888 told Reuters that its online gaming firm is looking rather optimistic. In fact, they’re announcing 30 percent revenue growth this year. The financial result was also boosted by a ‘better-than-expected start’ from its new sports betting and bingo sites, which are offered online, free and for real money.
During a telephone interview with a media source, the Chief Executive, Gigi Levy, said: "Current run rate indicates 20 percent (overall revenue growth), and we are bullish on pushing this. Do I think 30 percent is too much? No, I don't think 30 is too much.” Levy added that the firm's new bingo and sports betting web sites were also seeing strong growth, which means even more bucks for their business.
He also stated: "Bingo is doing dramatically above anything we expected. The run rate is currently where we expected to get to by the end of the year, it's that good. Sports was only launched a few weeks ago, and already last week we had hundreds of new sign-ups every day."
Online poker and casino firms have been gradually rebuilding their businesses after the U.S introduced of the Unlawful Internet Gambling Enforcement Act (UIGEA) in October 2006, and closed off the world's biggest market in 2006, with a ban on gambling-related banking transactions.
After the state legislature failed to adopt a new budget by the constitutional deadline, the government shutdown has resulted in the closure of all "non-essential" government offices, among which the state Casino Control Commission itself. Nevertheless, the move was a major financial blow and wiped billions of dollars off the value of online gaming stocks virtually overnight and led to a number of founders and online executives being prosecuted for taking illegal bets.
However, 888 and its rivals PartyGaming and Sportingbet are now locked in talks with U.S. lawmakers. Levy commented: "I think it's getting clearer and clearer for everyone that this may take time, but this is heading one way, and that is towards a resolution. 888 and PartyGaming have said they expect a deal, whatever it is, to be reached during the second half of the year.”
Nevertheless, analysts are not looking happy on that, as they expect the firms to be hit with hefty fines. In change, they predict a sort of consolidation strategy, giving the land-based casino operators and bookmakers’ tendency to buy up fast-growing online firms.
In response to this, Levy said it was unlikely 888 would ‘resurrect’ previous failed deals with PartyGaming or UK bookmaker Ladbrokes. Overall, The Pacific Poker and Foxy bingo operator said that 2008 had started well as it posted 2007 profits of $46 million. And the analysts were dazzled! As for the current analyst forecasts, they expect the firm to report a 2008 pretax profit of no less than 60 million bucks! Keep up the good work!
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