Party Gaming Posts Loss, Will Continue Expansion

Party Gaming, parent company of online poker site Party Poker, released their results for the first half of 2009 today. The company reported a loss of $66.9 million, or 16.5 cents per share, a loss largely generated by the company’s $100 million+ settlement with the US Government earlier in the year.

Party CEO Jim Ryan had this to say about the loss: “As expected this has been a challenging first half given year-on-year currency movements, competitive pressures and the impact of the macroeconomic downturn. While revenues have fallen year-on-year, we have seen a corresponding benefit of currency movements on our cost base, and this along with the benefits of our cost reduction programme put in place last year, has meant that we have been able to mitigate most of the impact on Clean EBITDA.”

The news comes on the heels of Party’s announcement that they’re acquiring most of the World Poker Tour, a deal worth over $11 million dollars. According to Ryan, the company plans to continue expansion: “With many of our competitors still to resolve their legacy issues with the US authorities, we have sought to take advantage of the window of opportunity that now exists to consolidate the market at sensible prices.”

Party reported that revenue from casino operations provided much of the good news for 2009 to-date, with 2009 revenue from those operations essentially staying the same as the comparable period in 2008. Poker saw a significant drop off from 2008 to 2009, with net revenue dropping from 153.9 million to 102.6 million. Ryan had this to say about Party’s poker prospects: “While poker continues to face competitive challenges from the US-facing sites, the launch of our Italian poker network and a much improved loyalty programme and retention process has seen poker numbers stabilising in the second quarter with unique active players 5% ahead of the first quarter, despite the second quarter being a seasonally quiet period.”

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