Online gaming and software development company Leisure And Gaming (L&G) have just revealed their Q4 results which show a drop in gross profits to €1.8 million in Q4 2009 from €1.9 million in the same period in 2008.
Although the figures appear reasonably steady, casino and sports betting revenues plummeted sharply over the period and the overall company result might have appeared more dramatic if not for excellent poker results, especially in the Italian market.
Casino products were the worst affected in Q4 and declined by 70% from €14.7 million in 2008 to €4.5 million in 2009. The net win was down by a third overall with the poor results being blamed mainly on changes in the Greek market, which saw the closure of the Acropolis casino and a change of casino provider in Greece.
Sports betting saw a sharp decline, too, with revenues dropping 14% from €22.4 million in 2008 to €19.4 million in Q4 2009. The poor UK weather in the last two weeks in December was seen as a major factor impacting the results.
Leisure And Gaming did, however, benefit from a strong performance from its poker business which saw its tournament fees increase by over 5 times from €2.7million in 2008 to €14.7 million in 2009, representing a rake of €2.0 million for the company.
Following the release of the Q4 2009 figures, Chief executive Richard Creed summed things up by saying: “Poker activity in Italy has increased and now contributes 30% of net win, with weekly tournament fees of €1.1m. The adverse weather in late December resulted in a disruption in the matches played which led to a smaller fixture list causing reduced volumes and margins.”
The market didn’t receive the results well and today the Leisure And Gaming (L&G) share price was down 5.60% to 8.38. Part of this was also due to a dividend warning released by a company spokesman, which read:
“In the light of this expenditure and possible further guarantees being required for casino games coupled with continued software development, the Group is unlikely to declare a dividend for 2009.”
