Online gambling company 888 has reported record 2006 earnings despite closing their entire US-facing operations following the passing of the UIGEA into law late last year.
888 is the parent company of Casino-on-Net and Pacific Poker.
Unlike their competitor PartyGaming, which saw their profits decimated by their US-market withdrawal, including a $150 million one-off charge for restructuring their business, 888 pretax profit rose by 34% to $90.5 million in 2006, up from $67.4 million in 2005. 888 pretax profit margin also rose to 31% from 25% in 2005.
888 share price bounce, as the reported profit was substantially larger than market forecasts, which ranged between $58 mil and $76 mil.
Net gaming revenues increased by 7% to $289.9 million, up from $271 million the previous year.
2007 could be another record year for 888, with encouraging revenues generated in the first quarter of this year. Net gaming revenues are up 16% in the first quarter of 2007 from the fourth quarter of 2006, driven by the rollout of new products such as Blackjack in Poker, Crazy Blackjack and localized Video Slots. However, there is still much uncertainty in the industry, as evidenced by the 888 announcement this week they will be following PartyGaming out of the Turkish market.
“Given this start to 2007, the release of new products, our Bingo acquisition and our clear business strategy, we are confident of delivering future growth in 2007,” said chief executive Gigi Levy.