32Red warns of bad news

Popular online gambling group cautions that full year results are likely to be disappointing

Investors in the Gibraltar-based online gambling group 32Red are in for a disappointment when the full year results are released, according to a profit warning from the group contained in a trading update this week.

The statement blames the impact of the global economic meltdown earlier this (2009) year on its high roller action, together with an inability to build player yields sufficiently to beat the trend. The company also flagged an extraordinarily high proportion of wins by the players in October 2009.

A 32Red spokesman warned that full year profit numbers were likely to be “...significantly below market expectations.”

Ironically, the poor full year results come in a quarter where the group posted its highest yet revenues, which rose by 11 percent - mainly at the casino operations - on the same quarter in 2008. During the quarter the number of active players rose 16 percent, but this was not enough to tip the balance into positive territory.

Taking a positive stance, the statement remained optimistic, saying that there was still plenty of player action and that Management had no plans to reduce its marketing initiatives merely for immediate gain.

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