PartyGaming, the parent company of Party Poker, released its Key Performance Indicators (KPIs) for the fourth quarter of 2008 last week, showing positive player growth, but mostly negative financial results.
For the quarter, the company as a whole brought in $100.4 million in revenue, an 18 percent decrease from the same quarter in 2007, when PartyGaming made $122.4 million. This was also a 15 percent drop from the third quarter of 2008. Over the entire course of 2008, however, revenues did increase modestly, three percent, from 2007, growing from $457.8 million to $472.9 million.
PartyGaming saw 168,000 new players signup during the quarter, a 22 percent increase from the third quarter, and a 12 percent increase from the 150,400 new players who signed up in the fourth quarter of 2007. Unique active player numbers, while still up from third quarter, were not as positive as new signups, showing only an 8 percent increase to 584,300. This was down marginally from the same quarter in the previous year. And, despite the increase in new signups and unique players from the third to fourth quarters of 2008, the yield per active player day went down 21 percent to $15.80.
PartyGaming attributes much of the revenue drop to the strengthening of the U.S. Dollar against the Euro, Canadian Dollar, and Pound Sterling, as well as increased spending on promotions related to the relaunch of Party Poker’s new software client. PartyGaming estimated the exchange rate impact at $15 million for the quarter. The U.S. Dollar was up 9 percent on average versus the Euro compared to the same quarter in 2007 and up 12 percent compared to the previous quarter. The Dollar was up 23 percent against Sterling versus 2007 and up 17 percent versus the third quarter.
Interestingly, the company also continues to complain about other poker rooms continuing to accept U.S. customers. No names were mentioned, but PokerStars and Full Tilt Poker are the obvious enemies number one and two, as they are the not only the two most heavily trafficked poker rooms on the internet, but also the only two rooms that still accept U.S. players that rank ahead of Party Poker. PartyGaming CEO Jim Ryan said that his company was competing on an “unlevel playing field in poker.”  The KPI statement issued by the company claimed that sites such as PokerStars and Full Tilt Poker are “distorting the market” by continuing to service American poker players.
Ryan also addressed his company’s talks with the United States Department of Justice, saying that they “…continue to progress in line with our expectations and the execution of our strategic plan together with tight control over our cost base means we look forward to making further progress to consolidate our position as the world’s leading listed online gaming company.”
While Party Poker is the best known brand in the PartyGaming stable, the company also operates Party Gammon (backgammon), Party Bets (sports betting), Party Markets (financial markets betting), Party Bingo, and Party Casino.
In addition to the KPI release, PartyGaming announced a couple business deals. The first is with CIRSA Gaming Corporation S.A., leading European gaming and leisure company that operates 57 bingo clubs and 139 arcades in Spain and has a presence in Latin America. The two companies will develop online gaming opportunities together.
The second deal is with one of the world’s top video game companies, Capcom Entertainment, Inc. The three year agreement will see PartyGaming launch an exclusive online slot game in the second quarter of 2009 using the Frank Sinatra brand. Capcom has developed some of the most successful franchises in video game history, including Mega Man, Street Fighter, and Resident Evil.
PartyGaming’s stock, which trades on the London Stock Exchange, rose 6.67 percent the day the KPI information was released.

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