The guessing about how much party is making is over!!!

[_And1_]

Result for 2004 $391'', estimate was at $350''.

The introduction is estimated at july this year, and for a value of $10'''. This will make Party Gaming the largest "game"company, second biggest for comparision Sportingbet PLC (owners of Paradise Poker) have a value at $2'''.

Note that partys report was showing a nettomargin at 65% , as turnover was "only" $602''!

[Sintax]

As an engineering student, I missed out on all the economics and business classes in college.

If Party grossed 1 billion and profited 390 mil, does that mean they had about a 35% profit margin?

I googled it real quick and this came up on Motley Fool:


[ QUOTE ]
Net Profit Margins

Average net profit margin for S&P 500 companies ...... 7.0%
Average net profit margin for all Nasdaq companies ... 3.1%



[/ QUOTE ]

If thats correct, I really hope this market corrects itself sooner than later.....

[nsdjoe]

[ QUOTE ]

If Party grossed 1 billion and profited 390 mil, does that mean they had about a 35% profit margin?

I googled it real quick and this came up on Motley Fool:


[ QUOTE ]
Net Profit Margins

Average net profit margin for S&P 500 companies ...... 7.0%
Average net profit margin for all Nasdaq companies ... 3.1%



[/ QUOTE ]



[/ QUOTE ]

great googley-moogley!

[Octopus]

[ QUOTE ]
you are assuming net profit = rake, which is very false. Party needs to pay the salaries of all employees, bonuses, advertising, etc....all of this reduces rake (essentially, sales) into profit.

Party's rake last year was estimated to be around $1B. A net profit figure of $391M is a huge net profit %, but it not that surprising.

[/ QUOTE ]

My guess is that Party's single biggest expense is the share of the rake that goes to the skins. I am making these numbers up (someone who knows better can correct me), but if half of the players on 'Party' are actually playing on skins and those skins collect half the rake generated by their players, then that accounts for $250M of the $609M in estimated expenses. The vast majorty of the rest is probably bonuses, affiliate payments and other advertising. The 'corporate overhead' is miniscule.

I would like to know how many unique active players (played in the last month, say) they have. I'm sure that and much else will come out in the IPO process.

[Weebl]

Congratulations Dikshit!!!!

[Cubswin]

Was in a bit of a hurry this morning so i couldnt post the entire article then.... but here it is now....

Party unveils profits as it moves towards IPO

Poker giant Party Gaming has revealed 2004 profits of US$391m and appointed two non-executive directors in a sure sign it is going ahead with a US$10bn listing on the London Stock Exchange this summer.

Unaudited EBIDTA profits for Party Gaming, before share option expenses, are ahead of market expectations of US$350m, and are also a stunning 65% of annual revenues of US$602m.

The firm, which is the parent company of Party Poker, is now widely expected to push ahead with plans for an IPO in July.

The valuation of Party Gaming is believed to be in the region of US$10bn, which will make it the largest listed online gaming company at five times the size of Sportingbet.

Party made the announcement after completing its strategic review, which was undertaken by investment banks Investec and Dresdner Kleinwort Wasserstein (DrKW).

But the firm said it has solely retained DrKW to advise on the potential float to the surprise of some analysts who had expected both banks to handle what will probably be the largest IPO on the London Stock Exchange this year.

A well placed city source has reported Investec pulled out of its relationship with Party.

But the firm said there was no truth to the market rumours and it still had a good relationship with the bank.

A Party spokesman would not confirm plans for an IPO, but a successful listing would be hugely important for the egaming sector.

Several major egaming firms, including Party’s Gibraltar neighbours Cassava Enterprises, are known to be keen to go public.

And many smaller firms who are looking at a listing will watch how the market receives the party listing with great interest.

Party's appointment of two heavyweight non-executive directors is also a significant step in the direction of an IPO.

Michael Jackson, currently chairman of software firm Sage Group, was named as non-executive chairman.

And Brian Larcombe, formerly chief executive of venture capital fund 3i Group, was named as non-executive deputy chairman.

[SomethingClever]

[ QUOTE ]
Congratulations Dikshit!!!!

[/ QUOTE ]

POTD!!!!!!!!!!!!

[Rudbaeck]

[ QUOTE ]
[ QUOTE ]
Net Profit Margins

Average net profit margin for S&P 500 companies ...... 7.0%
Average net profit margin for all Nasdaq companies ... 3.1%



[/ QUOTE ]

If thats correct, I really hope this market corrects itself sooner than later.....

[/ QUOTE ]

I've been preaching that economic theory dictates that Party is going to make alot less money per customer over the coming years. You just can't sustain this kind of profit margin in a free market.

[kenberman]

could you post the link?

[og5]

[ QUOTE ]

I've been preaching that economic theory dictates that Party is going to make alot less money per customer over the coming years. You just can't sustain this kind of profit margin in a free market.

[/ QUOTE ]

Party is a virtual monoploy right? What kind of margins are Microsoft and other monpolies averaging?