NetPlay recovery continues in FY preliminary results
Focus on core live TV casino operations pays off after operator posts 12.4% increase in revenues " confirms sale of UK bingo operations.
NetPlay TV has described 2011 as a “record year” in its preliminary results for the twelve months ending 31 December 2011, reporting a rise in revenue and return to profit after a tumultuous 2010 which saw the group lose its founder and CEO, and post a significant loss.
Revenues rose 12.4% year-on-year to £22.3m, up from £19.8m in 2010, aided by strong growth in the group’s core casino business, which accounted for 92% of total group revenues, after the group announced it was going to dispose of its bingo brands and focus on developing its live TV casino operations.
The group’s former finance director Charles Butler, who replaced founder Martin Higginson as CEO in November 2010, commented that the improved results showed the success of the TV casino offering: “We are very proud of the significant strategic and commercial progress made over the past year, and the robust results announced today illustrate the strength of the Company’s live TV casino proposition.
“We are confident in the opportunities for growth available in the existing UK markets through a combination of strong customer acquisition and product development, whilst also pursuing quality international expansion opportunities. We will continue to leverage our strong broadcaster relationships to drive growth and in turn create long term shareholder value,” Butler explained.
Revenues from the casino segment rose from £17.4m to £20.6m, an increase of 18.6%. Growth was aided by a five-year deal signed with Channel 5 to broadcast SuperCasino, which was followed by the launch of live roulette on the SuperCasino iPad app in January, and yesterday’s announcement of a two-year broadcast agreement with ITV, which will see Jackpot247 screened on ITV1 for two hours a night, four nights a week.
NetPlay chairman Clive Jones explained in the group’s results announcement that the renewal of the Channel 5 deal “was a milestone for the Group as it illustrates not only the strength of the SuperCasino brand, but also that the commercial relationship between the companies is creating value for both parties and that the brand SuperCasino is going from strength to strength.”
As a result of the shift in focus the operator announced it has disposed of its UK bingo operations for £375,000 earlier this year, but did not reveal the buyer. Last year the bingo vertical was unable to match casino’s growth for NetPlay, with revenues dropping 31.5%, down from £2.5m to £1.7m for the year.
The decline in bingo was unable to halt the group’s turnaround, however; after posting a loss of £14.2m in 2010, the operator announced a £0.6m profit for 2011, with a positive EBITDA from continuing operations of £3.4m after negative EBITDA of £2.8m the previous year. This was aided by large-scale reduction in expenses, with administrative expenses cut by £11m, and sales costs down £1.3m.
Jones concluded: “I am extremely happy with the Company’s performance in 2011 and I am pleased to report that 2012 has commenced strongly with Q1 KPIs ahead of both Q1 2011 and Q4 2011.
“Furthermore, the Group is making progress with its share capital reorganisation, which if approved will create positive distributable reserves which will in turn facilitate the potential introduction of a future dividend policy. We are in a good position to drive shareholder value from our existing UK business whilst continuing to consider newly regulated market opportunities,” he said.