AIM-listed Sportingbet.com, the online bookmaker, said turnover generated from the US has recovered to levels above that seen immediately prior to 11 September, while reporting healthy first-half results to 30 September.
The loss of turnover as a result of the cancellation of sporting events in the three weeks immediately after the terrorist attacks amounted to approximately £13m, leading to a loss of margin of £700,000. Sportingbet spent a one-off £500,000 on marketing to persuade customers to start betting again when sporting events restarted in the US.
Sportingbet said the third quarter is the busiest trading period of the year and financial performance to date has been “strong”.
The company said turnover for the period amounted to £293m, up from £114m last year. Net loss narrowed to £635,000 against £1.6m for the first-half of 2000 and the company made an operating profit, before non-trading and exceptional costs, of £400,000 compared with an operating loss of £3.5m reported last year.
Sportingbet said it achieved positive cash flow during the period, with inflowing funds totalling £300,000 against an outflow of £3.4m last year. Gross margin was £15m, or 5.1% of turnover, and the company retained £16m in cash as at the end of September.
The company, through its acquisition of Antigua-based Sportsbook, has seen its customer numbers swell to 432,000, from 90,000 last year, with 31,000 new users attributed to organic growth. Sportingbet said its customers have marginally increased their average stake as well as placing more bets over the past six months, concluding that there had been “no sign of any recessionary effect on its trading activities in any of its markets”.
It continues to seek marketing partners to pursue organic growth in countries where it is not yet sufficiently established, such as Japan, where it reported “no significant progress” despite a relationship with a company called J-Craft. Sportingbet also said it is in discussions with a number of parties interested in purchasing its white-label services, where it provides the back-end technology to a marketing partners’ front-end branded website, allowing well-known brands to “enter the sports betting market with ease”.
Sportingbet said the integration of Sportsbook has proceeded better than expected, with annual cost savings of £3m already realised after the two company’s banking infrastructures were merged.