by Renee Israel
888 Holdings, a leading London-listed online gambling company, has issued a
statement saying that it expects its full year earnings to be ahead of
expectations.
888's rise in profits for 2011 is related to a number of factors,
including a jump in the number of people gambling online in the UK.
The group said that its casino and poker products, in particular, continued
to be very popular, and trading was strong throughout the year.
With fears growing that the UK will fall back into recession
next year, an increasing number of adults are seeking alternative ways to
entertain themselves from home, and online gambling, especially at sites with
offerings such as 888's, are becoming more and more popular.
Revenue for 888 Holdings jumped by 42% year on year in the third quarter of
the year.
The statement issued by the group read: "888 therefore expects clean earnings
before interest, tax, depreciation and amortisation (EBIDTA) for the year ending
31st December 2011 to be significantly ahead of market expectations."
The group said that 2012 "is set to be a year of major opportunity for 888,
with the opening of several newly regulated market across Europe."
888 intends to invest heavily in these new markets in order to expand its
market share. As a result, shares rose 5% this week to 36.75p.
Analysts Warn Against 888 Bullish Outlook
There have been several analysts who have actually warned
against the bullish outlook for 2012, however, including 888 itself.
The group said that investing in other markets next year,
together with the fact that the UK intends introducing stiff gaming duty
increases, would have an impact on profits.
888 Holdings reassured investors, however, that results would
still be ahead of forecasts.
Also reassuring the public was James Hollins, an analyst with
Evolution Securities, who said: "The expected decline in FY12E YoY earnings will
cause concern for some investors, but the group is making sensible investments
in much called for regulating territories, driving high quality longer term
earnings."
888 Holdings operate casino, poker, sports betting and bingo
sites. The group, which trades on the London Stock Exchange is currently valued
at £125 million.
The group hopes to expand into the European market in 2012 in
regulated and in many cases, extremely lucrative markets. The European online
gambling market generated revenues of up to €80 billion last year.
