For the first time ever in Q1 2007 now ended, bwin Interactive Entertainment AG has achieve the goal it had pursued since 2004 of becoming the Number One world-wide, in terms of both the number of active customers and gross and net gaming revenues.
At the same time the reorientation of the company’s strategy announced two quarters ago has been successfully implemented, and significantly better results reported.
Announcing Q1 2007 results, bwin generated gross gaming revenues (sum of gross gaming revenues from betting operations, poker, casino and games) of EUR 89.4 mln. Gross gaming revenues from sports betting rose by 27.8% compared to Q1 2006 to
EUR 50.1 mln, with a sports betting margin of 9.5%.
Although the number of active customers in Q1 2007 rose by 10.7% compared to Q1 2006, from 658,000 (excl.
The decline in new active customers and less effective churn management by comparison were attributable mainly to a drastic reduction in the marketing budget.
Various inertia effects, particularly in the case of sport sponsoring, produced an unfavourable marketing mix in Q1 2007. This may persist for the next three quarters, and can only be completely optimized during the course of the coming year.
In the short term, the company announced that it could face weaknesses in the activation of customers and less dynamic growth of new customers. Apart from this, at the beginning of March 2007 the company also temporarily suspended its online gaming products in
As a result of the strategic reorientation already announced, operating expenses of EUR 67.1 mln in Q1 2007 were down by comparison to both Q1 2006 (EUR 75.3 mln) and Q4 2006 (EUR 87.1 mln), making a significant contribution to the improved results.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose to EUR 23.2 mln, an increase of 56.9% compared to Q1 2006 (EUR 14.8 mln). Operating income rose from EUR 1.5 mln in Q1 2006 to EUR 12.3 mln in Q1 2007. A profit after tax and third-party interests of EUR 9.9 mln was reported for Q1 2007, as compared to a profit of EUR 1.5 mln for the comparable period the previous year
