By Peter Harrisson Source:http://today.reuters.co.uk/news/articlebusiness.aspx?type=businessNews&story =2006-12-14T114238Z_01_WLA6519_RTRUKOC_0_UK-PARTYGAMING-TRADING.xml
LONDON (Reuters) – PartyGaming said on Thursday poker revenues were recovering after being hit by the United States ban on Internet gambling and it was in talks to buy smaller companies that could not cope with the ban.
Daily online poker revenues have recovered to $721,000 (366,000 pounds) after falling to a daily low of around $637,000 after the ban in October.
“Bolt-on deals are very interesting right now,” Mitch Garber told reporters. “We’ve had a chance to see how some of the smaller guys are dealing with — and in some cases cannot deal with — the lack of liquidity, after what happened in the U.S.”
Garber declined to comment on the progress of discussions to buy either smaller rival 888 Holdings (888.com) or part of Austria’s bwin.com, which he said were both stable businesses after the U.S. ban.
“There are a number of organisations out there that have a lot of skill and expertise, but after two months of not having U.S. business have become quite attractive, so those discussions are ongoing,” he added. “We’re looking to add expertise and accretion to our existing business.”
PartyGaming said it had been hit by the defection of some of its bigger gamblers outside the United States to privately owned poker Web sites that were ignoring the ban and allowing players to compete with U.S. rivals.
Analysts at Deutsche Bank said a drop in overall daily revenue to $921,000 was worse than expected and they cut their forecast of 2007 core profit by 10 percent to $133 million.
But PartyGaming’s volatile shares were up 1.8 percent to 28-3/4 pence by 8:34 a.m. British Time, having swung between a loss of 3.5 percent and a 5-percent rise.
“Overall yield per active player day has been affected by the loss of higher-raking players, but this has been partially mitigated by strong levels of new player sign-ups that have averaged over 1,400 per day,” said PartyGaming.
The group now takes 67 percent of its revenues from Europe, the Middle East and Africa, and 27 percent from Canada and Central and South America.
As a result of the U.S. ban, PartyGaming has cut 945 jobs, or 41 percent of its workforce, mostly in India.
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