LOWER margins in sports betting pushed second quarter revenues from Bwin.Party below expectations, the online gambling company said yesterday.
Bwin has also been hit by the introduction last year of a turnover tax on sports betting in Germany, its largest market, and competition in the bingo sector in Britain and Italy.
Like other online gambling companies, Bwin is focusing on fewer markets where it can make better returns and it is also preparing to expand in the US as markets open up there.
“While the revenue performance was down on last year, we remain on course to deliver the targeted €70m (£60m) of cost savings in 2013 with more to follow in 2014,” chief executive Norbert Teufelberger said in a statement.
The company said its licence applications in New Jersey were at an advanced stage and it was preparing for markets to open up there in November.
“Sporting margins are an inherently unpredictable element of a bookmaking business,” said Numis analyst Ivor Jones. “Today’s downgrade is disappointing but we do not believe there is an underlying problem with Bwin.Party’s sports betting business.”
Shares in the firm closed down 6.4 per cent yesterday at 122.2p.
City A.M. Reporter