Online gambling company bwin.party digital entertainment plc released information about its financial performance during the first quarter of 2015. The operator’s overall revenue fell 6% year-on-year to reach €155.3 million.
During the period in review, nationally regulated and taxed markets generated 62% of the total revenue. In comparison, revenue from those accounted for 56% of the revenue posted for the first quarter of 2014. Mobile revenue represented 30% of this year’s first quarter gaming revenue compared to 17% for the same period in 2014.
bwin.party’s average daily net revenue dropped 13% year-on-year. This was attributed to lower gross margins in sports betting than initially expected, a decrease in revenue from poker operations, as well as the newly introduced VAT to particular gambling activities across the European Union.
Net revenue from sports betting decreased 10% year-on-year to €58 million during the three-month period ended March 31. The decline was mainly attributed to unfavorable football results.
The company’s casino and other games generated net revenue of €46.8 million, down 11% as compared to what was posted for the same period a year ago. The decrease was due to the introduction of VAT. Yet, bwin.party pointed out that the amounts wagered by customers increased 1% to €1.7 billion.
A decrease was also posted in the company’s poker operations. It was attributed to increased bonus costs due to a newly launched player reward program.
bwin.party’s bingo operations in the UK remained strong during the reported period. The company pointed out that new player sign-ups increased 24% year-on-year. Furthermore, the launch of a marketing campaign in the UK resulted in an 8% increase in gross gaming revenue.
Other operations generated revenue of €19.9 million compared to €10.3 million for the first quarter of 2014. The considerable growth was primarily attributed to a licensing agreement that the World Poker Tour signed in Asia as well as to Kalixa’s strong performance. bwin.party announced that its payment department has developed and is about to launch a new social mobile wallet solution.
Norbert Teufelberger, Chief Executive Officer of the gambling operator, commented that the lower than expected sports betting gross win margin and the decrease in poker operations attributed to the decrease in overall revenue. Yet, he pointed out that the EBITDA margins exceeded the Board’s expectations.
Mr. Teufelberger also noted that bwin.party’s US platform has secured partnerships with California and Pennsylvania and the company is ready to introduce its services in both states, provided that online gambling gets legalized there.
Earlier this week, bwin.party announced that it is currently reviewing takeover proposals from several gambling operators, with 888 Holdings and GVC Holdings being among those. The company, however, pointed out that the discussions over the proposals might not result in a transaction. A decision is expected to be made within the course of the next few weeks.
