32Red earns record revenue in H1 despite World Cup distraction

32red-ed-wareGibraltar-licensed online casino operator 32Red generated record revenue in the first half of 2014 and is planning to ramp up marketing in the second half to keep the party going. Gross gaming revenue in H1 came to £22.6m, up 19% over the same period last year. The company has enjoyed significant growth since 2009, when 32Red’s full year revenue amounted to just £12.8m.

As ever, the company’s flagship casino product accounted for the bulk of revenue, with the vertical reporting a 21% year-on-year improvement to £20.7m. Mobile adoption continues to grow at torrid pace, rising from 17% of revenue last year to 32% in H1 2014. Overall player ranks grew 20% to 50,890. Revenue from 32Red’s nascent Italian operations rose 130% to £1.05m, while its active player ranks in the country trebled to 5,793.

The ‘other’ vertical, which includes 32Red’s new Kambi Sports Solutions sportsbook, fell 24% to £0.8m. Despite the 2014 FIFA World Cup, 32Red CEO Ed Ware (pictured) told eGaming Review that the sportsbook’s revenue contributions had been minimal. Ware told SBC News that it was “safe to say we will always be a casino-led business,” but Ware hopes to boost 32Red’s sports betting profile via its new shirt sponsorship with Glasgow Rangers FC, which takes effect this season, as well as its sponsorship of the last day of the Glorious Goodwood racing fixture.

To avoid drops in casino customer activity during the World Cup, 32Red reduced its external marketing and instituted a range of promotions targeted at retaining existing customers. The plan must have worked, as Ware says the company was “very happy with the results in June.”

For the first three weeks of H2, 32Red says revenue is up 45% year-on-year. To keep the momentum going, Ware says the company’s marketing budget for all of 2014 will likely top out at £10m, roughly one-third of 32Red’s projected annual net revenue.

On the international expansion front, Ware says the company is growing “lukewarm” on entering the Netherlands’ regulated market now that the country has fixed the tax at 20% of gross revenue (plus 2% for regulators and responsible gambling programs). The Spanish market is looking a lot more “palatable” now that the list of gaming options is being expanded to include slots as of January 2015.