Slump fails to deter some online casino operators
Posted by Gavin Smith on 07 May 2009 at 10:05
Some internet casino and poker operators have declared themselves confident about the sector's long-term outlook despite the global economic slump.
888 Holdings reported disappointing trading in March, but gave a positive outlook, the Financial Times says.
The company's operating income from business to customer operations dropped eight per cent in the first quarter, and customers gambling on its site went down by five per cent compared to the previous three months.
However, the Financial Times reports business to business operation actually went up in terms of income by 13 per cent. In total, the company saw a four per cent slump in operating income to $57m (£37.8m) on the previous three months.
Other figures show that new players are not in short supply in spite of the tough economic environment, with new customer numbers climbing more than six per cent since March, and daily average revenue across the company increasing by more than three per cent on the first quarter.
Quoted by the Financial Times, Gig Levy, chief executive, said that while trading had not deteriorated further, "that doesn't mean to say there will be huge growth any time soon".
The also had some positive forecasting for the sector in hand, saying it would grow in the fourth quarter of this year. He also told the newspaper: "When you look at the bigger picture, we are still pretty bullish,
"When you look at 10 years ago and where it will be in 10 years' time, online gaming will continue to grow at a compound annual growth rate of 20-25 per cent."
He also said the firm was working on five "medium and small acquisitions of a mixture of technology companies and gaming product providers" the Financial Times reports.
Following a recent agreement between operators PartyGaming and the US authorities over liability to American laws, many expect other firms to follow suit, but Mr Levy remained cautious on 888's chances of doing this.
The Financial Times report also featured the views of Nick Batram, analyst with KBC Peel Hunt, who said business to business elements of 888 Holdings was driving growth for the most part.
But he was quoted as saying "we do not see much room for outperformance in the short term" - thanks to the stiffer business to customer climate and the current lack of a deal with the Department of Justice in the US.
