Mybet Holding SE : Sports betting provider mybet's Q3 marked by strong growth and weak margins

mybet Holding SE  / Key word(s): Quarter Results



08.11.2012 08:10



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Sports betting provider mybet's Q3 marked by strong growth and weak margins



- Nine-month revenues rise by 14.3 percent to EUR 49.3 million

- Weak bookmaking margins burden Q3 earnings

- Adjustment of EBIT forecast to EUR 8.0 million to EUR 9.0 million

- Strong start to Q4



mybet Holding SE (formerly JAXX SE; Deutsche Börse, Prime Standard, ISIN

DE000A0JRU67) today publishes its report on the first nine months of 2012.

Following the very successful first two quarters, which brought record

revenues and new-customer totals on the back of the UEFA European

Championship, in many respects the third quarter maintained the positive

performance.



Business performance



Betting stakes in September were almost up at the June level, when the

European Championship took place. However the long summer break in European

football leagues after the European Championship and weak margins in

September, which impacted on the entire sports betting industry, meant

revenues were relatively low. Despite this seasonal effect, mybet was able

to compensate for the loss of income from the lottery operations, which

were disposed of in May, and it generated consolidated revenue of EUR 15.0

million. This compares with a revenue figure of EUR 14.7 million for the

third quarter of the previous year, when lottery agency business brought in

around one-third of revenue.



Earnings before interest and taxes (EBIT) for the third quarter came to EUR

-1.0 million, almost entirely due to September's weak margins. EBIT for the

third quarter of the previous year was EUR 1.0 million.



Cumulatively over the first nine months of the year, revenue was up a

healthy 14.3 percent at EUR 49.3 million. Nine-month EBIT was EUR 6.8

million. Taking into account the divestment proceeds of EUR 7.7 million

from the sale of lottery operations, the operating result achieved by the

group was thus EUR -1.0 million. In the previous year the nine-month result

was EUR 0.9 million, with lottery operations contributing EUR 2.3 million.



In terms of customer growth, mybet's platforms have seamlessly maintained

the successful performance of recent quarters. The total number of

registered users crossed the 1 million threshold at the end of the third

quarter. As an average for the third quarter, almost 20,000 customers per

month placed a bet online. This compares with only around 16,000 in the

same period of 2011.



The betting stakes placed on mybet's sports betting products in the third

quarter rose by 20 percent to EUR 38.6 million (previous year EUR 32.3

million). The weaker margins meant the hold increased by only 8 percent to

EUR 5.8 million. A comparison of the nine-month periods revealed a 40

percent rise in betting stakes to EUR 136.3 million, and a 44 percent

increase in the hold to EUR 22.3 million (previous year EUR 15.6 million)

thanks to the still-healthy margins achieved in the first half.



In a turnaround from original plans, mybet succeeded in passing on to the

end customer the entire German gaming tax that has added 5 percent to

betting stakes since July 1, 2012. This has been hugely beneficial to

mybet's financial performance.



Cash and cash equivalents at the balance sheet date of September 30, 2012

came to around EUR 14.0 million (December 31, 2011: EUR 7.2 million). This

figure does not yet include the full final payment from the disposal of

lottery operations, which was earmarked for the end of Q3 but not actually

posted until the start of the fourth quarter.



Outlook



The fourth quarter of 2012 has started very strongly. For just the first

week of October, the hold for mybet products was higher than the figure for

the whole of September. Overall, October brought a record hold, which

should have largely compensated for the September result. With a large

number of football events, spanning the Bundesliga, the Europa and

Champions Leagues and World Cup qualifiers, the fourth quarter holds the

promise of record levels of betting stakes and good margins. The market

launch of the mybet app for smartphones (iPhone, android) that has been

piloted since the start of the Bundesliga season is also scheduled for the

fourth quarter.



The cost basis will be further optimised in the fourth quarter. Growing

efficiency is expected, in particular in connection with the marketing

budget and commissions for venture partners. The costs of the holding

company will be reduced yet again as a result of staffing changes and

rental savings.



In the shop sphere, mybet will continue the course of consolidation of

recent months and place the spotlight on the revenue volume, size and

location of its betting shops. Furthermore, mybet is planning to open its

first own flagship stores in the fourth quarter. mybet aims to be running

between 50 and 60 of its own shops in the next two years.



In Schleswig-Holstein, the granting of the poker and casino licence is

still awaited. Whether and when the Ministry of the Interior will grant

this remains unclear.



On the basis of the nine-month figures and progress to date in the fourth

quarter, the Management Board continues to expect revenue of between EUR 65

and 70 million for 2012 as a whole, along with a positive EBIT. However the

forecast range has been revised downward by EUR 1.0  million to EUR 8.0 to

9.0 million in light of the Q3 result. Of this total, EUR 7.7 million will

come from the divestment of the Lotteries segment.



Key figures for 9 months / 3rd quarter:

9M 2012  9M 2011  +/-    Q3 2012  Q3 2011  +/-  

                         EUR '000 EUR '000 %      EUR '000 EUR '000 %    

Gross revenue             176,873  134,930  +31.1   52,362   45,695  +14.6

Revenue                    49,264   43,108  +14.3   14,966   14,686   +1.9

          Sports Betting   23,223   16,521  +40.6    6,101    5,975   +2.1

          Casino & Poker   15,449   12,554  +23.1    5,532    3,489  +58.6

               Lotteries    5,006   10,329  -51.5    1,015    4,007  -74.7

           Horse Betting    4,463    3,002  +48.7    1,534    1,051  +46.0

Net gaming revenue (NGR)   48,567   42,633  +13.9   14,634   14,508   +0.9

Other operating income*     8,772      926 +847.3      276      104 +165.4

EBITDA                      9,695    4,286 +126.2     -300    2,254    n/a

EBIT                        6,766      898 +653.5     -975    1,040    n/a

Consolidated earnings       5,227      512 +920.9   -1,303      683    n/a

Earnings per share (EUR)     0.22     0.01    n/a    -0.06     0.03    n/a



30/09/12 31/12/11                               

Cash holdings              14,026    7,187                               

Shareholders' equity       27,614   22,673                               

Equity ratio               64.2 %   60.7 %                               

*The other operating income for 9M 2012 includes the divestment proceeds of

EUR 7.7 million from the disposal of German-language lottery operations in

the second quarter of 2012



The Nine-month' report will be made available for downloading in

the course of today on the websites www.deutsche-boerse.com and

www.mybet-se.com.



Contact:

mybet Holding SE

Investor Relations & Corporate Communications

Stefan Zenker

Tel. +49 (40) 85 37 88 47

Fax +49 (40) 85 37 88 30

Mail stefan.zenker@mybet.com



08.11.2012 DGAP's Distribution Services include Regulatory Announcements,

Financial/Corporate News and Press Releases.

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