complementary to its existing strong operating business,” commented Daniel Moran, Chief Executive of World Gaming.
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