A growing appetite for sports betting in Europe combined with a weaker sterling have helped Sportingbet deliver a 23 per cent rise in first quarter pre-tax profit.

The online gaming group, which makes 96 per cent of its revenue from outside the UK, saw profit before tax increase from £5.3m ($8.6m) to £6.5m for the three months to October 31 as European punters’ love of a flutter continued to grow.

Total sports bets wagered in Europe grew by 38.2 per cent to £263.8m while net gaming revenue increased 56 per cent to £27.2m – or 44 per cent of group NGR.

Andrew McIver, chief executive, said football betting is “going from strength to strength” in Europe in spite of the recession, with Greece and Spain now the group’s two single largest markets, accounting for 36 per cent of group NGR.

“Broadband penetration gets better every year in these countries and people get more and more comfortable with online betting,” he said.

Mr McIver said the growth of online sports betting was also being driven by the rising popularity of “in play betting”, which allows punters to place bets in the middle of a game. The amounts wagered on live betting increased 68 per cent to generate NGR of £15.2m in the quarter compared with the same period the year before.

“It’s something that lends itself better online than in a brick and mortar bookmaker because you have to be able to it quick,” he said.

Not all markets have proved to be as profitable for Sportingbet however. Earlier this summer, the group sold its Italian operation to the local management team for a “nominal” amount after three years of failing to turn a profit in the country.

Trading in Australia, its fourth largest market, was also adversely affected by a series of poor horse racing results in the quarter. Amounts wagered increased by 17 per cent although NGR declined by 12 per cent.

Nonetheless, analysts said this was a strong set of results, and the market reacted positively, driving the shares up 7.5 per cent to 75¾p.

Net gaming revenue for the quarter rose 17 per cent to £48.6m while basic earnings per share increased from 0.9p to 1.3p.

The group, which announced its intention to move from Aim to the full list earlier this year, said it expects the move to occur during the first quarter of 2010.

Sportingbet indicated that it was beginning to recover from the US Department of Justice’s move to clamp down on online gaming that nearly wiped out its business in October, when it announced plans to pay its first dividend in three years.

Source: FT

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