Sportingbet bullish for 2010 in spite of February weakness

ONLINE gaming firm Sportingbet said February margins had been hit by football results going against it but was confident for the year after posting a seven per cent rise in second quarter profit.

The British firm, which gets almost 90 per cent of its bets from Europe, said yesterday its second quarter to 31 January came in as forecast despite the economic downturn.

It reported adjusted operating profit of £11.2m and saw net gaming revenue rise 22.3 per cent to £52.6m.

But margins dropped to 8.2 per cent in February from the group’s target of about 10 per cent after a run of football results went against the firm despite more bets being placed.

Chief executive Andrew McIver said: “It was really down to more favourites winning in European football.” He added that 65 per cent of all the bets taken in Europe are on football, with the percentage increasing every year.

On the World Cup McIver urged caution over any profits surge as a result of the tournament.

“It will help the turnover but I’ll be surprised if the profit gets a particular boost,” he said. “Bookmakers don’t tend to make a lot of money on things like the World Cup because there’s not many teams and the predictable ones tend to be there at the end.”

McIver also said that consolidation was not a priority for Sportingbet unless the right deal came along.

Analysts expect a wave of mergers and acquisitions activity among online gaming groups this year amid talk of a possible merger between PartyGaming and Austria’s Bwin.