Sniper
12-01-2005, 05:36 PM
LONDON (Reuters) - Online gaming firm Sportingbet <SBT.L> reported strong growth in both its number of players and first-quarter profits on Wednesday and it ruled out renewing its bid for smaller rival Empire Online <EOL.L>.
Pretax profit rose 450 percent to 14.3 million pounds in the three months to October 31.
The number of new active players increased 137 percent to 170,000.
"The benefits of the increased scale of our business across our multi-product, one-stop-shop environment have been clearly demonstrated," said Chairman Peter Dicks.
Finance Director Andrew McIver ruled out a renewed bid for smaller rival Empire Online <EOL.L>.
Sportingbet <SBT.L> aborted a 269-pence-a-share bid for Empire in September, and this month PartyGaming <PRTY.L> also ended talks with Empire over a bid at around 60 pence a share.
"We only ever really got into preliminary conversations," McIver said when asked whether Sportingbet was considering a renewed bid at a much lower price. "No, I think we've moved on from there," he added.
Analyst Paul Leyland at Seymour Pierce noted numerous positives for Sportingbet, but also cited potential difficulty with advertising in the United States, where online poker and casino games are discouraged.
"We remain concerned that media buying in the U.S. could become more difficult for betting and poker operators, which could significantly impact cost per customer," he wrote in a research note, adding that Seymour Pierce would retain its "hold" recommendation on the stock.
Sportingbet's shares rose 1.4 percent to 355 pence by 0857 GMT, valuing the group at around 1.2 billion pounds.
The group said daily commission from its Paradise Poker site rose 88 percent to $430,858 (250,222 pounds).
The new U.S.-focused electronic purse system, which players can switch between betting and poker, generated more than $2.4 million of incremental poker margin and a further $1 million of sports and casino margin in the quarter.
Pretax profit rose 450 percent to 14.3 million pounds in the three months to October 31.
The number of new active players increased 137 percent to 170,000.
"The benefits of the increased scale of our business across our multi-product, one-stop-shop environment have been clearly demonstrated," said Chairman Peter Dicks.
Finance Director Andrew McIver ruled out a renewed bid for smaller rival Empire Online <EOL.L>.
Sportingbet <SBT.L> aborted a 269-pence-a-share bid for Empire in September, and this month PartyGaming <PRTY.L> also ended talks with Empire over a bid at around 60 pence a share.
"We only ever really got into preliminary conversations," McIver said when asked whether Sportingbet was considering a renewed bid at a much lower price. "No, I think we've moved on from there," he added.
Analyst Paul Leyland at Seymour Pierce noted numerous positives for Sportingbet, but also cited potential difficulty with advertising in the United States, where online poker and casino games are discouraged.
"We remain concerned that media buying in the U.S. could become more difficult for betting and poker operators, which could significantly impact cost per customer," he wrote in a research note, adding that Seymour Pierce would retain its "hold" recommendation on the stock.
Sportingbet's shares rose 1.4 percent to 355 pence by 0857 GMT, valuing the group at around 1.2 billion pounds.
The group said daily commission from its Paradise Poker site rose 88 percent to $430,858 (250,222 pounds).
The new U.S.-focused electronic purse system, which players can switch between betting and poker, generated more than $2.4 million of incremental poker margin and a further $1 million of sports and casino margin in the quarter.