On Thursday, Party Gaming released its financial results for the year 2010 and reported a 15% increase in revenue over 2009’s numbers. The company, which operates PartyPoker as well as online casino games, sports betting, and bingo, earned €357.3 million ($498 million) in 2010, compared to €310.1 million ($432 million) the previous year.
Party Gaming reported net income of €38.9 million ($54 million), compared with an €18.5 million loss a year earlier. However, PartyPoker’s revenue continued to decline in the midst of strong competition from U.S.-facing operators like PokerStars and Full Tilt Poker. Revenues from PartyPoker fell from €136.8 million ($190.5 million) to €124.8 million ($173.8 million), with Party Gaming CEO Jim Ryan blaming the 9% slide on the company’s absence from the U.S. market since the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006.
As of Friday morning, PartyPoker was the third-ranked online poker site in the world in terms of cash game traffic according to PokerScout.com. The online poker tracking site reported a seven-day average of 4,400 real money ring game players at PartyPoker with a 24-hour peak of 8,216.
However, those numbers paled in comparison to the industry leaders. PokerScout reported a seven-day average of 30,800 cash game players at PokerStars and a 17,200 at Full Tilt Poker, which has seen a boost in traffic totals since it introduced Rush Poker in 2010. Both PokerStars and Full Tilt Poker offer real money games to players in the U.S.
Party Gaming hopes to even the playing field in the near future. The company has strategically positioned itself to move into the U.S. market should online gambling be legalized and regulated. In 2008, Party Gaming inked a non-prosecution agreement with the U.S. Department of Justice in order to avoid a criminal plea and has waited for its chance to re-enter the market ever since.
Said Ryan, “In the U.S., we believe there is growing political and commercial will to regulate online gaming and that we are well-positioned to exploit our strong franchise in that market should regulations allow.”
The company’s other segments picked up its poor poker revenue in 2010. PartyBingo more than doubled its revenue from €22.8 million ($31.8 million) in 2009 to €51.4 million ($71.7 million) in 2010. The site’s sports wagering business also saw a large increase, mainly due to World Cup wagers, from €13.2 million ($18.4 million) to €20.8 million ($29 million). PartyCasino’s revenue rose to €151.4 million ($211 million) in 2010 from €136.3 million ($190 million) a year earlier.
Party Gaming also reported promising numbers for the start of 2011. In the two-month period ending February 28th, average gross daily revenue was €1,432,000 million, up from €1,425,400 in the fourth quarter of 2010. The company also noted that new poker player sign-ups increased to an average of 1,905 per day, up from 1,853 in quarter four of 2010.
In addition, Party Gaming’s merger with bwin should be finalized at the end of this month. Shareholders approved the merger in January and agreed to name the company bwin.party Digital Entertainment plc. The union between the two gambling giants will form the largest online gaming business in the world.
Said Ryan, “As our merger with bwin is set to complete on March 31st, 2011, we are finalizing our plans to integrate both businesses as quickly as possible and remain confident about delivering the cost and revenue synergies we have already identified in line with the previously announced timetable, with the full €55 million per annum being delivered by 2013. We plan to provide a further update on our progress at the time of the half year results in August 2011.”
