Online gambling operator Bwin.party digital entertainment took another shot to the chin on Wednesday as its Q3 earnings figures revealed a 21% revenue fall to €145.7m. Figures for active player days, daily average players, unique active players and real-money sign-ups were all down over 20%, with the only saving graces being a 1% rise in yield per active player day and a 10% bump in yield per unique active player in the quarter. The company is pinning blame for much of the decline on Greece’s efforts to ISP-block Bwin.party’s site – and those of hundreds of other non-OPAP gambling sites – that took effect in August.
Sports betting revenue fell 10% to €52.9m, with the number of players down 20% and wagering handle down 22%. Casino revenue fell 23% to €50.1m thanks to a 34% decline in unique active players. PartyPoker continued its role as the group’s most accelerated decliner, with revenue down 37% to €23.3m. Bingo revenue fell 18% to €12.2m on “aggressive” marketing pushes by Bwin.party’s competitors in the UK and Italy. Bwin.party’s ‘other’ revenue, which includes the World Poker Tour, social gaming division Win Interactive, retail outlets and its payment services division, fell to €7.2m from €8.7m last year.
Focusing on the positive, Bwin.party claims that average daily net revenue is up 18% sequentially in the first six weeks of Q4, although it’s still down 19% when compared to the same period last year. Bwin.party CEO Norbert Teufelberger (pictured) claims this indicates that Q3’s figures represent “the floor” in terms of the company bottoming out before (ideally) picking itself up off the canvas to deliver a haymaker that saves the day in round 15. PartyPoker’s Q4 numbers are up 9% sequentially, which Teufelberger insists is evidence that the revamped software “is proving popular” with players, although its revenue remains a whopping 39% off last year’s tally.
Looking forward, Bwin.party expects the Greek ISP blocking to continue to negatively impact earnings, but the company claims it’s on track to exceed the €70m in cost savings it expected to reap via closing of operations in other ‘grey’ markets in Europe (but not Germany, from which Bwin.party earns a quarter of its bones despite its operations not being officially sanctioned by the state). Bwin.party also has high hopes for its revamped mobile casino offering, which is set to launch early in 2014.
In New Jersey, where Bwin.party has been issued a transactional waiver to commence online gambling operations when the market officially opens on Nov. 26, Bwin.party says it and its Borgata casino partner “are determined to secure a meaningful market share.” After dropping 4p immediately after the results were announced, Bwin.party shares rallied to close out the day’s trading up 5.5p to 130p, well off its 2013 peak of 156p on March 11 but significantly above its 101.3p low on Jan. 23. Most analysts chose to retain their ‘buy’ rating on the stock, although they also dropped their price target.
