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Gambling: Centrebet Good Earnings

The Australian business media are reporting that online gambling group Centrebet is expecting its profits to be at the upper end of previous guidance reports, thanks to growth in the Australian Internet betting market, which has recently seen advertising restrictions removed after court actions.
 
The online betting group has also predicted strong profit growth in 2009/10 as it looks to increasing market share in Australia.
 
Centrebet spokesmen said the group's net profit after tax for the year ended June 30, 2009 would be at the upper end of its guidance of $10 million to $11 million on an adjusted basis, and $7.5 million to $8.5 million on an actual basis.
 
Based upon unaudited accounts, total revenue for the 2009 financial year rose 6 percent to $66.2 million, with Australian online revenue - representing 50 percent of total revenue - up 23 percent to $32.9 million.
 
European revenue (excluding poker) - representing 39 percent of total revenue - was flat at $26.1 million. European poker revenue - which represented six percent of total revenue - was down by 17 percent, at $3.8 million.
 
Centrebet managing director Con Kafataris said the company had responded well to recent deregulation in the betting industry.
 
"While deregulation of the industry has presented some short-term cost challenges, it has created an attractive outlook for Centrebet to continue to grow market share," he said in a statement.
 
"We expect the overall industry to show strong growth over the medium term, and Centrebet is well positioned to maximise our share of that growth through customer-focused product offerings, targeted marketing investment and disciplined risk and cost management."
 
Centrebet said its 2009/10 profit would be boosted by the full year effect of a cost rationalisation program that was now complete.
 
The company would also benefit from the launch in May of fixed odds management contracts with the West Australian, ACT and Tasmanian TABs.
 
Under the contracts, Centrebet will manage upwards of $200 million a year in fixed odds betting turnover on behalf of the TABs.
 
Centrebet said it would increase its spending on marketing in Australia and core European markets and reduce spending in non-core European markets.
 
Total spending on marketing in 2010 was expected to be less than in 2009.
 
In 2007/08, Centrebet increased its bottom-line net profit by 16.8 percent to $13.01 million.
 
The trading report pushed up share prices by 3.5 cents.



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