Unibet Group Profits Take Nose Dive

Monday May 19, 2008

The Malta-based web publication, The Independent, reported this weekend that online gambling operator Unibet Group Plc has witnessed a 73 per cent fall in net profits for the first quarter of the year to $4.37 million, due to the weakening of the British pound.

The latest results come despite the company stating that it saw a 45 per cent increase in gross revenues of $62.27 million due to the strong performance of its online gaming business, with the number of active players declining slightly to 288,161.

While currency exchanges losses of $11.14 million were recognized as an initial cause, Unibet has had growing difficulties gaining a foothold in some European markets due to draconian laws prohibiting online gambling.

"During the first quarter of 2008 we have seen healthy growth for the Group both in terms of gross winnings and in profits from operations," said Unibet chief executive officer Petter Nylander.

"With marketing costs under control, and the operational integration of Maria Holdings substantially completed according to plan, together with our new site launched in all markets, we are now focused on achieving the financial targets for 2010.

"The polarised legal and market situation between the European Union and some member states is likely to prevail short and mid-term, but is not impacting Unibet's view on achieving these targets."

Gross revenues for the quarter from sportsbetting amounted to $20.89, a 19 per cent improvement on the previous year, while revenue from Unibet Casino, Unibet Poker, Unibet Sportsbook and bingo totalled $41.58, an increase of 63 per cent. Unibet said that, of the total gross revenue, sportsbetting represented 34 per cent while casino and poker accounted for 34 and 21 per cent respectively.