888 Chief sees return to pre-slump Web gambling gains

Online gaming has been hit by slowing economies and a drop in consumer spending during the worst recession since World War II. 888’s second-quarter operating income fell 12 % to us$ 61 million from a year earlier, and the number of active casino and poker customers declined 8 % to 180,000, the company said today in a Regulatory News Service statement.

“We feel a lot more confident the industry’s going back to its normal growth trend, rather than continuing to be hurt by the recession,” Levy said in a telephone interview. “We’re looking at first quarter as the lowest point, and aiming to grow from there.”

888 is looking to set up operations for other businesses to compensate for a slowdown in poker and casino gambling during the global recession. The Gibraltar-based company is also trying to attract female customers, especially in Continental Europe, with bingo and other online games. Both income and player numbers bottomed in the first quarter, 888 said .

First-half sales, which are reported in dollars, were hurt by the strength of the dollar against the euro and pound this year, Levy said. At the end of the second half, the pound had slipped 17 % against the dollar over the year-earlier period, and the euro 11 percent, according to Bloomberg data.

888 rose 1.3 pence, or 1.5 %, to 83.5 pence in London. The shares have dropped 16 % so far this year, giving the company a market value of us$ 487 million.

Levy said 888, which has 22 contracts with other businesses to set up online-gambling operations, is talking to television stations, media companies and state-owned lotteries about joint ventures. 888 is seeking to acquire European companies, or develop its own online games, to target female customers, he said. It will introduce online bingo outside the U.K. to attract them to its Internet sites, he said.

Online gambling, which once had an 85 % male customer base, is now used about as much by women in Britain because of the growth in Internet bingo, Levy said.