The Board of Webis Holdings plc, the global on-line gaming group, is pleased toprovide a trading update in relation to the Company’s unaudited results for itsfinancial year ended 25 May 2008.
The Company has continued to make progress and both our sportsbook,betinternet.com and our pari-mutuel operation, European Wagering Services (or’EWS’), have seen an improved trading performance for the year as a whole.
betinternet.com Sportsbook Portal
The betinternet.com sportsbook portal has seen a positive effect on revenuesfrom the greater spend on marketing the website within Europe. The Company hassponsored 14 horse races at Newmarket and Ascot racecourses during April and May2008, three of which were broadcast live on terrestrial TV in the UK. This initial promotionalactivity has given the brand great exposure to a clientele that would generallybe unfamiliar with our offering. The Board is committed to continuing withsimilar types of sponsorship throughout the new financial year, as it believes that this type ofmarketing activity successfully promotes the brand to its target audience.Notwithstanding this, the Company remains fully committed to serving new andexisting customers in the Far East by ongoing enhancement of its football product offering.
The marketing spend has also had a positive impact on the revenues achieved byour two casinos and fixed-odds games. These products accounted for 66% of theoverall sportsbook’s revenue for the full year and continue to show stronggrowth. The Board anticipates adding further similar products to the portal during the forthcomingyear.
Technology continues to play a greater role within our sportsbook, both for thecreation of new content and as a risk management tool. As a direct result, wehave again been able to reduce our sportsbook operating costs and these savingshave been re-invested in marketing. We have also committed to upgrading our sportsbookhardware environment and the relocation of this to a third-party, purpose-built,hosting facility on the Isle of Man. This project is planned for completion inJuly and will further enhance the security and resilience of our sportsbook portal.
The current European football championships are attracting a large amount ofinterest for the sportsbook and the Board anticipates a positive impact onrevenues from this event for the forthcoming year.
European Wagering Services
EWS has shown the anticipated improvement in the second half of the financialyear, following the resolution in November 2007 of our previously notifiedtemporary banking issue. For the full year, turnover increased however our netmargin reduced as the impact of the banking issue in the first half had a greater effect on thehigher margin ‘leisure players’ rather than the lower margin ‘high rollers’. Inaddition, at a limited number of racetracks, we have experienced an increase inthe ‘Host Track Fee’ (a percentage of turnover that we pay to each racetrack) and this has alsohad a small impact on our net margin.
The Board is pleased to report that the re-design of the link2bet.com website isnow underway, following our concentration on a contract to provide a white-labelwebsite, which was successfully launched in May 2008 at www.totebet.com. Weanticipate the updated link2bet.com website will be launched in Quarter One of the newfinancial year and once this is fully operational we would expect to increaseour marketing spend accordingly.
Our other current focus is to increase the amount of quality content that ourcustomers can wager on and we remain in negotiations with a view to achievingthis. This process takes considerable time and requires a commitment to ongoingrelationship-building at a high level within the pari-mutuel industry. EdComins, the chief operating officer of EWS, has established himself as aneffective presence within the industry and this will help facilitate ournegotiations with potential partners.
Managing Director, Garry Knowles, said "it is very encouraging that the Companycontinues to make good progress and has managed a path through the challengesfacing our industry. Our previous focus on ensuring that the Company has strongfoundations has meant that we have been able to concentrate our energies successfully ongrowing both EWS and betinternet.com during the second half of the financialyear. I anticipate that this growth will continue into the new financial year aswe allocate more funding to marketing the increased offering of both the pari-mutuel andsportsbook operations."