888’s revenues from Spain are larger than they were pre-regulation due to the performance of its dot.es poker room, the operator revealed this morning.
“We have seen a growth in revenue compared to that of the pre-regulated situation, even after the deduction of Spanish tax,” CEO Brian Mattingley said in his company’s Q3 earnings call this morning. The 888 boss attributed this to “a greater response to our marketing campaigns than we had originally anticipated.”
The overall performance had been achieved despite the absence of online slots in Spain, where only casino table games were included in the first wave of regulation in June, putting online casino returns “significantly behind our dot.com”, said Mattingley.
The 888 CEO said the performance of 888Poker.es since the regulated opened for business in early June put them on track to break even in the territory by the end of this year. “The growth in our NGR is not matched by the EBITDA, and naturally we are investing many marketing dollars in Spain, significantly more as a percentage of our revenue than we would in a mature market. But what I can say is that current indications are that by the end of our financial year, we will be in a break-even situation,” said Mattingley in response to a question from analyst Vaughan Lewis of Morgan Stanley.
“Incredible success in poker” in Spain had also continued to drive the group forward in October, the 888 chief added. “This has been a significant factor in the fourth quarter being 10% compared to that of the corresponding period last year, a period that was itself a very strong one.”
A 21% rise in poker revenues to US$22m – still up 11% year-on-year once the effect of several B2B brands becoming B2C brands had been removed – drove a 7% rise in group revenues to $92m in the three months to the end of September. Mattingley also credited “the results of the ongoing success of our targeted analytic driven marketing campaigns, which are resonating well with our customer base.”
The strong poker performance across the group’s dot.com and regulated markets offset a flat performance in the company’s core casino product, for which revenues were up just 2% to $38m, impacted by regulation in Italy – where slots are also absent – as well as Spain.
B2C bingo revenues were also flat at $13m, as were those from its B2B Dragonfish business at $12m. Revenue from 888’s emerging offering, consisting of sports betting and social gaming, was however up 27% to $7m, driven by [g]rowth in our social networking…in the region of 45% year-on-year”, according to COO Itai Freiberger.