Bingo Stars,NetPlay TV,SuperCasino,Martin Higginson,ChallengeJackpot,Clive Jones
NetPlay TV has lost nearly £8m this year, following the unsuccessful trial of its Bingo Stars product on ITV.
NetPlay TV saw revenue growth of 11% in the first half of 2010 but more than doubled its losses compared to last year, following heavy investment in an unsuccessful six-month trial of its Bingo Stars product on ITV.
In April NetPlay entered into an agreement with ITV to broadcast bingo game ‘Bingo Stars’, but the new soft gaming format “did not perform in line with our expectations and has been a major cost to the company,” said Clive Jones, NetPlay non-executive chairman in a statement this morning. The statement said the first half of the year had been a “challenging time” for the company and that its losses would impact its full year results.
Total revenues were up 21% to £11.31m from £9.34m in 2009 with the company entering profitability following investment in its terrestrial teleshopping partnership with Channel Five in September 2009. However, as a result of its costly Bingo Stars venture it announced today that its losses before tax rose to £7.9m from £3.2m in 2009. NetPlay issued a profit warning in June after BingoStars failed to deliver anticipated revenues. Earnings before interest, tax, depreciation and amortisation (EBITDA) were £0.74m in the first half of this year, compared with £0.12m in the same period last year.
In today’s announcement, CEO Martin Higginson added that following the termination of Bingo Stars, staff numbers had been “reduced significantly” and that a number of non-core contracts had been “terminated”. He went on to say that NetPlay would renew its focus on its core casino assets. In an interview with eGaming Review earlier this year, Higginson admitted that NetPlay had “taken a big gamble” investing heavily in the ITV model.
NetPlay operates a number of brands, including SuperCasino and ChallengeJackpot, which it acquired from Virgin Media Television earlier this year. Total casino revenues were up 73% to £8.81m for the first half of this year compared to £5.07m in 2009.
“The ITV trial comes to an end during November 2010, and our discussions with ITV are ongoing, as is the restructuring of our business and we will update shareholders on the outcome during the next quarter,” continued Higginson.
“We have learnt a lot from this experience and we are using this knowledge to re-focus and expand our core live casino offering and return to sustainable profitability,” the statement added.