Revenues at PartyGaming, the operator of the world’s biggest online poker site, soared by 65 per cent during the fourth quarter, thanks to the success of its new blackjack offering and its ability to cross-sell to eager punters.
Shares in PartyGaming also rose confidently in early morning deals after the group said it had signed up a record number of poker players – at 229,277 over the period.
Richard Segal, PartyGaming’s chief executive, said the near two-thirds revenue increase to $320.3 million was helped by an 8 per cent increase in yield per player to $17.9 compared with the previous quarter.
Mr Segal also noted that 44 per cent of its active online gambles at its PartyPoker.com website also played blackjack, which it began to offer at the beginning of last October.
“The success of blackjack has tranformed our casino business and proved very popular with a large number of our poker players,” Mr Segal said, as PartyGaming updated the City with its key performance indicators for the fourth quarter.
Dresdner Kleinwort Wassertein, PartyGaming’s house broker that was responsible for last year’s flotation of the group, maintained its buy recommendation and upped the share price target 10p to 175p.
Having initially risen by almost 3 per cent to just under 150p, PartyGaming shares were up 1.75p at 147.25p after the first hour of dealings in London.
The City had been expecting strong numbers from PartyGaming, after it brushed aside concerns initially expressed last summer that its long-term revenue growth would slow. However today’s revenues beat analysts’ concensus forecasts that PartyGaming would generate revenues of about $295 million.
“We returned a strong performance from our poker business while our casino business’ performance was nothing short of outstanding. Trading has remained strong since the start of the year,” Mr Segal added later.
PartyGaming’s revenue growth has been substantially shored up since October, when it moved to ring-fence its own players from users of so-called “skin” websites such as Empire Online – with which it is now fighting a substantial legal battle as a result.
Empire Online, which as a skin site made revenues from directing traffic towards PartyGaming’s websites, is claiming that the ring-fencing move represented a breach of contract.
PartyGaming said its next “major milestone” would the launch of its fully integrated betting platform during the first half of this year, followed by new games and a multi-lingual and multi-currency offering.