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DECLINING SALES CONTINUED IN 2010 FOR ENTRACTION

Posted 2/11/11 : Weak Euro exchange rate and lower revenue per player
 
Internet gambling software developer Entraction Holding AB reported weak full year 2010 results this week, with net sales of SEK 340.8 million showing a decline of 22 percent over 2009.
 
Despite initiating an action programme in August 2010 to reduce operating costs, the company reports that the continued decline in sales compared to 2009 is largely due to the Euro exchange rate and the closure of Cardroom 2.
 
-  Net sales amounted to SEK 340.8 million (SEK 435.4 million), a decline of 21.7%.
 
-  EBITDA was SEK 34.0 million (2009:64.2 million), a decline of 47.0%.
 
-  Operating profit amounted to SEK 20.2 million (SEK 52.0 million). The weak euro had a negative impact of SEK –10.4 million.
 
On a more positive note, the number of registered players at the end of the period was 3.9 million (2009: 1.96 million) an increase of 100 percent which is primarily attributable to the migration of Victor Chandler’s players to the Entraction poker network.
 
Entraction has signed new agreements with Betsson, Victor Chandler and Sportingbet and the company says its poker network is now the world's third largest open poker network.
 
 
Peter Åström, CEO Entraction commented:
 
"Sales were lower than to the same period the previous year. This is partly due to a lower revenue per player, but is also an effect of the weak Euro exchange rate. However, I am convinced that Entraction will be able to show future growth as more established operators decide to enter into agreements with us.
 
"The measures we have taken to increase sales and reduce costs have already yielded positive results. During December, Victor Chandler, one of the market's largest gaming operators, moved its players to Entraction's poker network. This, coupled with the growth experienced by several of Entraction's existing customers during the period, has boosted activity in our poker network.
 
"We also signed an agreement to supply poker software to a separate gaming network in China. Entraction is now well-positioned for profitable growth.
 
"So, in aggregate, Entraction stands strong in the fast-changing gaming market. We have a good position as a growing independent gaming network, and our new customers are testimony to the fact that we supply high quality products and services to our customers."



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