Poker helps 888 record 'stellar' second quarter
B2C poker revenues rise 58% year-on-year due to the success of the company's Poker 6 platform, with player numbers up 90%.
A phenomenal rise in B2C poker numbers has resulted in 888 reporting a set of “stellar” second quarter figures with year-on-year revenue growth up 29% to US$79m.
B2C poker revenues reached US$13m, a 58% increase compared to the same period last year ($8m) due to the success of its new Poker 6 platform, while casino revenues also performed strongly up 34% to $36m compared to $27m in Q2 2010.
Since the launch of Poker 6 in June last year the operator has seen a huge leap in player numbers rising 90% to 231,000 active customers compared to Q2 2010. Casino player numbers also climbed to 159,000, a year-on-year rise of 134%.
“Since the launch of Poker 6 we have outperformed the industry, while we have also benefited from the Full Tilt [shutdown] and doubled our customer recruitment, now enjoying sixth position in the global liquidity rankings,” said Brian Mattingley, 888’s deputy chairman in charge of finding a successor to former CEO Gigi Levy who left the business in April this year.
“This quarter has seen strong performance in B2C for 888 especially in poker and casino. We have been focused as ever on our goals – further bolstering our B2C performance and leveraging our industry-leading offerings, while maintaining our Dragonfish brand presence and B2B deal pipeline,” he added.
James Hollins, analyst at Evolution Securities, called the results “stellar” and said 888 was “reaping the rewards” of investment in its poker platform with a “differentiated product” that has seen poker actives rise by 90% year-on-year.
“There is no mention of margin (ie. the relating technology and investment marketing costs that have driven the top-line increase), although we are confident that the group can beat our current full year estimates,” Hollins added.
Quarterly revenue per active casino and poker customer however, was $141, a 32% decrease compared to Q2 2010. Quarterly revenue per active casino customer was $223, a sharp 43% decrease, a result of “significant expansion in new customer recruitment coupled with a significant, but slower, revenue increase”, the company said in a statement. Quarterly revenue per active poker customer was $55 a 17% decrease compared to Q2 2010.
Dragonfish, the operator’s B2B arm, saw revenues increase 28% to $12m from $10m.
Group revenue in the first half of this year stood at $154m, an increase of 18% compared to the first half of 2010 ($130m).
Mattingley added that while the “excellent figures” reported today give the board confidence of future growth, he added the second half of the year would be impacted by the company’s need to “invest in regulating markets as these open up”.
“However, despite the second half including the seasonally weaker summer trading period, and after taking account of the increased cost of investment we are confident, given the strength of current trading, that the company will report a financial performance for the full year to 31 December 2011 marginally ahead of current market expectations.”
Following licence approval by Italian regulator AAMS, 888 also announced its launch into the country that opened casino and cash poker on 18 July. “We are now able to offer 888 and Dragonfish services to businesses in Italy, however B2C will need [significant] investment to ensure we achieve the required amount of presence,” Mattingley said.
“We will look at an aggressive marketing campaign there and will invest heavily in the Italian market to ensure we get a recognised position,” he added.
Aviad Kobrine, 888 finance director, said its investment in Italy and Spain later in the year would impact the bottomline by “around US$2 to $3m”.