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Australia's Jupiters Bets on Online Gaming

22 November 2001

AUSTRALIA –– As reported by (Australia) BRW: "The Brisbane and Gold Coast casino company Jupiters has a simple strategy for the next 10 years: to re-invent itself as an online gambling business. The strategy hinges on the sports-betting division, Centrebet, which doubled its revenue during the year to June 30, 2001, to $18.4 million, although that represents only 2% of the company's total turnover.

"Jupiters believes Centrebet will account for 6% of annual turnover by 2004. A German Centrebet Web site was established this year, and a Spanish-language Web site, aimed at the South American market, will be launched by June next year.

"…Jupiters recorded a strong result for 2000-01. Net profit after tax increased 14.4% to $77.1 million on revenue that grew 14.4% to $771 million. The result was fuelled by an unusually high profit of $10 million from the high-rollers business.

"Profit from high-rollers and junket business is volatile, and Jupiters booked strong winnings in the 2000 and 2001 financial years, compared with the two previous years.

"…Jupiters must find new ways of growing. Its managing director, Rob Hines, says the Australian gaming industry is saturated and `past saturation point for poker machines'.

"…He says that for Jupiters to grow, it must expand overseas.

"Centrebet, purchased by Jupiters in 1998 and based in Alice Springs, makes 87% of its annual revenue outside Australia, mainly from Europe. Clients bet on Australian and international sports events. Hines says Centrebet's growth has been fuelled by the increasing amount of sport being broadcast by pay television, rather than the growth of the internet. And because the internet is popular among people in higher-income groups, the average online bet is higher than in other forms of gambling.

"…Hines says Centrebet profit has grown at a compound annual rate of more than 60% for the past three years, growth that he says will continue.

"…Most of the Jupiters revenue comes from its wholly owned casinos - Conrad Jupiters on the Gold Coast and Conrad Treasury in Brisbane - and its 47.5% stake in Breakwater Island Trust, the owner of Jupiters Townsville…"

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