Bwin.party banks on mobile launches for 2014 growth
Operator reports in line with revenue expectations in trading update and confirms non-executive chairman Simon Duffy plans to step down
Bwin.party said the roll-out of its new mobile sportsbook during H1 2014 would boost growth after a steady end to the year that saw revenues in line with management expectations and the successful launch of its poker and casino products in New Jersey.
In a pre-close trading update released this morning bwin.party said the nine weeks since 30 September had been broadly positive, boosted by the launch of its new poker client which is now available to around 65% of its customer base.
The UK-listed operator now expects EBITDA margins for the year ended 31 December 2013 to be between 16-17% of total revenues.
Bwin said mobile now represents around a quarter of sportsbook revenues, and said its long-awaited sportsbook had gone live in Spain on December 16 ahead of a wider launch next year.
It also said casino would launch with a “much improved mobile offer in our core markets in Q1 2014″ and it expected further growth through the channel as a result.
The firm added it has also continued its shift to regulated markets with 52% of average net daily revenue now derived from “nationally or taxed” jurisdictions.
Gross win margins in sports betting remained strong in the period, however betting volumes fell due to international football games disrupting the normal football calendar, the company said.
The launch in New Jersey, which cost between 7-10m in the period, has seen its PartyPoker site lead the market in terms of cash game players according to rankings site Pokerscout.com. iOS applications for casino and poker are also ready for launch in the US state.
Bingo appeared to be on the up after a disappointing year, with revenues increasing compared to the previous quarter.
The figures come on the back of disappointing Q3 revenues announced in November, which fell by 21% year-on-year as all four verticals deteriorated.
Peel Hunt analyst Nick Batram said there was plenty of reason for optimism in 2014, with new product and platform launches in the pipeline, along with the welcome boost of the World Cup.
However he added that bwin.party’s management has a lot to prove. “We remain to be convinced about its ability to ultimately deliver,” he said.
“For that reason we see bwin.party as a trading situation, rather than a fundamental Buy. If the current management team cannot unlock the inherent value in a business, then someone else could.”
Meanwhile the operator also revealed that non-executive chairman Simon Duffy will not stand for re-election at the company’s next AGM in May 2014.
Duffy has served on the board for more than trhee years, overseeing the integration of bwin and PartyGaming merger in 2010. A formal search process to find his successor is underway.
“The Group has faced numerous challenges over the past three years, but most of them are now behind us and I am confident that, under the leadership of Norbert Teufelberger, bwin.party is well-placed to return to growth by capitalising on its strong market position, leading brands and proprietary technology,” Duffy said.
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