Bloomberg News

888 Holdings Up Most in Two Months on Record Quarterly Sales

November 01, 2011

(Updates with closing share price)

Nov. 1 (Bloomberg) -- 888 Holdings Plc, a U.K.-listed online gambling company that supplies services to Caesars Entertainment Corp., rose the most in two months after saying third-quarter revenue increased to a record quarterly high.

888 climbed 6.8 percent to close at 35.25 pence in London trading, the biggest gain since Aug. 30. This gives the Gibraltar-based company a market value of 122.3 million pounds ($195 million).

“We’re concentrating on growing our volume business, not necessarily high-spend, particularly in poker to get our liquidity up,” Deputy Chairman Brian Mattingley said in a phone interview.

Third-quarter revenue rose 42 percent from a year earlier to $86 million, the company said in a statement today. Trading remained strong in the fourth quarter and will push full-year earnings before interest, taxes, depreciation and amortization beyond analysts’ forecasts, 888 said.

“In the past we spent a lot of development time into areas that are not our core products,” Mattingley said, “So now we concentrate on casino, poker, bingo and to a lesser extent, sport.”

The company is focusing on offerings to consumers instead of business-to-business products and services after a strategic review in the second quarter, Mattingley said. It is also using an automated marketing tool to target promotions at customers based on their preferences and usage habits.

Direct-to-consumer business, along with the marketing tool “has significantly changed the accent of our marketing approach and is now paying dividends, as being seen by the quarter-on- quarter growth we’re witnessing,” Mattingley said.

Nevada License

The company, which said in July it may apply for an online poker license in Nevada, has put the plan on hold until the U.S. market is “a bit more positive,” he said.

“We’re actively in dialog with more than one operator out there” in case the market opens up,” he said, “It’s a very difficult market to read at the time.”

The company plans to focus on growth in new markets that become regulated, including its recent entries into Italy and Spain, and has yet to replace Gigi Levy, who stepped down as chief executive officer in April, Mattingley said.

--Editors: James Kraus, Chris Peterson

To contact the reporter on this story: Namitha Jagadeesh at njagadeesh@bloomberg.net

To contact the editor responsible for this story: Colin Keatinge at ckeatinge@bloomberg.net


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