PartyGaming, one of the online gambling giants currently in talks of purchasing Bwin Entertainment AG, recently announced that it had suffered a setback in revenue in terms of its poker sector. Sadly, while PartyGaming’s casino and bingo game returns are on the rise, the poker facet of the gambling giant company is not doing so well. According to a recent revenue report from PartyGaming which recorded the company’s 12-month profits, Party Poker has dropped by 8% in revenue.
When the earnings from Party Poker dwindled by 8 percent, this left its revenue at 125.9 million euros. Nevertheless, PartyGaming’s Chief Executive Office, Jim Ryan, stated that the loss will be compensated by the year end and that lot rewards are being increased by 25 percent by the company, to retain the players on the site and motivate them. The revenue drop may have been caused by a loss of player traffic and even more importantly a lack of player spending at the site.
PartyGaming which runs Party Poker, proclaimed a net income of 38.9 million euros ($54 million) or 9 cents each share, making a loss of 18.5 million euros or a loss of 4.5 cents each share in the previous year.
PartyGaming’s Chief Executive Office, Jim Ryan, admitted that the PartyGaming is positive that it will make a savings of 55 million Euros every year by the year 2013, after the deal with Bwin is completed.
PartyGaming will be known as Bwin.party digital entertainment after the transaction is completed on March 31. PartyGaming is acquiring Bwin to simplify its entrance into the European segment, since virtual gambling is being made lawfully permissible. The company is now focusing a lot more in including casino and bingo to their vertical considering poker is not doing so well owing to the fight from other entities that allow U.S bets even now.
Ryan also added that they are expecting Denmark to permit online gambling by this year with Greece, Netherlands, Spain and Germany following the suit shortly.
According to Financial Director Martin Weigold, PartyGaming shelled out 25 million euros after having delved into other European regions like France and Italy. There has also been a 7 percent dip in the shares, leaving the PartyGaming’s market worth at 781.3 million pounds ($1.3 billion). However, despite the drop in poker revenue and falling shares, the company’s worth increased by 9.1 percent in London.
Hopefully, with the expansion into Europe, the upcoming merger and Denmark’s legalization of online gambling, the online poker revenue at Party Poker will begin to increase and show profits or at least break even.