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Bwin's First Half Results Sag

Internet betting giant Bwin.Party Digital Entertainment has released its first half 2013 financial results, noting lower revenues, and losses.

Key financial indicators for the half ending June 30th, 2013 were:

  • Total revenue down at €342.5 million (H1-2012: €410 million)

  • EBITDA down at €60.7 million (H1-2012: €85.6 million)

  • Loss after tax at - €11.6 million - less painful than H1-2012's - €21.3 million loss.

  • Sportsbook revenue down at €118.3 million (H1-2012: €128.1 million)

  • Casino and games revenues down at €110.8 million (H1-2012: €139.7 million)

  • Poker down at €62.3 million (H1-2012: €96.4 million)

  • Bingo down at €27.2 million (H1-2012: €31.5 million)

Commenting on his company's performance, Bwin CEO Norbert Teufelberger said: “The first half was always going to be a challenge as we set about optimising the shape and size of our business, with a much greater focus on nationally regulated and to-be-regulated markets. As predicted, this meant that revenues declined but it also meant that we could make further substantial reductions in our cost base."

"However, our performance and revenue is behind where we expected it to be at this point. This is partly due to external factors but also due to operational challenges associated with our dotcom migration in December 2012."

“Our move to Agile is starting to produce benefits in terms of productivity, speed of development and implementation. Over the next twelve months we expect to double the number of software releases whilst continuing to improve product quality and platform stability."

“Our new PartyPoker product is ready for launch, firstly into the dotcom environment and then into our core nationally regulated markets. The launch will reposition the PartyPoker brand ahead of the opening of the US market and revitalize the product, ensuring that it more than meets the expectations of today’s recreational digital consumer."

"Also to come in 2013 is a brand new mobile interface in sports; a new social sports betting app that we have developed with Nordeus; the launch of premium.com, a new service focused on high value customers; and PartyPoker’s next phase of development when we will introduce additional features for the casual player."

Other highlights for Bwin during the half were:

  • Company set to save €70 million in costs this year, and up to €20 million in 2014

  • Online gambling license application filed with New Jersey regulator, and systems being installed in Borgata Casino ahead of planned launch in November 2013.

  • Launch of "all-new version of PartyPoker" imminent.

  • EBITDA reflects the impact of a turnover tax on sports betting in Germany, ISP blocking in Belgium and the closure of slots in Spain

  • Full year revenue expected to be between 14% and 17% below that of 2012 with clean EBITDA margins likely to be 2% lower than 2012 (excluding revenues and costs associated with a US launch).

Speaking about the first eight weeks of the second half, Teufelberger noted: “In the eight week period ended 25 August 2013, average net daily revenue was down 8% versus the second quarter of 2013 and down 21% versus the same period in 2012."

"An improving position in sports betting in August has been hampered by ISP blocking in Greece and a short delay in the launch of our new poker product. However, we expect to see further benefits from our cost reduction program to come through by the end of the year and into 2014."

“We now expect full year revenues, excluding the US, to be between 14% and 17% lower than 2012 with clean EBITDA margins, again excluding the US, likely to be 2% lower than last year."

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