eGaming Review November 2012

F E A T U R E P O W E R 50 03 > PADDY POWER PUBLIC (3) FINANCIALS Online net revenue reached €191m for the six months to 30 June 2012 with online operating pro?t of €48.5m, up 41% and 7% respectively on 2011. As expected, last year’s acquisition of Sportsbet has seen online contribute a larger chunk of revenues, crossing the 80% threshold in 2012. Online customer acquisition rose 50% in H1, while net revenues from the egaming arm approached €200m for the period after a 41% increase. Its marketing efforts have been spectacular in the past 12 months but they have also incurred the wrath of both LOCOG (London, France campaign) and UEFA (Lucky pants campaign) in the space of just a few months, while a number of new introductions, such as social sports brand Betdash and Roller casino, demonstrate its continued desire to experiment and innovate. The operator has responded admirably to the departure of COO Breon Corcoran to Betfair, bringing in a number of senior ?gures whose appointments are indicative of a drive towards both online and the US market, where it has received a preliminary ?nding of suitability ahead of a potential Nevada licence application. S T R AT E G Y & DELIVERABILITY Sportsbet integration progressing well and online focus clear in numbers, while it leads many rivals in mobile and social. GEOGRAPHIC REACH 100% regulated: Australia proving highly lucrative, while could become ?rst European operator to receive Nevada licence. © BRAND INFLUENCE Increased with intelligent campaigns around major sporting events earning more free press and a boost in player loyalty. 88 OVERALL 100 Manchester United sign bwin.party deal 04 > BWIN.PARTY DIGITAL ENTERTAINMENT PUBLIC (4) The operator has warned that its H2 numbers for this year will likely be impacted by regulatory developments in Germany, where it generates approximately 25% of its annual revenues, and where it has been forced to apply (and pay a 5% turnover tax) for a State Treaty licence alongside its existing licence in SchleswigHolstein. Analysts have suggested 2013 should be the year bwin.party “gets its groove back”, and there have been several signs in the past year to suggest this could well be the case, including: impressive EBITDA numbers of more than €212m (H2 2011 and H1 2012 numbers combined); a soon-to-be launched inhouse built technology platform, as well as new bingo, casino and poker platforms and products; co-CEO Jim Ryan’s four-point plan to reverse declining poker revenues including merging bwin and PartyPoker liquidity; promising tie-ups in Denmark with Danske Spil, MGM and Boyd in the US; the eventual disposal of loss-making Ongame; and the launch of social gaming division Win Interactive. FINANCIALS Numbers derived from group pro forma. Generated revenue of €816m, clean EBITDA of €199.3m and an improved cash?ow of €134.6m for full year 2011. S T R AT E G Y & DELIVERABILITY Stock taken a battering over uncertainty in Germany, otherwise co-CEOs have outperformed synergy expectations. GEOGRAPHIC REACH Merger should continue to see its positions in regulated markets strengthen but faces tough competition in poker in particular. © BRAND INFLUENCE Declined since merger but as a combined entity with strong brands and the right marketing talent, should bounce back. 73 OVERALL 100 CONTINUED 43

eGaming Review November 2012 | Page 43