888 sales climb as more players bet on casino games

This year’s first quarter “started strongly,’’ according to 888, the owner of the Casino-on-Net and Pacific Poker brands. Last year was the company’s first full year of trading without any business in the U.S., after a 2006 law cut 888 off from its main market by barring foreign betting Web sites.

To keep sales rising, the company is adding sports betting to its array of games in Europe in the current quarter with partner Rank Group Plc and introducing an online casino and wagers on sports in Asia.

“Casino was the star,’’ Numis Securities analyst Richard Carter said of the fourth quarter, which he described as “very strong.’’ Numis, which has a ``buy’’ rating on 888, had estimated revenue of us$ 56 million for the quarter, Carter said in a note.

888 rose 2.5 pence, or 1.9 percent, to 134 pence in London trading. The shares cost 175 pence each in a September 2005 initial public offering and slid 30 percent in the following year as U.S. legislators unexpectedly approved the ban. The stock has lost 5.6 percent this year after gaining 7.2 percent in 2007.

Fourth-quarter sales from casino games increased 60 percent to us$ 35 million, while poker revenue gained 16 percent to us$ 21.4 million. Casino and poker sales per so-called active customer rose 26 percent to us$ 270. Prior-year revenue excludes the US, where foreign online-gambling companies can no longer take bets.

Annual sales gained 36 percent to us$ 213 million, fueled by a 33 percent increase to us$ 118 million in revenue from casino games. The US ban wiped out about half of 888’s revenue. “This was a transformational year," CEO Gigi Levy said in a telephone interview. “These are very good results that we think show our strategy is delivering."