Market Briefs

Probability Turns toward Profitability

Probability, the London mobile gambling operator, finished 2007 profitably on reduced losses and strong growth in gaming revenue -- a year Chief Executive Charles P. Cohen called "transformational."

Net gaming revenue, which comprises the majority of the company's total revenue, was up 152 percent to £3.1 million, with gross operating margins up to 75 percent from 46 percent a year ago.

When asked about the strength of margins, Mr. Cohen told IGamingNews Thursday:

"I think that these kinds of margins follow from your strategy, particularly depending upon how high up you are in the supply chain. We are vertically integrated, meaning we control most of the supply chain. That means you attract -- and need -- high margins."

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Weekly Statistics from Bloomberg.com

Listing

Low Close: 44 pence (87 cents)

High Close: 46 pence

Weekly Change: + 4.5 percent

Market Capitalization: £8.3 million ($16.6 million)

ISWI Treading Fine Financial Line

Interactive Systems Worldwide Inc., a New Jersey I-gaming software developer, has revised its licensing and support agreement with Mexico's Hipodromo de Agua Caliente, raising fresh questions about the company's long-term financial stability.

In the original agreement, inked in August 2006, ISWI agreed to supply Caliente's betting shops with in-running betting services. Under the revised agreement, however, ISWI's in-running services will no longer run in Caliente's shops but online.

The new Caliente-branded site is expected to launch in time for the 2008 N.F.L. season, which begins Sept. 4. Caliente, a gambling operator, maintains 160 shops across Latin America.

For its part, ISWI is to receive an upfront payment, as well as monthly license fees based on revenue that Caliente generates -- further financial details were not disclosed.

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Weekly Statistics from Bloomberg.com

Listing

Low Close: 30 cents

High Close: 33 cents

Weekly Change: - 9 percent

Market Capitalization: $3.7 million

Trading Turnaround Continues for 32Red

Having lost 41 percent of its share value in the year to date, 32Red of Gibraltar quietly gained 8.5 percent Wednesday on the back of an upbeat first-half trading update.

Total gaming revenue came in at £6.6 million, up 26 percent against the previous-year period and 32 percent against the second half of the 2007 fiscal year.

Casino, where the company derives the lion's share of its revenues, totaled £6 million, an increase of 31 percent versus the first half of 2007 and 38 percent against the second. Active players were up 14 percent with a 15.3 percent increase in yield per player.

In an increasingly competitive environment, 32Red's poker business was stagnant during the first half. Revenue, which came in at £600,000, remained unchanged against the first and second halves of 2007. Active players and yield per player were down slightly.

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Weekly Statistics from Bloomberg.com

Listing

Low Close: 23.5 pence (48 cents)

High Close: 25.5 pence

Weekly Change: + 8.5 percent

Market Capitalization: £17.50 million ($34.8 million)