Sportingbet races ahead

Jun 3 2009 By nebusiness

Online gaming site Sportingbet today reported a 34% leap in third quarter earnings and said the summer had got off to a strong start despite the end of the football season.

Sports betting remained resilient in the face of the recession, helping underlying operating profits rise to £9.8m and net gaming revenues lift 8% in the three months to April 30, said Sportingbet.

The group’s traditionally quieter final quarter also kicked off well, with gross gaming revenue up 19% so far in May compared with a year ago.

Sportingbet said it was "cautiously optimistic'' over the full-year outcome, with year-to-date adjusted earnings ahead by 37% to £26m.

While sports betting has shrugged off the recession, the firm said casino and games business was lacklustre as consumers cut down on discretionary spend, with poker also continuing to struggle due to stiff competition from the US.

Football betting buoyed European amounts wagered by a third to £264.1m, although poker’s contribution remained flat at £5m and casino and gaming saw a slight rise to £9.9m.

But the group has been benefiting from the weak pound, with 90% of its revenues coming from currencies other than sterling, boosting third quarter earnings by £800,000.

It said with currency effects stripped out, net gaming revenues fell by 2%, with the amount wagered up 13% instead of 18%.

Andrew McIver, group chief executive of Sportingbet, said Sportingbet continued to make "significant progress" in growing profits.

The group has been recovering from the loss of its US-facing business after legislation two years ago, although it is continuing to hold talks with the United States Department of Justice in relation to its previous American-facing activities.

Sportingbet shares rose more than 2% following the third quarter update.