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Vicky Nolan

I-Gaming Investors Corner (Feb 19 - 23)

26 February 2001

UK, Irish Bookmakers Face Rocky Times
It's been a tough year so far for British bookies, which seem to be looking at falling revenues instead of huge profits. This trend started last year for several bookmaking and gaming companies, which closed the books on 2000 with gloomy figures.

The most recent announcements come from Hilton Group (HGI), whose Ladbrokes betting and gaming division profits slipped from £139.2 million to £114.9 million. E-gaming turnover for 2000 was £68.6 million, with a £10 million loss, most likely due to the company's rapid expansion across various betting platforms, along with the introduction of its online casino in October.

Hilton's complete report can be accessed by clicking here.

Hilton's downturn mirrors similar reports from competitors like Coral Eurobet and (SBT). Coral, for example, was hard hit with lucky punters during Euro 2000, which only exacerbated financial problems facing the company. Company officials are reportedly looking for an influx of cash to help make up for losses and expenditures on its Net betting ventures. Sportingbet, meanwhile, just completed a successful stock flotation on the AIM. Last week, however, the company's finance director was hard pressed to explain how the company's share price dropped 5-1/2 pence to 134-1/2 pence when he shared the company's successful third quarter reports. Third quarter profits were £458,000 based on £103.7 million in sales.

Paddy Power, the Irish bookmaker listed on the London stock exchange as Power Leisure (PWL), had better numbers to report. Pretax profits were €11 million, a 55 percent increase over the previous year's figures, and turnover was €363 million, up 35 percent over last year. The company's online betting site brought in €85 million since its June 2000 launch.

"Our focus remains on developing online interactive channels in the U.K., and continued expansion of our telephone betting and licensed betting office business in Ireland," commented CEO Stewart Kenny. The company remains adamant that unless either the British or Irish government makes changes to betting duty, the company will relocate its online operations offshore, enabling it to offer tax-free betting to its customers. Paddy Power already has moved part of its operations to Malta where it obtained a license in December.

Even more losses may loom for companies offering horserace betting thanks to the spread of the highly contagious foot-and-mouth disease, which threatened to cancel at least one meet, and may continue to affect even more. One of the worst outbreaks of the disease struck Britain in 1967, resulting in a ban on racing.

Name Change Announced
PlayStar Wyoming Corp. (PSCKF) has changed its name to PlayStar Corporation. As such, its stock symbol has also changed to PLAYF.

Wagering during the first seven weeks operation of its new Shockwave casino site has topped $8 million, exceeding company officials' expectations. "We had budgeted that during the first three months of operation we would achieve a wagering total of just over $5 million, we have exceeded that by reaching over $8 million in just seven weeks. We are all thrilled and expect our quarterly wagering to be around $12 million now," said Glynn Grummet, PlayStar managing director.


Magna Entertainment Corp. (MIEa) - Fourth Quarter, Year End Results

I-Gaming Investors Corner (Feb 19 - 23) is republished from
Vicky Nolan
Vicky Nolan