The 2009 eGaming Review Power 50: top 10

1 Bwin (1)

Key staff: Manfred Bodner and Norbert Teufelberger (pictured), co-chief executives, Joachim Baca, chief operating officer

Market cap: €900m

Half year 2009 revenues gross gaming revenues: €212.7m

EBITDA: €51m

The Vienna-based operator is once again at the top of the egaming tree in 2009. The company’s half yearly results showed gross gaming revenues up 6% to €212.7m and earnings before interest, tax, depreciation and amortisation (EBITDA) up 40% to €51m. The company has upped its full year EBITDA guidance from €100m to €110m and forecast gross gaming revenues of between €435m and €450m for the period.

Bwin has consolidated its product base and will play a strong role when regulation of the French market is up and running next year. The group also continues to sponsor major football clubs across Europe, has already renewed its Real Madrid shirt sponsorship and is a major force behind the European Gaming and Betting Association’s drive to lobby for fair and open access to Europe’s online gaming markets.

2 PartyGaming (4)

Key staff: Jim Ryan, chief executive, Martin Weigold, group finance director

Market cap: £1bn

Full year 2008 revenues: US$473m

Full year 2008 clean EBITDA: US$133m

PartyGaming might not be everyone’s cup of tea and the company usually takes its fair share of flak from industry observers and players alike. But it has reached a settlement with the US authorities over its activities there pre-internet gaming ban. It made good on its stated aim of acquiring egaming businesses when it announced the £100m purchase of top bingo firm Cashcade. Poker is struggling but Party is still the biggest standalone non-US poker site in the space and its casino continues to perform well. Clearly, the Gamebookers acquisition has not been a success and Party needs to add sports to its product base to complete its full house of egaming products. A merger with a betting operator such as Bwin or Sportingbet is often mooted as natural for those companies. Watch this space.

3 Betfair (5)

Key staff: Ed Wray and Andrew Black, founders, David Yu, chief executive

Market cap: N/A

Full year 2008 revenues: £303m

Full year 2008 EBITDA: £72m

Betfair is often described as the internet success story of the past 10 years. Founded by Andrew ‘Bertie’ Black and Ed Wray in 2000, it is no exaggeration to say it has revolutionised the way punters bet online. Its latest set of results for the full year showed a 29% rise in EBITDA and 27% rise in revenues to £303m. The company has had mixed results with its poker product but its games arcade is performing strongly and its sponsorship of the World Series of Poker Europe continues to give it pull with a major land-based event. Rumours of a float that would net the founders a cool £100m continue to do the rounds, although the company has been quick to dismiss them.

4 Bet365 (6)

Key staff: John Coates, chief executive, Denise Coates, vice-chairman and chief financial officer, Peter Coates, chairman

Market cap: N/A

2009 turnover: £3.4bn

2009 profits: £75m

“It’s a family affair” could be a good way to describe Bet365 as father Peter chairs the company and son John and daughter Denise look after the day-to-day running of the business. The company has experienced major growth as turnover has rocketed to £3.4bn in 2009 from £1.8bn last year, according to the Sunday Times. Notoriously media shy, this is because Bet365 has no intention to sell or go public and the Coates family just wants to get on with running the business, which is widely recognised as having one of the best betting product offerings and in running platforms.

5 William Hill Online (14)

Key staff: Henry Birch, chief executive (pictured)

Market cap: N/A

Half year 2009 revenues: £100m

Half year 2009 operating profit: £31.4m

It may seem unfair to include William Hill Online so high up in this year’s Power 50 after its years in the egaming wilderness, but the impact of the deal it struck with Playtech last year is bearing fruit.

As William Hill’s chief executive Ralph Topping wrote in this month’s issue of eGaming Review, the full positive effects of the migration of its casino and poker products onto Playtech have not been felt yet and the move of its online betting team to Gibraltar will enable it to make savings of around £8m-£10m a year. One of the keys to William Hill Online’s success will revolve around how all the components that make up the entity fit together.

6 Ladbrokes eGaming (3)

Key staff: John O’Reilly (pictured), head of remote betting and gaming, Ed Andrewes, managing director

Market cap: N/A

Half year 2009 revenues: £84.6m

Half year 2009 operating profit: £20.8m

Ladbrokes eGaming has not had the best of times recently, with revenues and operating profit down 5% and 20% respectively. For all that, it should not be written off and even if William Hill boss Ralph Topping told eGaming Review that Ladbrokes should have used the last few years to kill off his company when it came to egaming, don’t expect Ladbrokes to lie down and not respond. It has moved its online betting division offshore to benefit from cost savings and is actively seeking further partners to grow outside the UK and Scandinavia, its two main egaming regions.

7 Mangas Gaming (N/A)

Key staff: Isabelle Parize, chief executive, Nicolas Beraud (pictured), chief operating officer of Mangas and chief executive of Betclick, Per Widerstrom, chief executive of Expekt, Jochen Dickinger and Franz Omer, founders of Bet-at-home

Market cap: c. €500m

2009 gross gaming revenues: €200m

Expekt, Betclick and Bet-at-home make up Mangas Gaming, the newest entrant to the Power 50 top 10. The company is half-owned by Financière Lov, the investment fund set up by former Endemol France boss Stéphane Courbit and Société des Bains de Mer, Monaco’s casino operator. Mangas has acquired major scale in the past 18 months, when it took a 75% stake in Betclick and more recently with the acquisition of major Scandinavian brand Expekt and Germany and central Europe-focused operator Bet-at-home. The group is growing strongly and says it is still looking at other potential acquisition targets but it has probably made its major moves when it comes to consolidation. Much of its success will depend on how it manages to blend the three companies’ capabilities.

8 Paddy Power (8)

Key staff: Patrick Kennedy, chief executive, Breon Corcoran, managing director of non-retail and development, Chris Coyne, head of gaming

Market cap: N/A

2008 non-retail turnover: €992m

2008 non-retail gross win: €126.8m

2008 non-retail operating profit: €46.2m

Paddy Power’s non-retail activities now generate 70% of the Irish group’s overall operating profit of €75.7m. The bookmaker has embarked on an expansion strategy outside Ireland and the UK and executed it in June by acquiring a controlling 51% stake in Australian sports betting company Sportsbet for €27.2m. It then acquired the whole of International All Sports (IAS) through Sportsbet’s 20% stake in IAS for around €23m. Paddy Power was quick to point out that the regulatory certainty that Australia provided was one of the keys to the deal going ahead. The IAS-Sportsbet acquisition will ensure it has a strong foothold in a market that is already growing strongly.

9 Unibet (9)

Key staff: Petter Nylander (pictured), chief executive, Henrik Tjärnström, chief financial officer

Market cap: £417m

Half year gross win: £66.2m

Half year pre-tax profits: £16.6m

Unibet has largely recovered from a shaky 2008 and has been busy developing its product base; with Maria Bingo continuing to dominate the Scandinavian bingo scene as well as developing a poker product specifically aimed at women.

Petter Nylander is as active as ever in calling for fair and open access to Europe’s egaming markets and the company has been building up its poker base with the Unibet Poker Open. Unibet is also working on diversifying its regional focus, as much of its growth depends on Sweden and France. Unibet continues to broaden its reach through sponsorship deals, the latest ones being with Spanish Primera Liga club Valencia and French club Paris Saint-Germain to go with the media work it does with print and radio outlets.

10 Sportingbet (7)

Key staff: Andy McIver (pictured), chief executive, Jim Wilkinson, group finance director, Simon Gregory, business development director

Market cap: £290m

Turnover for nine month trading period: £1.2bn

Pre-tax profits on nine month trading period: £21.5m

Sportingbet continues its progress as one of the leading European egaming companies and is often mooted as a potential merger or acquisition target for Bwin or PartyGaming. The company has developed its Australian business nicely and has been a forerunner in emerging markets such as South Africa and Brazil. Its gaming division is the poor relation of the family, but with some gaming companies looking to develop relationships with it on that front, it has room for growth. News of a settlement with the US authorities is anticipated keenly by industry observers, as it is likely to be the trigger for consolidation moves.

To read the 2009 Power 50 positions 11-50, click here. For more on the this year’s ranking, see the eGaming Review Power 50 main feature and the Power 50 letter from acting editor Jake Pollard.

This article first appeared in the September issue of eGaming Review.