November 13, 2013 / 10:06 AM / in 6 years

UPDATE 1-Greek Internet blackout to hit Bwin.Party profit

By Keith Weir

LONDON, Nov 13 (Reuters) - A block on access to online gambling sites in Greece will hit revenue and profit at Bwin.Party this year, the company said on Wednesday, adding to a decline caused by a strategy of focusing on fewer markets.

Bwin is largely concentrating on better regulated markets and is preparing to expand in the United States as gambling rules are relaxed there.

It said action by the Greek authorities to block Internet access to over 400 gaming sites since August would have a modest net impact on revenue and core profit this year.

Greece, where recently privatised OPAP has a monopoly on sports betting and which has clashed frequently with foreign gambling companies, represents 4 percent of revenues for Bwin.

Bwin said third-quarter revenue fell by 21 percent to 146 million euros ($196 million), reflecting moves to shrink its business in pursuit of better margins.

“As we expected, our underlying third-quarter performance appears to have represented the floor in what has been a transitional year for the group,” said Chief Executive Norbert Teufelberger.

He added that full-year 2013 cost savings were likely to exceed a target of 70 million euros, helping to offset the impact of the Greek dispute at Bwin, formed by the 2011 merger of PartyGaming and Bwin Interactive Entertainment.


Bwin shares fell 2 percent to 121.8 pence following the trading update, which follows a warning in August that revenue could fall by up to 17 percent.

Analysts took some succour from an 18 percent improvement in revenues in the current quarter so far, compared with the previous three months.

“A further downgrade is, of course, discouraging,” said analyst Ivor Jones of Numis.

“However, the suggestion of recovery in the current trading period, before a raft of significant product upgrades due in the next few months, is the first tentative evidence that may be getting back on track,” he added.

Bwin said it was ready to launch online poker and casino games when New Jersey reopens its markets later this month, one of a number of states to relax a federal ban imposed in 2006.

“New Jersey may well be the catalyst for other, larger states to embrace online gaming,” Teufelberger told reporters.

“There is speculation that the momentum for online gaming will continue in California next year,” he said, noting that Bwin had already signed up with a local partner there.

Two company founders have agreed to sell a combined stake of 14.3 percent in Bwin over the next three years under a move that helped to speed the licence process in New Jersey. $1 = 0.7442 euros)

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